Determining if AP automation is a project worth pursuing is primarily based on projected cost savings achievement. This is both a post-installation, near-term consideration, and one spanning subsequent fiscal year projections. While there are many industry average figures in circulation, they don’t provide you with accuracy based on your specific business environment.
The IntelliChief AP Automation ROI Calculator for JD Edwards
IntelliChief has created one, and it’s comprehensive. This tool’s objective is factoring all cost savings related to moving from manual to automated processing in your environment. It encompasses all aspects of AP processing, allowing you to add your related costs from years 1-5 of implementation, providing a true ROI projection. With this data, you’re able to see where AP Automation’s efficiencies affect your organization, providing guidance for process automation optimization when mapping your automated workflow, in-tandem with ECM system integration with your JD Edwards ERP for vendor and order information verifications and validations.
Required Information for AP Automation Justification Calculator for JD Edwards
In order for you to get a clear picture of where your company stands in relation to its ideal automation project, you will have to collect some important (and accurate) information to input into the calculator, including:
AP Statistics and Measurements
Covering aspects of invoice receipt modes, quantities, data capture methods, resource/storage/labor cost (internal and outsourced), late payment fees paid, and early pay discounts available.
Hard Dollar Costs
Quantifying budget allocated to manual processing.
Time Spent Per Person
Assessing appropriated time and cost of employee and contract staff in processing tasks, including invoice printing, ERP/business system keying, approval routing, exception handling, calculating data conversions, filing, resolving duplicate payments, researching internal and vendor inquires, audit preparation, tracking and reporting on all activities.
Justifying Your Automation Project
These extend from Accounts Payable into Purchasing and Receiving, encompassing labor cost of all workflow routes of transactional documentation.
Once these figures are collected and entered into JD Edwards, the Calculator progresses to both Hard Dollar Savings/Gains and Efficiency Savings for each year 1-5, per line item allocation, comparing your current costs to automation. This is the awakening – do the numbers equate the value of AP Automation for you?
Then calculations shift to ROI for AP Automation, measuring years’ 1-5’s returns if you implement an automated environment.
With these calculations completed, the AP Automation project decision becomes a clear choice, and equitable for prioritization. The data accumulated will be foundational for your business case.
For a video overview, see AP Automation Justification Calculator for JD Edwards here.