7 Reasons to Automate AP Workflows for Improved Efficiency and Effectiveness
Published on November 9, 2022 /
AP automation improves the efficiency and effectiveness of finance workflows in seven ways:
- Faster workflows. AP automation eliminates the friction that slows down invoice approvals. With an AP automation workflow, invoices are automatically retrieved. Then, invoice data is extracted with a high degree of accuracy and matched against purchase orders in most ERP systems. Unmatched invoices or invoices that require review are digitally routed to the right person based on pre-defined business rules, shortening once lengthy approval processes. Approvers are notified of invoices awaiting review and notified if an invoice is approaching its due date. Invoices that aren’t acted upon are escalated to a manager. And leading AP automation solutions post approved invoices directly to an ERP without manual rekeying.
- Optimization of corporate spending. Automation is the linchpin to better spend management. Purchase orders are automatically generated by leading AP automation solutions. AP departments can capture spend data from the moment it arrives on an invoice when they automate AP. Businesses can approve invoices with rules-based approval routing. An online portal streamlines supplier onboarding. When they automate accounts payable, staff also have full visibility into the spend pipeline.
- Reallocation of staff to mission-critical tasks. Eliminating manual processes such as paper shuffling and responding to supplier inquiries in the AP process enables AP departments to reallocate staff to mission-critical activities that drive business growth and add value to each employee’s role.
- Stabilized operations. The best AP automation solutions ensure that work is done correctly so finance leaders can focus their efforts on customer-facing or revenue-generating functions. AP leaders also can efficiently scale their operations without the need to hire additional staff, lowering process costs. And AP automation mitigates the risk of fraudulent transactions slipping through the cracks.
- Enterprise value. Digitizing and centralizing invoice data enables AP to deliver actionable insights to stakeholders across the enterprise, including procurement, treasury, and the C-Suite. The best AP automation solutions help decision-makers forecast cash flow needs, develop cash flow and spending strategies, and provide visibility into the business after the AP workflow cycle is completed. Graphical dashboards provide visibility into real-time Key Performance Indicators (KPIs) and the real-time status of invoices and cash flow. Drill-down capabilities enable users to analyze data to identify trends and uncover potential issues. Mobile access keeps decision-makers in the know while on the go. Ad hoc reporting adapts business insights to changing business requirements. And exports ensure that data gets to downstream systems fast and accurately.
- Greater adaptability. Adapting manual, paper-based processes is hard. But a solid automation process makes it easy for organizations to adapt to whatever comes next. Leading AP automation solutions aggregate all invoice formats onto a single platform, extract all header and line-item data from invoices, allow digital workflows to be created or changed fast, integrate with any legacy ERP application or accounting system, and provide any time anywhere accessibility.
- Streamlined compliance and risk management. AP automation solutions digitize tax form collection and validation and verify bank account details. Initial and ongoing screening of vendors is automated. Payee fraud risks are proactively identified. And electronic payments eliminate the possibility of payments being intercepted in the mail and whitewashed.
93% of finance leaders believe that end-to-end automation can improve their overall processes1 .
For these reasons, AP automation is a quick and long-term solution. Click here to learn more about how automating AP workflows with invoice and payment automation solutions can improve the efficiency and effectiveness of your finance department.
Sources:
