How to Improve Accounts Payable Efficiency

ARTICLE - Imagine posting a job opening that states that successful applicants are expected to spend most of their workday performing manual, repetitive tasks that could be eliminated through automation.

You wouldn’t expect many job applicants and not many career-minded ones, particularly in today’s tight labor market where tech-savvy millennials represent a growing part of the labor pool.

Yet manual, repetitive tasks are a central part of how accounts payable (AP) professionals spend their day. At most businesses, AP onboards and registers suppliers, processes invoices submitted by suppliers, pay suppliers, manages supplier information, and assists in tax and financial reporting.

Forty percent (40%) of AP professionals say that most of their workday is wasted on manual tasks such as keying payment data, pushing around paper and emails, chasing down check approvals, fixing payment errors, and responding to calls and emails from suppliers about the status of payments.

That’s according to a new survey by the Institute of Finance and Management (IOFM).

Six percent (6%) of AP professionals spend their entire day on manual, repetitive tasks, IOFM found.

Even in AP departments with a world-class enterprise resource planning (ERP) application such as NetSuite, many supplier onboarding, invoice approval, and supplier payment tasks that occur outside of the ERP are performed manually. Consider all that goes into paying an approved invoice with a check: someone must print the check, chase down an approval, and mail the check. And most businesses manually reconcile bank statements with information residing in their ERP.

As a result of all these manual tasks, there never seems to be time for more fulfilling and strategic activities such as cleaning up the vendor master database, collaborating with treasury to uncover opportunities to capture early payment discounts and building relationships with key suppliers. Manual AP tasks also can temper the return on investment a business achieves from its ERP.

Manual tasks such as keying payment information would become a thing of the past if AP professionals had their way, IOFM finds. IOFM found that forty-eight percent (48%) of AP professionals who work in a manual, paper-based environment have looked for a job within the past six months.

Eliminate manual, repetitive AP tasks

Automation helps businesses eliminate the manual processes that hold their AP team back.

That’s why more businesses are deploying ePayables solutions natively built in their ERP system.

An ePayables solution that integrates directly with a company’s ERP application makes it easy to pay suppliers. An AP professional selects the invoices they want to pay and the credits they wish to use from directly within their company’s ERP. An ePayables solution instantly generates a bank file containing all approved supplier payments. A single file can be used to pay suppliers in any country, using any payment type or currency. The AP professional uploads the file to their company’s bank or uses a pre-built connector offered by ePayables solutions providers to upload the file automatically (via an Application Programmer’s Interface or Secure File Transfer Protocol). A supplier payment is created and attached to the supplier bill in the company’s ERP application.

Because the ePayables solution is integrated with the payer’s ERP, payments are reconciled in real-time, eliminating the need to manage spreadsheets, re-key data, or make manual updates to the ERP.

Automation has helped some AP departments increase their efficiency by 200 percent and reduce their AP processing costs by ninety-five percent (95%) while improving operational control. And ePayables solutions free AP staff to focus more time on things that matter most to them and their employer.

Eliminating manual tasks is critical when businesses of all sizes, across all industries, are finding it hard to attract and retain AP staff, and the possibility of an economic recession is growing.

Automating AP with an ePayables solution that integrates with a legacy ERP enables a business to do more with less and efficiently scale its operations without hiring additional finance staff.

If your organization wants to improve its AP efficiency, iCloudAuthority would like to speak with you.

Click here to arrange a time to chat about your needs with one of our AP automation experts.