Whether you’re looking to start your journey to an Accounts Payable automation solution, or are just curious about how it can improve your Accounts Payable efforts, there are some things you need to know.
With a wide variety of automated Accounts Payable solutions and tools available, how do you choose? We’ve rounded up five things to know before you choose an automated AP solution. But first, let’s discuss why you should switch to automated in the first place.
Why switch to an Accounts Payable automation solution?
AP automation solutions make Accounts Payable processes quicker, easier and more efficient with digital workflows and more manageable steps so you can focus your time on more value-added tasks.
Accounts Payable automation uses digital technology to streamline invoice processes and automate the capture, management, storage and retrieval of invoice data. This minimizes human intervention and eliminates error-prone tasks from the Accounts Payable process so you can ensure efficiency and accuracy, and have better visibility and control over important financial data.
Benefits of AP automation solutions
AP automation solutions can completely transform your business and improve your AP processes. By automating AP processes, your company will be able to track invoices electronically, streamline workflows, and allow you to locate invoice data anywhere, anytime.
Benefits of automating your Accounts Payable include...
- Centralizing your AP department
- Streamlining your AP processes
- Saving on labor and supply costs
- Promoting paperless processing
- Increasing productivity and visibility
- Faster cycle times and invoice approvals
- Fewer payment errors
- Better cash management
- More early payment discounts
- More time for value-added tasks
- Eliminating human data entry errors
- Lessening the burden on your AP team
5 things to know before choosing an AP automation solution
Determine your Accounts Payable needs
Before you choose an automated AP solution, you need to determine what your Accounts Payable department/processes need.
Start by looking at your current Accounts Payable processes and focus on your pain points so you can choose a solution that will address your areas of concern.
Questions to ask before choosing an automated AP solution...
- What are you looking to achieve with an automated Accounts Payable solution?
- What challenges are you trying to solve?
- What are the main pain points or bottlenecks?
Audit your existing AP processes
In order to determine your needs for an automated AP solution you need to examine your existing AP processes.
You need to know where you’re at in order to know where you want to go. Start by documenting your current processes so you can easily communicate how invoices are received, the format in which they arrive, how approvals are completed, how invoices are processed, and so on.
Map out all of your current Accounts Payable workflows and keep an open mind to any new processes that come with the new system.
Pro Tip: This is also a good opportunity to outline the best practices for your Accounts Payable department as you move to a new system, which will make it easier to customize and support compliance.
Questions to ask before choosing an automated AP solution...
- How many people are involved in your AP processes?
- Which steps of your processes are manual vs. automated?
- How do you currently archive your invoices after they are processed?
Establish your Accounts Payable goals
Before automating your Accounts Payable department and choosing an automated AP solution, you need to know what your goals are so you a baseline for measuring your success.
Whether you’re trying to streamline your processing, get more accurate records, lower the cost-per-invoice, eliminate late fees, capture more early payment discounts, or all of the above, clearly outlining your goals will make implementing your AP system run more smoothly.
When your goals are clearly defined, you can get a better idea of what you’re looking for in an automation AP system.
Questions to ask before choosing an automated AP solution...
- Will it help you reach your goals?
- What do you want to get out of the change?
Identify your system dependencies
Your AP automation solution is dependent on your Enterprise Resource Planning (ERP) or financial system. You need to make sure that your new AP system has a seamless and stable connection to the ERP so you can synchronize all of your data.
After you synchronize your data, all of your invoices, procurement, and accounting data can be exchanged seamlessly between your systems so you can have accurate and efficient invoice processing with the highest level of automation.
Questions to ask before choosing an automated AP solution…
- Which ERP system(s) does your organization use? Do you use any other systems in your Accounts Payable process?
- Are there are any plans to upgrade or change these systems?
- Can your suppliers/vendors provide a stable and strong connection to your ERP and integrate with your various Accounts Payable systems?
Map out costs
Ardent Partners reports that 39% of accounts payable departments cite high invoice processing costs and a high percentage of errors are their biggest challenges. Luckily, an AP automation solutions can help improve invoice processing and save money.
Start by mapping out the cost of your AP processes so you know the kind of impact a new automated system will have on your ROI.
Questions to ask before choosing an automated AP solution…
- What is the cost of processing an invoice?
- How can you improve the cost with an automated solution?
- Are there any other costs that need to be considered such as postage, supplies, or employees?
Accounts Payable automation solutions can transform and streamline your AP processes, as long as you know what you want to get out of it. Determining your needs, examining your processes, outlining your goals, identifying your system dependencies and mapping out costs is just the beginning of your journey to an automated AP system.
