Your Accounts Payable team is important, right? After all, they keep the lights on for the rest of your organization to do their jobs. But the process of reviewing, managing, and paying all your third-party vendors is tedious and labor intensive, prone to missteps and wrought with inefficiencies. And for many who are still embracing or coping with remote workers, these challenges are exacerbated by the physical distances your departments and employees are dealing with.
The process of Accounts Payable is relatively unchanged over the decades. Leadership makes a purchase, an invoice is generated, an AP clerk reviews, approves, and issues a check for payment. But that is a simplified narrative at best. For starters, there are bound to be more than one vendor your organization partners with. For us at Advanced Office, we have north of 2000 registered vendors. Some were one-time purchases, some of them are annual, quarterly, or monthly subscriptions. Some are even more frequent, and possibly even less predictable in timing, but all of them require prompt payment and all of them need to be reviewed for accuracy. And this creates a lot of time for our AP Department to spend reviewing, matching, filing, and paying.
So, what can be done, how can this decades old process be improved? Well, just like Henry Ford discovered at the turn of the last century: through automation. Currently, only 30% SMBs are automating their AP process verses 58% of larger businesses who’ve already adapted to using automation. What does that suggest? It suggests that the large corporations, the titans of industry have already discovered that this is the secret to improving efficiency in this arena.
You see, it can take a team hours each month to manually enter data in the system; invoice numbers, tax information, check numbers. All of this can be further complicated by clerical errors and missing details that require hours more of digging to clear up. Let’s sprinkle in the communication challenges of asking another department head to review and approve a charge or communicating within the department for a check issuance or a signature.
Now, instead, lets imaging automatic indexing and data export allowing for an AP Clerk to scan the document, just one single action, and a program to capture and record specified fields like invoice number, vendor name, total charges, and PO number. A system then compiles all of this data for upload directly into your accounting programs for easy match and check issuing. As for accuracy, the important details of an invoice are captured by the software. There are no mis-keyed sequences or wrongly identified reference numbers. The communication is automated so that it goes directly to the proper person for the next step instantaneously. A simple approval drives it home for a check to run and you’ve taken a days-worth of effort down to a matter of minutes. Think of all the headaches that we've just eliminated for your team with a simple scan of a document and a push of a button.
Need to find that invoice later? No longer do you need to thumb through filing cabinets and hope they were organized properly, you can just enter some specific reference information, like vendor or invoice number, and pull the document instantly. Even if your information is partial, just use what you have, and the system can find the top suggestions of what you are looking for. You don’t even need to be at a computer to do this. With proper clearance, you could achieve this from your smart phone while floating in a pool with a tasty, cold beverage. Just be careful not to drop your phone.
Best part of all is that unlike the automation that brought us Ford’s famous Model T, these platforms are not one size fits all. While the concept of Accounts Payable may be familiar amongst the masses, the actual application is individual by organization and industry. These tools are therefore inherently customizable, built specifically to match your team’s workflow process – not to change it, just to automate what you have in place already. For example, if one person needs to approve invoices from only one specific vendor, these programs can identify that based on the information scanned and automatically route to approved person on your team.
The goal in all of this, what 58% of large business have already discovered and are now leveraging, is to free the time your employees spend to be better used in other applications of extending your business. Time is money, as they say, so save time where you can and improve the results of your company as a whole.