Despite millions of dollars of investment in automation in recent years, research from Levvel shows that more than half of businesses (55%) report their finance departments are performing manual data entry.
In fact, as many as 65% receive invoices digitally, yet print them out to re-enter the details into their system. This counterproductive method of working results in continued mistakes, costing companies millions of dollars in wasted time, money and resources.
So, why are so many organizations getting it wrong when it comes to automating accounts payable? And more importantly, what are the strategies to get it right? The answer lies in understanding the difference between digitizing AP and intelligently automating AP.
If a company is investing in upgrading its finance department, it needs to be modern AP automation with results that allow seamless, touchless straight-through processing. Here are some simple tips for achieving that goal.
Reviewing current processes
Are you changing your processes along with your technology? One of the biggest failures in automating AP is that the C-suite will base upgrades on current operations. This would explain why one in five digital transformation projects are abandoned.
Every employee in a department may have a different way of working — some will take short cuts; some will have their own approach to addressing issues and others will stick to the book to follow set guidelines. Staff feedback, therefore, isn’t the best way to evaluate your procedures, yet this is often the basis for instigating change. It is crucial that before starting any type of automation project, an organization get a facts-based, analytical assessment of its current workflow — and that includes people, processes, and content. There’s not a one-size-fits-all solution for all types of processes, and remember, the most common path taken is not always the most efficient.
Yes, ask employees for their feedback, but using technology like process mining or task mining will give you a true representation and in-depth analysis of how processes really work without the employee bias. Once the organization is armed with a digital twin of its processes, it will have the metrics and insights to better understand the bottlenecks, timing between steps and variances to know how to proceed with its AP intelligent automation journey.
Picasa/Colinda McKie – stock.adobe.com
Make changes for employees
Another reason new technology and processes fail comes down to the user experience. If people don’t like it or if it’s too complicated, they won’t use it, simple as that. Just like consumers will turn their back on a hot new app because there are too many clicks involved, so will employees.
Many AP automation processes have not been adopted by workers and therefore don’t deliver the intended results. Often, it’s because the processes have been built around manual data entry and late archiving — which throttles any benefits of basic automation. The report by Levvel validated this with the revelation that 57% of invoices are still entered manually and 23% are rooted manually.
In an era of a potential recession, companies can’t afford to be losing skilled employees who feel burdened by manual data tasks. Even when a pandemic cloud was over our heads, research showed that one in four remote employees would consider quitting their jobs over frustrations with business processes. Staff want their jobs to be more meaningful and productive. A system that is beneficial to both employee and company efficiency goals should be top priority.
Pinpoint the results you expect
You’ve probably read impressive stories about companies achieving outstanding results with AP automation. I’ve worked with major corporations where invoice straight-through processing was 81% faster, achieved a 91% reduction in costs per invoice and 400% increase in employee productivity. This is the sort of success companies should be aiming for. But remember, those sorts of fantastic outcomes don’t come without the right technology and processes in place. Intelligent document processing and real-time process monitoring are all important for optimal investment and the best ROI. You will want to eliminate manual input, reduce approval times, assist fraud prevention, increase visibility into your processes and cut paper use.
Companies need best-in-class, easy-to-use platforms that integrate into existing systems and processes. With low-code/no-code options now available, automation leaders can take advantage of an easier and speedier way to automate a whole range of AP documents such as invoices, receipts, and purchase orders. This type of off-the-shelf automation means business users can be involved in the process using simple plug-and-play platforms enabling them to add digitized documents straight into the current workflow.
Results will come quickly when you have a more intelligent approach to automation. Highly automated AP departments can process 10 times as many invoices per month as those with little or no automation. This is particularly important when 90% of employers accept a hybrid work environment for the future and want to ensure staff are working in the most efficient and productive way.
The days of manually entering invoices into accounts payable to match up with purchase orders is a thing of the past. Ensure that your budget for AP automation really adds up. The results of your investment and your true expectations must be analyzed and calculated upfront.
