From Procurement to Payment, Creating an AP Automation Process Your Top Execs Want
Blog: iDatix Blog
Executive strategy meetings, boardroom presentations and quarterly investor calls aren’t always on the “looking forward to” list for top-level management. These front line execs bear an incredible burden for making the kinds of decisions that can greatly impact employee performance, revenue, financial markets and more. That said, a green light for building an AP automation system isn’t given lightly.
Begin with a no-holds-barred needs assessment
Side-by-side AP solution feature set comparisons can make anyone get glassy-eyed. Before scouting AP automation vendors, make sure you know what your priorities and business problems are. The closer the solution relates to inefficiencies and mirrors company needs, the more likely its adoption. Questions to consider include:
– Are you looking for an automation solution that is hosted, on-premise or in the cloud?
– Is this a companywide effort or strictly an accounting initiative?
– Do you have an existing management, workflow or ECM solution? Are you using it? In what ways could it be more effective?
– Are there industry or governmental regulations you must adhere to in order to remain in compliance?
Creating an AP blueprint based on answers to questions like these will reassure that makes your top execs are being brought the most cost-efficient, effective solution—added bonuses all around if you bring them a solution that capitalizes on investments they’ve already made.
Build an airtight business case.
Want to see a CFOs eyes light up? Tell them how they can turn accounts payable into a profit center. Many are wary these days of making expensive investments without clearly quantifiable returns. They simply can’t spend on everything—only the sure thing. There are, of course, two types of returns to communicate: the hard and soft ROI.Hard ROI, or the numbers you can make go up or down right away, include the following:
- Labor cost
- Storage costs
- Operating costs
- Payment delay
- Incidences of manual error
- Vendor payment term profitability
- Time and money lost to fraud
Soft ROI is a little less easy to quantify but adds to your AP business case significantly and should always be included. Soft ROI include:
- Improving visibility into spending
- Decreasing dispute resolution time
- Increasing productivity by improving number of invoices processed per employee and applying saved employee time to more important matters.
- Promoting compliance with existing contracts, thereby reducing savings leakage
- Reporting supply financial performance issues and identifying bottlenecks in the receipt-to-payment process
- Reducing regulatory compliance risks
- Reducing the impact of a lost document in terms of cost and liability
Show them future-proof.
What’s golden for the business today will not necessarily apply to their needs tomorrow so looking at AP automation solutions with an eye on the future is important. Still, there’s no reason to overdo it in terms of buying more than you need—but there are scenarios that make end-to-end solutions vs. AP-only applications a good choice.
- Having other processes that can be optimized and integrated at the same time as AP.
- A business-outlook that may include mergers and acquisitions of other AP departments
In the end, creating an AP automation solution that your top execs want isn’t just about bringing in big-name vendors and throwing out impressive numbers to make them look like heroes—its about building something sound that adds value and they can stand strongly behind each moment, every day.
The post From Procurement to Payment, Creating an AP Automation Process Your Top Execs Want appeared first on DocuPhase.
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