Set Your Strategic New Year’s Resolution for AP
Blog: Kofax - Smart Process automation
Why accounts payable’s top goals over the next 12 months should include procurement.
It’s that time of year – the calendar resets and so do many of our personal and professional goals. Maybe you’ve already set your goals for accounts payable performance over the next year, and they probably include driving more value for your organization. Now is the time to put a plan in place for change to make sure your New Year’s resolutions stick.many of our personal and professional goals. Maybe you’ve already set your goals for accounts payable performance over the next year, and they probably include driving more value for your organization. Now is the time to put a plan in place for change to make sure your New Year’s resolutions stick.
Many AP departments are positioned to make 2017 the year they become a strategic player in their organization – increasing efficiency across the purchase-to-pay (P2P) process chain to provide valuable intelligence that moves business forward. Recent studies show, to reach this next level AP must achieve greater alignment with procurement.
A 2016 survey by sharedserviceslink found that enterprises with poor alignment between finance and procurement experienced more pain points, especially in the areas of visibility into spend, working capital and the length of the financial close process. The same survey found a correlation in the level of alignment and automation of manual processes. Enterprises with truly aligned finance and procurement departments have high rates of automation that speed invoice processing, improve the ability to capture early payment discounts and increase visibility into working capital.
Resolve to collaborate more
Increasing process linkage between AP and procurement is already a goal of forward-looking AP leaders, according to Ardent Partners. Forty percent of AP and finance leaders surveyed in 2016 for Ardent Partner’s annual ePayables report identified collaboration between the two sides of the procure-to-pay process as a top goal over the next 24 months.
When asked what it will take for AP to reach the next level, nearly the same number of respondents (37%) indicated better links with procurement, which positions AP to gain critical insight into contracts and negotiated discounts. With access to that information, AP can improve matching and validation and move closer to achieving touchless invoice processing.
In addition to AP’s visibility into contracts, linkage throughout the P2P process gives procurement greater insight into enterprise spend and supplier performance. Outside of the enterprise, suppliers also benefit from the ability to engage in a single linked process which helps to improve supplier relations.
Connecting AP and procurement through a single solution and workflow can drive improved reporting and communication that leads to better financial results, better compliance with contracts, and greater process efficiencies.
Make this the year to outperform
Ardent Partners identifies organizations with best-in-class performance as the enterprises with the lowest average invoice processing costs and shortest average invoice cycle times. These top performers focus on a holistic view of the P2P process and recognize a tight linkage between AP and procurement offers increased visibility and efficiency. They also leverage technology to streamline these processes and are 77% more likely to use a complete P2P solution.
Specifically, 32% of Ardent Partners survey respondents reported using a complete purchase-to-pay solution. These organizations understand firsthand how connecting AP and procurement through a single solution and workflow can drive improved reporting and communication that leads to better financial results, better compliance with contracts, and greater process efficiencies.
If your 2017 resolution includes outperforming expectations across P2P for your organization, check out our most recent white paper for more ways to get started.