Thoughts coming from the Basware Team. Basware teamed up with the Institute of Finance & Management (IOFM) to identify a practical 3-step approach to getting the most out of your accounts payable (AP) operations with automation.
When your organisation grows to the point where accounts payable is having a difficult time keeping up—or worse yet, is holding that growth back—it’s time for a change. This is when most AP professionals realise they need a software solution to do more than just pay the bills on time. They need automation in order to be a true partner in advancing the company’s progress.
Highly automated AP departments process twice as many invoices per person and at one-third of the cost of their highly manual counterparts, according to IOFM’s recently completed three-year study of nearly 400 payables departments. But how did the profession’s most successful AP managers start their automation journeys? It can seem daunting, but it doesn’t need to be.
When looking to improve the performance of AP teams, mapping and standardising processes are necessary first steps. Why? Because getting your house in order prior to automation sets you up for success and builds momentum for positive change, ensuring you’ll get the greatest benefit from your implementation.
Automation won’t fix a broken process. It will simply take that inefficiency and make it a software issue rather than a manual processing issue. You want to start your automation journey as fresh and unencumbered as possible.
In order to do that, you need to analyse each step in your existing process by defining:
The name for each step of the process (for example, paper invoice sorting)
The order in which it occurs (first process after receipt)
Dependencies on other people, departments or processes (mailroom)
Who owns and is responsible for each step (AP supervisor, invoice intake team)
What knowledge is required to perform the function (ability to categorise invoices by amount, PO vs. non-PO)
Once you have a good handle on your existing processes and have fixed what you can, you’re in a good position to determine which ones are still causing you the most pain and where the bottlenecks associated with manual processing are really slowing you down.
Identify the areas in which you need the most improvement and develop a list of goals you want to achieve through automation. Determine which processes, reports and software compatibilities are must-haves, nice-to-have, or not necessary, then document that. This is highly important for step 3.
Step 3 starts by doing your homework – research your vendors. There are plenty of feature-rich solutions out there, but which ones are best-suited to meet your needs? At this stage, use the goals you established in step 2 to help you identify the vendors that are most likely to be a good fit.
Don’t forget there are other considerations such as a vendor’s reputation, experience in the AP solution arena, references, responsiveness—all these things will be fundamental to making the right choice. Ask for this information as well. A solution provider with solid experience in AP and P2P solutions can also help you avoid making mistakes during implementation and in the future, as well as help you get up and running more quickly.
For more useful information on kickstarting your AP Automation journey, read the full report here.