With the pandemic changing workplaces and practices irrevocably, automating accounts payable in medium and large-sized businesses becomes inevitable. The drivers for automation are no longer simply lowering the cost of processing, reducing business risk, or strengthening financial control; it’s now also about people – doing the right thing by staff.
Working through lockdowns
Around the world, communities have been subjected to lockdowns and employees have been asked to work from home where possible. While this is usually do-able for accounts payable personnel, it’s not easy if the business relies on people to administer invoice approval workflows.
As a result, payment times have blown out worldwide, leaving suppliers cash starved and potentially adding to the cost of processing. Further, there has been a huge surge in fraudulent invoices with cybercriminals capitalising on the general disruption. It’s significantly harder to perform all necessary compliance checks offsite without adequate systems and processes in place.
As a result, Covid-19 has forced change and modernisation in many organisations. In the US, 93% of firms with at least $25 million in revenues are currently digitising their accounts payable and accounts receivable operations. Automation is no longer seen as the enemy of the worker; in fact, it benefits employees in the following ways:
– Allows work from home
Earlier this year, Accenture released a report The Future of Work: Productive Anywhere which found that 83% of survey respondents across 11 countries want a hybrid work model going forward, where individuals can work remotely between 25% and 75% of the time.
The report cited reasons to work from home as safety, quality of life, personal autonomy, and technological enablement. It found reasons to be in the office include in-person collaboration, visibility to leadership, creativity, and establishing boundaries between work and life. According to the report, 63% of high revenue growth companies have already enabled ‘productivity anywhere’ workplace models, suggesting a link to profitability.
In accounts payable, automation allows work from home or work from the office. It means that every invoice is automatically captured and validated in the solution before routing through pre-configured approval workflows. Users in the office or offsite can log onto the solution via a web browser and carry out their invoice approval or exception management tasks. This ensures business continuity while supporting a modern and flexible work environment. A complete history of all payables is digitally logged, so invoices can be easily retrieved for supplier queries or auditing purposes.
– Lower stress
Not having the resources to be ‘productive anywhere’ is a significant stressor, particularly for individuals trying to maintain business as usual in compromised circumstances. Automation alleviates stress for accounts payable team members by equipping them with the tools to do their jobs more effectively and on their own terms, whether that is from home or from the office.
When manually processing invoices, there are several pain points for accounts payable staff. The root of all problems, however, is data entry – work that is monotonous and brings little reward to employees. Data entry is a flawed process because it’s slow and unreliable, with errors commonplace. These mistakes lead to processing delays as accounts payable staff need to identify and rectify errors, and then re-start the approval workflow for that invoice.
With automation, accounts payable personnel do not need to enter payables information into company systems. Invoices enter the workflow either via Optical Character Recognition (OCR) data capture technology, or via the PEPPOL network for e-invoices. This means that clean data enters automated workflows, relieving accounts payable staff from data entry and subsequent re-work.
Mistakes are stressful in accounts payable because disgruntled vendors call to follow up on their late payments. Compounding this pressure, is the fact that there may be a lack of visibility as to where the invoice is in the approval chain, and when payment will be made. Looking for ‘lost’ paperwork and chasing approvers lowers job satisfaction for accounts payable. Working with substandard systems and processes is extremely demoralising and, as a result, staff turnover may be high.
Conversely, automation routes invoices to the correct approvers, provides visibility over the workflow, and allows control over when payments are made. This means accounts payable can play a more strategic role in optimising cash flow in the business, while adhering to suppliers’ payment terms and doing the right thing by them.
– Enables career development
By relieving accounts payable personnel from time-consuming and mundane data entry, they are free to take on more valuable strategic work, such as identifying cost savings, advising on cash flow, and managing suppliers. Adding real value to the accounts payable process and the business generally is personally rewarding, boosting employee satisfaction and productivity.
Digitisation allows reports and analysis of the data, helping to inform decision making and potentially pivoting the accounts payable officer’s role into an advisory position. According to Accenture’s CFO Reimagined: from bottom-line to front-line, 78% of more junior finance practitioners say there has never been a more exciting time to be a finance professional. This is due to the data, tools, and technologies they now have at their disposal – or can expect shortly.
Automating accounts payable enables staff to work safely, productively, and with greater employee satisfaction than maintaining inefficient and old-fashioned manual processes. The upside of automating back-office processes, such as accounts payable, is tremendous: automation supports profitability by reducing costs and driving efficiencies while at the same time benefiting staff, suppliers, the broader community, and ultimately customers too.