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With the advancement of technology in recent years, manual work and effort are being frequently replaced with automated systems. Almost every organisation makes use of technology and online software – upgrading their workflow, saving of manual effort and running the operations in a more time-efficient manner. In other words, applying the concept of Digital Transformation.

In this article, we will not focus on emerging technologies but carry out a detailed discussion on ERP systems and the benefits of integrating an AP automation to it.


ERP System and its benefits for an organisation:

An ERP system performs the integration of applications in an organisation to monitor and control the functions of various departments, such as sales, logistics, production, purchasing, finance, payroll, accounting and project management. An ERP system is mandatory for an organisation since it optimises the business procedures and automates different office functions associated to services, technology and human resources. The benefits of an ERP system for an organisation includes the following:

– Accuracy and time-efficiency in accessing information.

– Sharing of information between different departments.

– Time saved by eliminating the data and operations that are not required.

– The cost of litigation can be reduced.

– Redundancy can be avoided in such a way that there are no playback operations or duplicate records.

– Work efficiency increases as the time and effort required to move files and reports from one place to another can be saved.

– Expenses of the organisation can also be reduced through the optimisation of management decisions through proper analysis and control.

– The system can serve efficiently between the customers and the organisation, along with considerable reduction in response time.

– The environment of an organisation’s operations becomes more competitive after the introduction of an ERP.

Importance of AP Automation in ERP Systems:

Receiving, approving and paying vendor invoices can be categorised into a process called Accounts Payable (AP).

The AP process can vary dramatically from business to business, with larger companies having whole teams of people managing the accounts, invoices and enquiries of their vendors and service providers. Typically, the manual process used by AP teams of large organisations requires lots of steps and lots of people to move an invoice from being received to being paid by the finance system/ERP.

On the other hand, an automated AP solution increases the productivity of the ERP system by entering the data automatically and creating smart workflows by applying flexible business rules. Manual work is reduced as the filing of data and approvals all take place with a minimal effort, resulting in increased efficiency and reduction in delivery time for better output. ERP alone resolves issues related to human resources, project management, and supply chain. When automation is added to the system, it enhances the overall productivity by the simplification of payment and invoicing processes.  AP automation becomes the backbone of ERP by facilitating its processes and saving cost and time.

You can read more about AP automation stats here.

Some of the main benefits to an organisation after introducing automation in AP include:

– The position and status of incoming invoices can be seen clearly by using a centralised dashboard (we call it a document library). The invoice can be automatically sent to the right user through the automated workflow.

– Information about vendors can be stored in the system. Blocked vendors can easily be identified and handled accordingly.

– As soon as the invoice has been fed to the system, the matching of the invoice, purchase order, and receipts of goods are handled automatically by the system-  once the data has been matched.

– All the data is stored in a sequential order that can prove beneficial if an audit takes place, as it does not require to dig in all of the data files at the time of the audit. The data is available online and is easily searchable.

– In order to make the ERP system to be fully efficient, integrating the system with AP automation is vital. so that the extraction of data and routing of invoices can be done in a time-efficient manner.

– A drastic reduction of errors and duplicate payments that can save you time and money.

Choosing an AP Automation System:

Most of our clients have encountered difficulties to assess their own AP automation requirements. With so many AP automation solutions available it’s easy to get buried in detail and confused as to what you really need. Obviously, needs such as being able to automatically extract information from invoices are common but it becomes a bit trickier when it comes to streamlining processes, attributing roles and permissions and establishment of business rules.

1. Defining the AP Landscape:

In order to define the AP landscape of the organisation, it is mandatory to comprehend the workings involved in invoice processing. A proper analysis should be carried out on how the organisation receives the invoices and whether they are in hard copy or in different digital format via email. 

Another aspect while defining the AP landscape is outlining the organisation’s invoice workflows, as the main objective is automating time-consuming manual tasks. By using the right solution with the right business rules, you could process an invoice with 4 steps instead of 10 or 15.

2. Choose a solution that provides transparency


The tracking and management of invoices become a hard task for the finance organisations when they are not managed in a central location. Through AP automation, the invoices can be stored and fetched from a centralised location. Whether it be receiving invoices, data extraction, or payment processor notifications of approval. An AP automation software should have the  capacity to provide collaboration in the form of an online centralised platform with different layers of permissions.

4. Cloud-based AP Automation:

If an organisation installs an on-premise AP automation system, then it means that it has to have its own servers and carry out its own system configurations. Eventually, making an expensive and time-consuming AP environment. On the other hand, cloud technology and cloud storage are booming today. If a cloud-based AP automation software is selected that addresses all the organisation’s major requirements, then it will enable the organisation to build a cost-effective and strong internal AP framework.

6. Evaluating the AP Software and your future ROI:

We wrote an entire guide on how to create an AP automation business case in order for you to ask yourself the right questions but more importantly to evaluate correctly your next solution in accordance with your unique needs.

In conclusion

It is important to realise the great rise of technology that is taking over worldwide. Digital transformation is shaping new ways of processing information while providing intelligent data to businesses. 

ERP systems have been one of the most important business digital investments in the past few years. The reasons are obvious such as systems are linking different departments under a single framework. However, ERPs are not specifically built to automate invoices by using flexible business rules or AI-driven OCR. That’s where AP automation comes in place. With a reduction of more than 85% in invoices processing costs and a reduction in keystrokes of almost 100%, the difference is drastic and necessary in the long run.

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