Over the past few decades, Accounts Payable (AP) has been transformed from centralized, entirely manual processes to automated solutions that have had great impact on costs. As enterprises embrace a paperless office with eInvoicing and payables efficiencies continues to evolve, we must look beyond cost control to long-term business value.
The Ardent Partners’ report, ePayables 2014: The Quest examines not only the current state of AP, but also, the future of AP. In the whitepaper, we identified the top 3 changes AP should care about for the next 2 to 3 years:
Paper invoices will be significantly reduced.
AP processes will be largely automated.
AP will take on more strategic activities.
Additional changes to AP include: there will be stronger AP and procurement partnership; the skill set required within AP will evolve; and AP will be involved in working capital optimization.
Seems obvious, right? Well, what’s important to note is the top 3 changes to AP are closely tied together. By reducing paper invoices, enterprises are able to remove the expensive and mundane manual processes, like keying data into a system and tracking down approvals.
Moving to a paperless system naturally falls in line with automating the AP process, which bolsters our efficiencies while greatly reducing errors that typically occur with manual processes, such as processing redundant invoices and late payments.
As AP’s role within the enterprise continues to evolve, AP will start to take on more strategic activities that transforms them from a cost center, to a profit center. For example, with an automated AP process, we are able to improve cash flow visibility, strengthen supplier relations, and add millions to the bottom line through paying invoices early, and paying less.
What does the future hold for companies that keep their payables process manual and paper-based? Unfortunately, for those AP groups, they will not be able to add any real and strategic value to their enterprise’s financial operations. And these manual processes are costing companies millions in time efficiencies and missed early payment discounts.
As processes evolve and technology becomes more woven into our daily lives, those of us in AP will need to keep abreast of the latest solutions. That said, we should not be overwhelmed by new technologies. Today, there are a number of P2P solutions available, which have proven track records of being user-friendly and having high adoption and engagement rates from suppliers.