AP Automation: Assumption vs. Reality

AP Automation: Assumption vs. Reality

As many companies are still laboring under the assumption that accounts payable automation just isn’t for them, it might be time to take a closer look into the true benefits of a cloud-based AP system. A recent whitepaper entitled 5 Ways to Increase Performance and Improve Processes in Accounts Payable, explores factors that might otherwise be considered “barriers” for many accounting departments and shows how each is improved with automation. Consider the top five seeming concerns, identified by the Accounts Payable & Procure to Pay Network survey:

Barrier #1: Limited internal support to run the AP automation project. Many accountants and controllers are turned off by the idea of automation simply because they don’t feel as if the company has the manpower or internal IT support to effectively run an electronic payments process.
The reality: An electronic system provides little to no burden on a company’s internal resources; cloud-based AP allows for more freedom and fewer “touches” on each invoice. Plus, by automatically filing and approving invoices, it minimizes the need for specialized training.

Barrier #2: Weak business case for automation. Although the benefits of AP automation are vast, companies may find that not everyone is on board with implementing a new system. According to the whitepaper, the two reasons why automation proposals might fail are because they don’t reflect senior management priorities, and the upfront capital investment is too high.
The reality: While there may be some opposition to change, nearly half of the controllers in the IOFM survey identified lowering accounts payable costs as a top priority. And by introducing cloud-based AP software, invoice processing costs are reduced in a number of ways. If saving money isn’t a strong enough case for automation, real-time payment reconciliation, reduction of errors, and visibility into the process might just sweeten the deal.

Barrier #3: The high upfront cost of automation. One reason companies may disregard AP automation is the cost associated with the initial investment. When introducing a change to the process, the unknown can be scary, and the sheer cost of a new software might be too much for a decision-maker to agree upon.
The reality: Although traditionally viewed as a necessary and costly function, the accounts payable process has been shown to be extremely cost effective when automation is introduced. By generating revenue through card spend and early-payment discounts, cloud-based AP can prove a full ROI for almost any initial investment.

Barrier #4: The overwhelming change that comes with an automated system. Change can be scary, there’s no argument there. And when changing an entire process, the “what-ifs” seem to multiply. In fact, PayStream Advisors found that six percent of organizations said not knowing “where to begin” is their biggest problem with enacting an automated AP system.
The reality: Introducing a new system can prove intimidating, but by choosing the right electronic payment solution, existing systems can be seamlessly integrated into the new platform. For example, merging an AP solution with a current ERP platform Adds exponential benefits for the company.

Barrier #5: The fear that security will be compromised. The hot button topic: fraud. When introducing a new system, there is always the assumption that security and privacy will be compromised. And with an average of five percent of company revenue being lost to fraud each year, per the Association of Certified Fraud Examiners, it’s no wonder the assumption still stands.
The reality: The best part about a cloud-based AP system is that security is automatic. Where a manual payable system might leave room for overseen potential risks, an automated platform has numerous points of security, and automatically checks for any fraudulent activity.

After all, with 63.5% of controllers claiming that accounts payable is a priority for improvement, it’s clear a change is in order. And while AP automation doesn’t come without some perceived barriers, the reality is that electronic payment solutions help to overcome these concerns, increase performance and improve processes.

Certify invoice offers all the features your AP team needs to maximize productivity and efficiency, including invoice imaging, flexible and locked approval workflows, ACH payments, and complete visibility into reporting metrics. Ready to find out more about Certify Invoice? Contact a representative or register for a hassle-free open product demonstration today.