4 Ways AP Automation Helps Cash Flow

4 Ways AP Automation Helps Cash Flow

Uncertainty has forced organizations everywhere to tighten their belts and redefine how work is done. Some have had to implement creative ways to keep the doors open. Others are doing everything they can to keep the ship moving forward. Digitizing a limiting manual process is essential to success as your team is away from the office. Automating previously manual processes has become a requirement, as people are unable to execute processes in person anymore.

Your AP team knows this better than anyone. Even when we’re not facing a global crisis, cash flow awareness is critical. The more visibility you have of its movement, the better you can learn from the past, swiftly manage the present, and look confidently into the future.

The aches (and pains) of AP

Lack of visibility—and the presence of a manual AP process—spark uncertainty about how money flows through the organization. Your AP team members already deftly balance the roles of cash gatekeepers and vendor peacekeepers. Reducing their cash flow visibility with an outdated workflow robs your finance team the ability to be proactive.
  • What’s due, when?
    Surprise invoices prevent AP teams from having a firm grasp on the exact output of cash. Blindsided, they must stop what they’re doing to chase down the origin and accuracy of mystery expenses. Progress and production stall.

  • Could the vendor cut us a break?
    Asking vendors for improved terms and rates isn’t new. As work continues to shift, it’s becoming even more crucial to optimize cash on hand. Much of a vendor’s willingness to work with you stems from your ongoing relationship. A history of partial or late payments as a result of uncertain cash awareness could limit their leniency.

  • Is there a better way to do this?
    A clunky, manually intensive AP process is detrimental to adaptability and growth. It forces the team to operate almost entirely in a reactive mode. They panic to locate lost invoices. They burn time uncovering surprise cashflow drains. They are leaking cash by making duplicate payments.
It’s exhaustive work that doesn’t need to be. It creates blind spots when total visibility is needed most.

Automation = Cash awareness

Automating AP counters the frustrations outdated workflows create. At the same time, it generates critical, actionable awareness. Not just of invoices in your team’s immediate sight, but from a global view of how cash travels through the organization. Also, how it impacts your business relationships.

Here are four ways automating AP can help:
  1. Get above the cash tide
    If your team is drowning in a sea of invoices that come in and go out without any sense of order, automation is vital. They will be able to float above the changing tides to produce a game-changing perspective for finance. They can rely on past transaction histories to make more informed choices. They’ll gracefully handle invoices with confidence. And they can begin looking forward—far beyond the current situation.

  2. Mend and improve vendor relationships
    You’re only as reputable as your last payment. To maintain continuity, organizations are negotiating more favorable payment terms to stay cashflow positive. Frequent late payments or misplaced invoices can ruin your reputation, weakening any support for your case. They may not be flexible when negotiating terms that aid your cash flow at their expense.

    Automation helps improve those relationships by getting your team out from behind the unknown and overdue. In time, you’ll forge stronger relationships, cultivate a willingness to work with you, and your credit could improve.

  3. Trade on stronger rapport
    Through the increased insight and improved vendor rapport automation provides, new opportunities materialize. As an example, you may uncover instances where you’re making repeated purchases from the same source. You may have earned the organization a chance to negotiate savings on future orders—a win-win for you and the vendor. All of these strategic decisions rely on accurate data on your cash position.

  4. Humanize AP operations
    Automation makes AP a more humane practice for all involved—throughout every step of the workflow. Your process begins to work with your team, not against them. Fire drills to address unplanned cash flow crunches vanish. Vendors no longer send payment reminders. Your team gains the foresight to think proactively for a change. That helps them feel more connected to the organization, and proud when they can proactively go out to find savings opportunities.
When it comes to cash flow, knowledge is power. By adding automation to your AP process, you harness a global understanding of how and where the organization’s money travels. The elements of a process that cause tension and chaos subside. You also pave the way for your AP team to contribute a degree of certainty when so much is changing.

If you’d like to learn more about Certify’s AP automation, register for a personalized demonstration to see it action.