So, what is AP automation in?
Accounts Payable Automation refers to the use of digital workflow technologies to streamline the entire accounts payable process. The AP automation solution involves various components such as invoice data capturing, approval workflows, and payment processing. In simple terms, it replaces manual tasks with automated systems, significantly reducing labour costs and errors.
Accounts payable processes have evolved significantly over the years. Gone are the days when finance teams would waste hours on manual data entry, processing paper invoices, and individually contacting relevant approvers. With the advent of AP automation software, businesses of all sizes can now automate accounts payable, saving both time and business money.
Why Automation has Gained Importance
While every AP team must include competent knowledge in accounting regulations, data interpretation and business analysis have surfaced as more critical in recent years. Most small- and medium-sized companies use manual invoice processes for vendor payments from which it is more difficult to distil such information.
While some companies have been reluctant to leave their manual processes behind, stay-at-home orders associated with the pandemic have forced companies to examine operational inefficiencies and seek solutions through automation.
With manual AP processes, businesses are likely losing money. In a report published by APQC research, 62% of the cost associated with
invoice processing is labour cost. The more manual the AP process, the higher the labour cost per invoice. Implementing an automated system in your AP department is a vital step toward becoming more efficient and cost-effective.
AP has transformed from a historically transactional function to become a business’s strategic hub. Automation of this department and these essential functions ensures greater visibility, faster invoice approval, increased productivity, reduced costs, and much more.
Why You Should Automate Accounts Payable
The concept of automation is simple—replace slow, repetitive processes with smart software that performs the task for you. AP processes, such as purchase orders, supplier invoices, approvals, and accounting, are still done manually by millions of companies worldwide. The sheer work hours it takes to complete these processes lead to long wait times and slow invoice payments, which can directly impact cash flow.
What is AP automation?
Accounts payable automation, encompasses tools or processes that replace manual tasks with automated handling. For instance, you can digitally submit and approve purchase orders and invoices, streamlining the workflow instead of transporting them to various in-trays throughout the organisation or mailing them to vendors.
Any automation aims to move faster, improve accuracy, and enable scale. With automation, your company will:
- Save time by replacing slow and repetitive work with rapid processing and results.
- Reduce errors by programming the automation to correctly perform rote routines based upon rules you set.
- Digitise documents and eliminate the need for massive, physical storage rooms with cloud storage.
- Increase productivity by enabling your team to focus on higher-value tasks and letting automation tend to the tedious.
- Gain accessibility to your AP from anywhere at any time using any device.
- Enable the organisation to file purchase orders, check analytics, or route documents for approval.
Most businesses realise they can be more productive and efficient by implementing automation, but they did not have the impetus to change a functioning system until recently. With fewer people working in the office, automation has become a necessity, not a luxury.
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While AP automation provides a range of benefits, there are some areas for caution to consider:
Overlooking Training: Employees must be trained to adapt to the new system.
Ignoring Data Security: Ensure that the AP automation software you choose complies with data security regulations.
The future of AP automation looks promising with the advent of AI and machine learning technologies. These will bring about smarter automation capabilities, further reducing manual tasks and enhancing data entry accuracy.
Automating your AP department with AP automation software not only brings efficiency but also contributes to strategic business growth. From faster approval processes to fewer manual tasks, the benefits of AP automation are endless.
If you're looking to transform your AP processes, now is the time to invest in a robust AP automation solution. For more information, feel free to reach out to us.
The Benefits of Canon Business Services' Automated Accounts Payable
With over 25 years of experience in business outsourcing, Canon Business Services (CBS) specialises in accounts payable automation through our advanced AP automation software. Our solution streamlines the approval process and invoice management in your accounts payable department, allowing you to focus on what really matters. Our digital service is designed to offer key benefits, such as improved visibility and control over the entire invoicing process. This empowers companies to avoid late fees, capitalise on early payment discounts, and foster enhanced vendor relationships for better cash flow.
Key features of CBS’s AP automation solution
What sets our AP automation solutions apart are unique features like optical character recognition for efficient document management, which automates the process of capturing and processing invoices. This eliminates the need for manual intervention, reducing errors by up to 40%. The software also includes a supplier portal, making it easier for vendors to submit invoices and for your team to manage approvals. Additionally, it integrates seamlessly with your existing accounting system, ensuring a smooth workflow.
Our focus on innovation and sustainability in payable automation work means that you're not just automating for the sake of convenience but are making a long-term investment in the efficiency and financial performance of your business. With CBS's AP automation, most finance teams have seen a reduction in invoice processing costs by 80%, offering substantial cost savings while enhancing the quality of work in your accounts payable department.
Here's a simplified walkthrough of how AP automation works:
- Receive invoice digitally
- Capture invoice data automatically
- Match invoice against relevant purchase orders
- Route invoice for approval through pre-defined workflows
- Complete payment process
This streamlined approach ensures fewer errors and faster processing times, allowing businesses to take advantage of early payment discounts.
Integration with Other Systems
One of the key benefits of AP automation is its ability to easily integrate with other systems like ERP and accounting software. This seamless integration enables real-time data exchange, making the entire AP process more efficient.
The ROI of implementing AP automation is substantial. Businesses can expect:
- Reduced labour costs
- Faster invoice processing times
- Fewer erroneous payments
- Improved supplier relationships
Why AP Automation is Right for Your Company
Traditional accounts payable processes can be slow, unwieldy, and costly. They can also take up a significant amount of your team's time and require a considerable amount of diligence to avoid errors. What's more, with remote work continuing into 2021, traditional processes make it challenging to provide your team members with access to the documents they need to get the job done.
Implementing an AP automation solution is an effective way to overcome these challenges, and it can help you save time and money in both the short- and long-term. It can also integrate easily with your existing systems, offering you the flexibility to adapt those systems as your business continues to grow and scale. Our automated accounts payable solution offers business intelligence insights and gives you visibility into your business's critical areas, enabling you to make decisions for the future.
