Cost of stagnation: Why AP automation solutions are a modern necessity
- 10 Dec 2020
- AP Automation
In this article we discuss the AP automation cost for adoption versus the cost of stagnation for AP professionals who fail to adopt AP automation solutions, and why automated invoice processing has become a modern necessity, not a luxury. Time has been on the side of AP automation solutions. Companies that were once hesitant to invest in what they saw as a luxury now recognize automation is a modern necessity. After years of adopting an attitude of “if it’s not broken, don’t fix it,” the C-suite realizes manual invoice management, and first-generation invoice workflow systems are measurably inferior to today’s AP automation solutions. When remote work became the new normal during the pandemic and quarantining, companies quickly discovered the benefits of having cloud AP automation versus software and paperwork that could not be remotely accessed.
AP automation is no longer the new kid on the block. Companies around the world are appreciating the value of digital AP systems that streamline operations and improve productivity by automating the majority of tasks in the AP process. And those who fail to adopt this advanced technology will soon realize the cost of stagnation, especially as a new normal takes over the world, which includes remote work. Consider why AP automation is now an essential part of running a business, transforming the AP department from a cost center to a potential source of revenue.
Recognition of a necessity versus a luxury
All businesses are looking to cut costs and become increasingly profitable. The implementation of progressive technologies such as AP automation should be viewed as an investment to enable cost savings and streamline operations. AP automation solutions manage invoice processing with greater accuracy, flexibility, increased productivity, and eliminate time-consuming manual processes. And the costs of stubbornly maintaining manual processes add up quickly, such as inevitable human errors and endless hours spent on the year-end audit process.
The savvy implementation of AP automation solutions eliminates these issues and turns the AP department into a strategic, money-saving hub. Failure to adopt AP automation leaves companies behind the competitors who are already using it for years, which quickly became evident during the pandemic. As a result, businesses can lose vendors, customers, and revenues. Heavy and inefficient operations are also a limitation on overall business growth and profitability. It is easy to understand why AP automation is now a necessity rather than a luxury. Fortunately, there are ways for companies to prepare for this essential transition.
Focus on change management
Many companies find the most significant obstacle in the implementation of AP automation is change management. Do the C-suite and AP professionals need to stop their usual routines to examine different tools and innovative processes to maximize efficiency and ensure greater accuracy? Adopting a receptive attitude and taking time to explore the technology is the crucial first step toward choosing AP automation solutions. This begins by letting go of old processes and embracing the exciting possibilities of new ones. The pandemic forced management out of a comfort zone to adopt automation to ensure operations contained to move forward. AP automation cost became an essential investment to remain competitive.
Prepare for the inevitable challenges
The transition from manual processes to AP automation can be seamless for well-prepared businesses that partner with the right provider. Companies must be ready to properly implement a new platform, and accept the time and effort that always goes into updating current systems to transition into a better way of doing things. Training and the learning curve are a necessary aspect of adopting automation. It is time well-spent when companies consider the advantages of educating AP professionals about AP automation solutions to ensure they are making the most of this essential investment. From accurate vendor data to prompt invoice payment, AP automation makes routine tasks easier. Companies scrambling to implement cloud technologies during the pandemic realized the value of planning ahead.
Select AP automation solutions
Do your research about AP automation solutions to get a full picture of what they can do. Choose a respected provider with a strong track record in AP automation. Make a list of the major areas to explore when selecting AP automation, such as the length of time to process invoices, and the end to end cost. Be aware of the top priorities and concerns faced by the financial team. Many companies opt for cloud automation to gain advantages such as 24/7 access to the latest financial updates and remote work opportunities from any device and location. Benchmarking is another benefit of adopting AP automation solutions, so an internal assessment can be made to refine further the marketplace and its possibilities for businesses to keep up with - or surpass - the competition.
Resistance to change means stagnation
What happens if you stay with a manual and resource heavy process? Your operations will not be able to scale with business growth, costs will increase, and you won't be able to keep up with the competition and the increasingly rapid pace of the industry. Eventually, resistance to change can really hurt businesses significantly. As others in the industry move forward faster and with greater accuracy, your company will continue to remain married to old-fashioned methods that don't work as efficiently – and it will show.
The ability to survive in a fast-paced international marketplace is crucial to remain relevant and profitable. For example, think about the risk of losing important suppliers as a result of late payments, the hard costs associated with late payments, and how manual processes contribute to these costly errors. It is time to bring AP out of the back office and prepare for the future, proving your organization has the foresight and the ability to adopt imperative changes. And with robots and AI developments, companies must move to the next level of technology now, as manual processes will become a memory of the past. Here are some ways to start moving forward.
Bring AP out of the back office
The AP team has been hidden away in the back office for decades, focused on the time-consuming and tedious manual tasks required for invoice processing. The use of AP automation is bringing the team out of the shadows and into the light of becoming a strategic partner with the C-suite. AP professionals with access to automated solutions enjoy a better quality of work. Instead of performing mundane jobs, they are optimizing payments for optimum discounts, analyzing data to identify process improvement opportunities, and securing working capital. This thought-provoking work turns the AP department into a hub for cash flow generation.
Get ready for the robots
Manual processes will go from old-fashioned to obsolete in a few years when AI and robotics start edging into the scene. AP automation makes it possible to touchlessly process invoices with no manual work needed. Human intervention is not required, making essential projects such as year-end audits less painful and time-focused.
As technology gets smarter, management has to follow suit by learning and adopting these technologies. Businesses benefit by reducing invoice processing times, making the payment process predictable, and taking advantage of potential discounts and money-saving opportunities. And intelligent humans will be ready for additional advances when robots become part of the team, recognizing the benefits of using automation with human intervention over any other type of processing.
Turn the AP department into a profit center rather than a cost center by adopting AP automation solutions. Improved processes make it easier for companies to attract and keep top AP professionals, which helps boost cash flow and ensure smooth operations for years to come as technology continues to evolve.