How Can You Overcome These 5 Accounts Payable Challenges?
Improving financial efficiency and cash flow on a corporate scale is a truly daunting task, one where you may find yourself under constant and heavy pressure to reach what the organization defines as success.
With so many stakeholders in play, managing such complex processes presents significant logistical challenges. How can you improve outcomes, reduce costs, and save time when there are hundreds or thousands of invoices in action at the same time?
The 5 Biggest Challenges
Manual effort
Removing paper and manual effort
Inefficient paper-based systems rely heavily on manual tasks like data entry, thus wasting valuable time and resources, increasing the risk of error, and providing less process transparency. It’s becoming increasingly difficult to justify supporting manual tasks over automated processes.
Implementing the right automation technology can offer complete visibility of the AP processes in play. This can deliver significant insight and audit trail of all activities, status updates, and rule changes which can help identify process improvement opportunities. Automation should be at the heart of your efficiency improvement strategy as it presents one of the greatest opportunities to improve AP performance.
Fighting fraud
Enhancing security and fighting fraud
Automating and streamlining is critical, but even slimmed-down operations need far better security than most organizations enjoy today. Payment fraud is on the rise, as is the level of sophistication for fraudsters, and that problem simply isn’t going to go away.
Pairing with the right partner can greatly mitigate that fraud risk. Making payments electronically versus checks cuts down on the risk of payment fraud, and more broadly, the right technology partner enables your organization to spot and prevent invoice and payment fraud attempts well before they become a problem. The right partner can also assist with the validation and storage of sensitive vendor bank account and payment data, to eliminate this hassle and risk from your AP team’s workload.
Mitigate fraud with tools like vendor bank authentication, multi-factor authentication, invoice and payment risk scoring.
Data management
Improving the efficiency of data management
With automation technologies in place, you can have access to large quantities of data , including real-time visibility into where payments are going. Used correctly, this information can optimize the efficiency of your end-to-end payables process, provide insight and improve decision-making.
How do you identify what data is genuinely valuable?
With the appropriate systems in place, you can mitigate data mining and get straight to the information that’s important to you, allowing you to significantly improve productivity and cut costs. Considering about half of all organizations have identified better access to data and reporting as a priority, getting the right technology into place to help you parse and share data is critically important. Automating accounts payable processes leads to improved financial management and more efficient AP workflows. Better control helps to tightly manage the outflow of cash resources.
Paying on time
Paying vendors on time
Vendors can be your greatest ally in the battle to reduce costs and optimize financial efficiency. Good vendor relationships are often mutual and offer equal benefits to both sides if maintained. In order to achieve such a harmonious collaboration, it’s essential you ensure they are paid on time, every time.
In an ideal world this would be easy to achieve, but with cash flow challenges, meeting common 30 day payment terms can be tricky. AP automation will help you to better manage your payment processes, pay vendors on time, and take advantage of early payment discounts. With the right partner, you can even extend accounts receivable tools to make the lives of your vendor partners even easier.
Increase AP's Value
Bolstering the value of accounts payable
Traditionally, AP has been considered a cost center for the organization, not a strategic partner or revenue generator. With automation technologies available to free up staff for strategic initiatives and reduce inefficiency, that can now change.
Automating AP processes leads to improved financial management and more efficient AP processes. Those process refinements lead to cost-savings and increased value to the larger organization, making AP a more valued partner in the organization’s plans.
