Accounts Payable Automation: Preparing Your Organization for a Digital Future
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The document discusses the transformation of accounts payable (AP) organizations from manual to automated processes between 2016 and 2018, highlighting benefits such as reduced processing costs and improved cash management. Statistics show a significant decrease in errors with automation, alongside expedited invoice approvals and better supplier relationships. The future of AP is envisioned as largely automated, with digital payments and virtual card numbers playing a crucial role in reducing costs and enhancing efficiency.
Accounts Payable Automation: Preparing Your Organization for a Digital Future
- 1. 2016-2018 WEXCORPORATEINFOGRAPHIC APORGANIZATIONSARECHANGING WHYAUTOMATE?4 Companies around the world are bringing their AP organizations up to date—and into the digital future. By reimagining their workflows and investing in the technology they need to get them from point A to point B with more accuracy, speed, and cost-savvy, they’re making a big impact on the bottom-line and serving customers and suppliers better than ever. The following stats, facts, and figures highlight their journey from the manual to the automatic: 68% Reduce overall processing costs Remove paper from AP department Accelerate invoice approval cycle times Improve cash management Reduce lost invoices Improve visibility into spend 52% 46% 35% 28% 24% Better invoice audit capabilities16% Obtain incremental supplier dynamic discounts9% Strengthen supplier relationships5% GOALSFORTODAY’SAPORGANIZATIONSWITHINTHENEXTTWOYEARS3 : 75% 70% of payments made by businesses are done by check1 of AP Professionals say at least half of their invoices are still on paper2 53% 37% 33%Improve collaboration and process linkage between AP and procurement Reduce operational costs on AP-related processes Automate more AP processes AUTOMATIONVIADIGITALPAYMENTSARETHEFUTURE LOWER COSTS LOWER COSTS REDUCE ERRORS SAVETIME ENHANCEVISIBILITY COSTSINCLUDE: Paper, postage, paper storage, printing, labor, infrastructure 40%ofAPprofessionals reported a decline in error rates after automating2 $ 4-20Average cost of writing a business check5 $ 3MAnnual cost of processing 10,000 invoices per month at $25 per invoice $ 480KAnnual cost of processing 10,000 invoices per month at $4 per invoice 62% 2015-2017 CHANGESTHEAPPROFESSIONALSEXPECTSTOSEEBETWEEN2015AND201715 : VIRTUALCARDNUMBERS(VCNS)AREAPOWERFULDIGITALPAYMENTSOLUTION: 78% 19% 52% 68% 46% 88% 86% 82%AP staff will move away from manual tasks The AP process will be largely automated The amount of paper will significantly reduce Labor costs typically consume 62% of total AP costs6 43% 43% AP Pros say their avg. e-invoice costs less than $22 90% 90% of EMEA companies don’t have a transparent view into their cash flow6 39% 39% of treasury officials across regions and industries still use the dreaded spreadsheet to forecast cash flow10 TIMEITTAKESFORDATA ENTRY,VALIDATION,AND APPROVALOFANINVOICE2 : 72% – 5 days or fewer 10% – Less than a day 9% – Less than an hour 9% – Other HALF Amount of time (49%) spent on transaction processing by members of the finance department7 Vendor invoice errors 4.0 to 3.1 Vendor payment errors 2.6 to 2.3 Vendor checks reissued 1.9 to 1.8 Employee expense report errors 3.6 to 1.7 Employee reimbursement errors 1.8 to 1.3 Employee reimbursements reissued 1.2 to 0.6 of B2B companies believe mobile is the future of online commerce11 of digital commerce revenue from mobile channels is B2B generated12 of B2B executives said they were comfortable making business-related purchases on a mobile device13 of B2B buyers made online purchases in 2014 versus 57% in 201314 of B2B buyers spent at least half of their corporate procurement budgets online in the last year14 e-payment is facilitated through the widely accepted major credit card networks suppliers get paid faster, leading to improved cash flow at a lower cost than check, wire, or ACH transactions payments are settled in the currency of the recipient, leading an easier international payment at a lower cost each transaction yields detailed remittance data that goes much farther than what’s provided through legacy methods VIRTUAL CARDS Sources: 1 AP Now 2 Institute of Financial Operations 2014 AP Automation Study 3 Ardent Partners’ePayables 2015: Higher Ground 4 Bottomline Technologies Building a Business Case for AP Automation, citing PayStream Advisors; Electronic Invoice Adoption Benchmark Report 5 Wall Street Journal 6 CFO.com citing APQC research 7 CFO.com citing APQC research 8 The Institute of Management & Administration 9 Pymnts.com article Data Digest:The Scary Stats on Cash Flow Management: citing CashfacTechnologies and East & Partners, EMEA Operational Cash Index 10 Pymnts.com article Data Digest: The Scary Stats on Cash Flow Management citing Sungard, Treasury Risk Market Survey 11 Usablenet 12 Gartner 13 Forbes 14 Accenture Interactive’s 2014 State of B2B Procurement Study 15 Ardent Partners’2015 State of B2B Payments See also: Cash Flow and the AP Process: 3 Big Roadblocks to Automation Automation: Part of the Corporate Cash Flow Solution TRANSFORMINGAP THROUGHAUTOMATION