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Bridging the gap between ERPs and AP processes can be tedious and confusing. Cut out the confusion and streamline processes today.
When I started at Tipalti almost six years ago, we didn’t have anything in terms of technology. It was building our finance stack from the ground up. Luckily for me, one of my favorite aspects of my career has been coming into companies that need some help in that area. I call it bringing order to the chaos—young companies are pretty chaotic, and accounting technology may not be the first thing on their mind. So, the first thing I do when I come into a new company is to start putting systems and technology in place to help our people and processes. To me, that’s just fun.
That’s what I did at Tipalti—I came in, and alongside Sarah Spoja (our CFO), we strategized about the most critical things to go after first. Number one, we needed to get an ERP. Number two, we needed to bring our accounting team in-house. Once those two decisions were made, it was about hiring the right people and getting our ERP implemented. After that, we really wanted to fill out our tech stack and move to that next layer of technology. We obviously already had Tipalti, so accounts payable was a no-brainer. But usually, with a lot of companies at this stage, accounts payable might be the last thing they try to tackle.
I was able to sit down with Elvis Nti, the accounts payable manager on my accounting team, to talk about the key questions that arise after an ERP implementation and why AP automation should be prioritized as that next layer of technology adoption.
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ERP Q&A With Paul and Elvis
Paul Henderson: In your opinion, what are the limitations of ERPs when it comes to managing the AP workflow?
Elvis Nti: ERPs are designed for broad functionality across departments, such as finance, procurement, and inventory, and they’re usually a one-size-fits-all solution. Customization in ERPs can be complex and expensive, often requiring IT support or external consultants to tailor the AP process, including approval workflows, tax regulations, automation, OCR, and invoice storage.
For me, ERPs often lack specialized AP features like automation, vendor portals, multi-currency or advanced invoice scanning (OCR), and purchase order matching capabilities. Plus, customizing and integrating these features with your ERP can be complex and costly.
While it’s true that ERPs can handle basic invoice processing, they often struggle with the complexities of two or three-way matching (purchase orders, receipts, and invoices), and manual intervention is frequently needed for these discrepancies, which is unsustainable long-term for your AP team.
Paul Henderson: How have you seen AP automation solve these ERP limitations?
Elvis Nti: AP automation tools provide highly customizable workflows, allowing businesses to tailor invoice routing, approvals, and exception handling based on their needs. They often come with vendor self-serve portals that streamline the onboarding process. Vendors can directly input their own banking, tax, and compliance information, which is then automatically validated (through TIN matching, banking verification, etc.) and entered into the system. This reduces manual errors and accelerates onboarding.
Additionally, AP automation solutions provide real-time dashboards and analytics, offering detailed insights into invoice statuses, payment schedules, invoice information, accounting details such as GL account coding, and cash flow forecasting.
For me, one thing that really stands out is that ERP interfaces are often clunky and outdated, making them difficult for AP teams to use efficiently, which can lead to processing errors or delays. AP automation solutions directly solve this issue.
Paul Henderson: What is the benefit of having an AP automation solution that easily integrates with an existing ERP?
Elvis Nti: Data flows automatically between the two systems without the need for manual intervention—invoices, purchase orders, and payment information directly sync to your ERP. This enables full end-to-end automation of the AP process, from invoice capture, validation, and approval to payment processing and reporting—all within a single system.
An “easy” integration between your ERP and AP automation tool ensures full transparency and audibility (audit trail) across the AP process. All actions, such as approvals, payments, and changes to invoice data, are automatically logged in both systems. Some of my favorite benefits include:
- Faster processing times that allow companies to reduce their invoice backlog, accelerate payments, and take advantage of early payment discounts
- Improved communication and faster payment cycles that lead to stronger vendor relationships (vendors appreciate the transparency and efficiency)
- Reduction in fraud risk and payment errors that safeguard the company’s finances (automation enforces compliance with internal controls)
Paul Henderson: What are the key indicators that an AP solution is the right choice for your ERP?
Elvis Nti: The solution should support API-based integrations that allow real-time sync of data, like invoices, purchase orders, and payments, without requiring custom development. It should automate the entire AP workflow from invoice capture, data extraction, and validation to approval routing, three-way matching, and payment processing. Here are some critical features to keep in mind:
- Scalability, the AP solution should easily scale with your business as your transaction volume, vendor base, and geographic reach grow
- Reporting and analytics, the AP solution should provide real-time visibility into your processes
- Regulatory compliance, the AP solution should offer security features to protect against fraud and unauthorized payments
- Self-service portal for vendors, the AP solution should improve communication while reducing the manual workload for your team
Overall, you should look for a solution that already has customized workflows that can adapt to your unique business requirements.
Paul Henderson: What is your advice for finance professionals who think they can get by on their ERP alone or think they don’t need an AP solution right now?
Elvis Nti: While ERPs are powerful tools for managing financial operations, they often fall short in addressing the specific challenges of AP. By recognizing these limitations and considering the advantages of a dedicated AP solution, finance professionals can position their organizations for greater efficiency and compliance. Investing in AP automation after an ERP implementation is not just about keeping up—it’s about leading and having an advantage in a rapidly competitive market.
If you have any questions or want to talk further, feel free to reach out on LinkedIn or click the link below to learn more about how Tipalti directly integrates with your ERP.
