Accounts payable automation is an inevitability. There are too many innovations and time savings for it to not be a part of the finance operation. And even if your organization doesn’t adopt AP automation, your competitors will, which puts your business at a disadvantage when it comes to scale and growth.
Yet, there are still some unreasonable doubts that seem to linger.
1. Perceived disruption to the status quo
Will people ever use this solution? This becomes an issue with change management in an organization. Just because you’ve been doing something the exact same way, doesn’t mean that it’s the right way. When it comes to technology, of course, the status quo will always be disrupted. Any new paradigm, especially one that is replacing something so entrenched as the AP process, is bound to change traditionally time-consuming, manual processes.
The difference is that if an AP automation solution is light in impact and in what it asks of users, not only will it be used, it will be relied on. Look for AP solutions that don’t require significant implementations and solve multiple issues (such as supplier data management, cash flow, invoice data & capture, invoice approval, data entry, approval processes, and audit trails), and that don’t involve complex user or supplier portal onboarding and training.
Perhaps the biggest disruption is that your team will finally be free.
2. Upfront investment and cost versus value
It’s difficult to comprehend value for something that you haven’t experienced. Conceptually, the idea of paying for technology that does what a person can do seems unnecessary. If for some reason you’re a power-mad, empirical CFO, you may be looking to build an army of AP minions to do your bidding and die for the cause. It’s not as much fun to rule over software.
However, if you’re having issues hiring and managing accounting teams, or if the goal is to not continually add, vet, and train an AP team, software is a great option. AP automation software exploits the economies of scale. Its value is realized during growth periods and the need to execute best practices that support them. If your business is not growing or if it doesn’t have a lean methodology, you might not need technology. For any other situation, it’s time to pay attention.
And any accounts payable automation software or payable solution that has proven value will be willing to engage in an ROI analysis with you.
Why risk adding technology that may make things worse? How many ERP implementations have there been that have lasted years? There is a reason to be skeptical of some ERP systems and technologies. Often times, software vendors will make promises that don’t work, either because the projects weren’t properly scoped out or changes occur in either the business or technology.
And that’s really the secret to successful implementations. Take the time to understand if the technology will map to your future goals. Understand the roadmap of the software provider. Ask to speak with their customers or read public reviews to solutions.
Then it’s not about technology as a whole that becomes the obstacle for action. It’s just that specific vendors will better fit your objectives.
4. Wrong perception of what’s available
One could argue that AP automation has been around for a while. Certainly, that’s true…for some elements. For example, invoice processing—the effort of digitally reading and capturing data from supplier invoices—is essentially a commodity product. Even the workflow elements are standardizing. But if that is your understanding of what AP automation is, that’s an incomplete assumption.
Like all technology, AP automation has evolved to take on more of the entire supplier payment process. It continues to solve issues around onboarding, data management, tax compliance, even executing and reconciling payments. And once those elements are in place, at-scale early payments are also on the table.
Software, particularly cloud-based, has gotten better and will only continue to get better, and that’s its unique lifetime value.
5. The squirrel effect
Lastly, we all get distracted by our daily routine. Something that is only a pain when it happens, such as dealing with payment errors or compliance failures, is only painful for that moment. Then something else grabs our attention; the “out of the ordinary” appearance of a squirrel in the window.
But accounts payable is a job that must get done. And doing it poorly means thousands of tiny cuts every day into the operation. Those cuts hurt. They won’t kill you. Yet collectively they have an effect on the morale, the efficiency, and the risk exposure the organization faces. And all this happens even while existing solutions are proven and available that would remove those cuts.