Implementing accounts payable (AP) automation doesn’t have to take as much time and effort as some may suggest. Bottom Line notes that there’s over a 400% increase in invoice processing visibility and a 74% increase in processing time for those invoices with AP automation. However, for these benefits to be realized, the company must learn how to implement its AP automation solution best. Not all methods of implementing AP automation work equally well. However, as with most major, sweeping changes in a company, planning and understanding the problem before implementing a solution gives the best results.
How Does a Business Plan for AP Automation?
Implementing an AP automation solution requires a business to take a look at what they’re doing. The accounts payable process tends to be convoluted in a small business, although it didn’t start that way. In the beginning, most procedures are efficient and straightforward. However, as the number of clients and suppliers increases, AP processing becomes more and more complex. AP departments receive invoices, then enter them into the system for processing. The invoice data is then routed to designated personnel for approval and forwarded for payment. In an ideal situation, this would be a simple matter of automating each process. As anyone who has ever tried to implement an AP automation solution before will agree, it’s rarely ever this easy.
As with most complex situations, the best way to approach AP automation implementation to ensure success is by taking it step by step. Planning is crucial to a successful implementation, but how does a business plan for AP automation? There are three critical steps a business should take to help it prepare to automate its AP department:
1. Examine the Existing Process
Your current AP process is where all automation must start. Before a business can automate its AP process, it needs to figure out if it’s running an ERP (or multiple ERPs) and where they fit within the workflow. Automation attempts to make processing more efficient, which can only happen if a business understands the inefficiencies in its existing processes. Additionally, the company must assess its workflows, including the amount of staff each step takes in the AP process. This investigation allows a business to better grasp how much time it spends working through paper-based processes. This period is a baseline for measuring efficiency.
Understanding the existing process is the first step because it lets the business figure out its inefficiencies. Those would be the first places to seek improvement. However, each AP automation solution is different for each organization. While a business might garner some insight from examining others’ successful implementation, they should only rely on those businesses’ successes as hints. Replicating success requires examining a business’s own processes and improving on them primarily.
2. Implement Easy Solutions First
AP automation is a massive transformational project. It can be disruptive to the AP process because of how much of the actual processing it will be taking up. Implementing faster solutions mean that the business can see marked improvements in processing time and efficiency right off the bat. Elements of AP automation such as cloud processing and paperless invoices can be implemented without an IT team’s involvement. Over time, these initial advancements can be expanded. So cloud processing can become cloud workflows, with all data being dealt with through the provider. The benefit of cloud-based processing is that businesses can offer remote opportunities to their employees while only paying for the data they use, keeping costs low.
3. Get Employees On Board
A business’s most significant asset in AP automation implementation is the staff. They are the stakeholders and those who will be interacting with the software primarily. Getting them on board allows a business to streamline its digital transformation. Feedback from employees enables IT teams to quickly and effectively address issues, leading to less downtime while the rollout is proceeding. Investing in comprehensive employee education allows workers to empower themselves to use the software provided. Those employees would be the ones to adapt the software to the business’s needs, but they need the proper knowledge to do so.
Setting Up For Success
AP Automation doesn’t happen overnight. It typically takes a lot of planning and foresight to implement an AP solution that benefits a business. Each business is unique, and each answer must, similarly, deal with the challenges of a particular business entity. If you’re looking at getting started with AP automation, Arista Consulting can help you streamline your rollout process and advise you on industry best practices. Contact us today to learn more about making your AP automation implementation a success.