Accounts payable managers will face new challenges due to technological advances, multiple payment channels, and pressure to reduce costs. Cloud technology and software automation, for example, have opened many doors for accounts payable managers to streamline processes, but there are still uncertainties on when and how to make AP changes to realize the benefits of these new opportunities. This adds a level of complexity to the accounts payable manager's job while at the same time providing hope of greater flexibility and insight into the data generated from AP. To help, we will address some of the most significant challenges accounts payable managers will face in 2020 and how best to prepare.
1. Managing Data Beyond Payments
Accounts payable may have appeared simpler decades ago, when managers only had to focus on paying outstanding debt in a reasonable amount of time. Now accounts payable managers are responsible for much more than payments; they’re expected to take advantage of incentives, connect to different banks, streamline processes for vendors, transmit remittance advice, track the different payment channels, as well as monitor overall data to find efficiencies that save money. In addition, accounts payable managers are expected to oversee dozens of employees while forecasting cash flow and anticipating cash needs. The success of a company’s flexibility depends more than ever on an accounts payable managers' ability to gather insight quickly from their AP reports and trends and inform other sectors of the business. This data can grow in complexity and at a rapid pace, but accounts payable managers can find an easy solution to analyzing their data by quickly exporting reports and mining key information.
2. Database Errors Due to Manual Input
If accounts payable managers are still relying on manually inputting invoices there is a significant chance there will be errors. The information entered in the database may not be reliable, and it will create uncertainty in the accuracy of the company’s AP history. It’s a time and resource hog that results in the accounts payable manager spending some of their time manually fixing errors and checking for discrepancies. An accounts payable manager can reduce budget and time by leveraging internal resources in the most efficient way possible. Switching over to AP automation and utilizing accurate image processors to read incoming invoices is one way accounts payable manages can avoid this problem in 2020.
3. Becoming a Perfect Payer
What is a perfect payer? A perfect payer simply describes a payer who makes on-time payments using the least expensive payment channel and takes full advantage of available payment incentives.By becoming a perfect payer, an accounts payable manager can save money and time on a larger scale. But how can an accounts payable manager determine the most effective payment channel from several payment options? How can AP managers schedule payments on time when they have so many different payments to manage? For accounts payable managers, the trick is to automate the process to take advantage of available savings and virtual card account rebate programs.
4. Determining Efficiencies of Offsite or Onsite Check Printing
Managing paper continues to be the overwhelming consumer of AP time/labor. It simply doesn't have to be that way. And for companies issuing more than 250 checks per week, it shouldn't be. Supplies and postage discounts and offsite printing efficiencies really add up to saving that make significant impacts to companies. What is important to remember for AP managers is that incorporating AP automation does not create a need to overhaul their existing technology and infrastructure; it’s rather a system's integration on top of current processes. There is no reason to reinvent the wheel…just improve it.
5. Managing Multiple Accounts Payable Channels
When dealing with vendors, contractors, and even employees, accounts payable managers will find that some vendors accept multiple payment modes — or they may request only one. Some employees and vendors may still insist on paper checks; direct deposit might not be an option. Other vendors and contractors may insist on receiving payments through their own accounts receivable channels, creating difficulty when trying to pay in a timely manner. That is why it’s essential that accounts payable managers find a solution that allows them to use a centralized payment hub to interface into any accounting or ERP system to securely automate all payments.
6. Collecting Invoices from Various Channels
Invoices come from a variety of sources, whether in an email, a handwritten bill, a fax, or a standard mailed invoice. Vendors and contractors often use their own invoices, which are not standardized. This requires software or personnel to interpret each invoice. Doing so assumes that the interpretation is correct and errors are not introduced. A dream come true for accounts payable managers is software automation using advances in technology that can read invoices that are hand written or formatted uniquely.
7. Collecting Vendor Bank Instructions for ePayment Programs
Paying vendors via ePayments is a business “no-brainer.” Costs are significantly lower when money moves electronically versus on paper. The trouble is getting started: Collecting the ACH instructions for a database of thousands of vendors. Most solutions generally only enable issuing ACH payments. They don't provide much help getting the process running. Accounts payable managers may envision keying in the data from their thousands of vendors. Now there are solutions that allow you to collect vendor bank instructions. Find the one that allows you to own your vendor database and can streamline communications to enable launch of an ePayment program in under 90 days. (Read more about this on our blog post Simplify Making the Move to ePayments)
As you can see, accounts payable managers have many challenges and opportunities due to automation, networking, and changes in payer systems. That is why it is vital for companies and accounts payable departments to be agile in this ever-changing environment and start pursuing AP software automation.
In today's digital world, no one really uses checks regularly for their personal transactions. Ask anyone outside of the finance industry the last...
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Listed by CFO Tech as one of the Top 10 Accounts Payable Solution Providers 2018 and 2019 and by CIO Review as part of the 20 Most Promising Corporate Finance Tech companies for 2017, OnPay Solutions streamlines processes for accounts payable by automating invoice processing and payments.