Excerpt from the 'Four Fundamentals to Accounts Payable Process Metamorphosis' eBook by CloudX and OnPay Solutions.
Accounts Payable is one of the most paper-burdened areas of the corporate landscape. Today, more companies are looking for ways to do more with less and get rid of wasteful processes. OnPay Solutions has teamed up with Chris Cosgrove, senior vice president and head of marketing at CloudX to share insight into the possibilities of a 'transformed' Accounts Payable process.
Time, invested wisely, is your organization’s most valuable asset when harnessed properly.
"Our knowledge of transactional document process management combined with OnPay Solutions' insights into payment automation create a broad and deep functionality necessary to make the end-to-end AP invoice and payment cycle as robust as possible," states Cosgrove. "We’ve distilled some of our key thoughts into an eBook we believe you will find a valuable asset in your journey towards payables optimization."
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1.) Empowering Accounts Payable Staff
Payments represent a significant area of opportunity for an Accounts Payable department transformation. To get the most bang from Accounts Payable, it is important that your team understands the fundamentals. AP processing technology is both a convenient and affordable way for companies to keep track of automated payments and reduce overall costs. In most cases, automation can improve invoice processing cycles by over 70% to completely manual processes, with the average invoice processing cost being over $6.29, according to The Aberdeen Group.
"Given the changing landscape of payments and specifically the advent of virtual card payment technologies, it’s not only possible to slash costs in this area, but actually monetize them to the point where Accounts Payable, which is normally a cost center for most organizations, and morphs into a profit center," says Cosgrove. Transitioning to an updated processing system allows companies to enjoy reduced costs, a severely improved payables department, and most importantly, peace of mind.
The result is a time and money saving effort for payables staff, but more importantly can begin to eliminate mundane tasks for higher dollar value FTE’s (Full Time Employees).
2.) The Power of Invoice Automation
Long gone are the days of stacked invoices, missing files, and cornering the right person to make sure business payments are approved. Through modern, cloud-based software companies are able to harness the monetary power of invoice automation, while offering the same automation impacts of traditional software, typically at a fraction of the cost. By automating, businesses are able to easily identify and maximize financial opportunities in their payables process.
From leveraging automation technology to reducing payment risks through payment optimization A/P automation makes the end-to-end invoice and payment cycles as streamlined as possible.
"A/P automation results in cost reduction across wasteful or burdened process methodologies for starters which delivers time back to your people," Cosgrove adds. "We’ve distilled some of our key thoughts into this work and as a result believe you will find it a valuable asset in your journey towards payables optimization."
3.) Reducing Risk Through Payment Optimization
Companies can get into trouble by not paying attention to the fraud threats that may surround their business. Problems occur when systems are not in place to monitor and actively track employee activity. "From creating phony accounts, to adjusting the amounts of payments, and more, employees who believe that payments aren’t being monitored closely commit payment fraud," warns Cosgrove. "Externally, forged or phony checks are common, as are debit and credit card transactions that are fraudulent."
Payment security starts with an Accounts Payable department following standardized processes that require separation of duties for issuing payments. At the minimum, we recommend that the person who keys in a payment not issue the paper or electronic payment. Another employee should issue. It is also important to use caution when accepting an invoice from a vendor who's in a hurry for a large payment. With the right precautions in place, such as using trusted ePayment technology, you will prevent unauthorized ACH debit transactions, and avoid both employee and paper check fraud.
4.) Impacts of Accounts Payable Process Visibility
One of the hallmarks of both Accounts Payable automation and payment optimization is a streamlined process. "When you have an electronic document management-centric automation system," says Cosgrove, "you have the ability to track down to the invoice 'who is handling what.' This means that at any given time, you have the ability to know and see exactly who is responsible for processing any given vendor." Additionally, you can auto-assign vendors to specific staff, if you have priority vendors or special processing needs. This also makes troubleshooting problem vendors a breeze and adds the benefit of a heightened degree of accuracy and accountability within the process.
"Beyond invoice processing queues, departmental approvers may not be in tune with the number of invoices that they have queueing," warns Cosgrove. "You can use your oversight (visibility into the process) to nudge people forward or if need be, delegation to intervene and escalate things forward." This is helpful to meet early payment discount deadlines (which tend to very tight) and to meet payment due dates to avoid incurring late fees. Both methods result in a minimized risk of negative exposure and a maximized financial outcome via your payment process.
These are just a few ways that Accounts Payable automation ushers in visibility and has tangible impact on the daily processes of a busy payables department, but the list doesn’t end there. From a payment optimization standpoint there’s more to consider. Visibility is a game-changer for those managing the payables process and something you shouldn’t be content to do without. "Part of this presumes that you are tapping into the potency of some form of a collaborative vendor portal that allows your vendor to participate in the payment process and see for themselves the exact status of their payments," adds Cosgrove. In turn, this means less inbound phone activity for Accounts Payble staff and more time to focus on core responsibilities.
The bottom-line is that there are many benefits associated with payment automation technology. From Accounts Payable staff empowerment to process visibility, you can severely improve your Accounts Payable department from the lense of what makes the most sense for your business. Enjoy reduced handling time of payments by both Accounts Payable staff and your vendors, gain perspective into your process, and learn every detail within Accounts Payable to reap the benefits of electronic payments.
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.