Success in the accounting department is pretty simple: Pay and get paid as quickly, accurately and cost-effectively as possible. For many companies, the main reason for failure to do so is just as simple. Traditional paper invoice processing and delivery limits what is possible in efforts to improve efficiency in accounts payable and accounts receivable. Getting rid of the manual paper-pushing by automating AP invoice processing and AR invoice delivery is the only way to reach peak performance.
Drivers for automation extend past time and money savings alone. According to a recent research report by Aberdeen Group, automating AP and AR can help companies achieve high levels of success in managing operational cash. The report recommends AP and AR automation as part of a strategy for companies to achieve Best-in-Class status, which is characterized by lower Days Sales Outstanding, better accuracy in cash flow forecasting, shorter cash conversion cycles and fewer discounts lost in comparison with other companies. Survey results in the report show that automation helps make top performers more likely than their competitors to streamline operational cash practices.
Automation can also help support regulatory compliance by bringing visibility to AP and AR processes, making documents more easily accessible for internal and external audits without having to dig through filing cabinets to find invoices and related documents. An electronic audit trail and automated reporting capabilities make it easy to monitor invoice processing and delivery.
Two birds, one stone
Although the advantages of automation are clear-cut, choosing a solution is not always so easy. With so many automation software products and services marketed either for AP or AR invoices, companies seeking to automate often end up looking at the two solutions separately. If the accounting department has different business process owners for AP and AR, it may seem to them that supplier invoice processing and customer invoice delivery are so unique that they need their own specialized solutions.
But while stand-alone AP and AR invoice solutions may do their specific jobs well, they can also add complexity to the accounting department and the IT environment. Separate solutions for customer and supplier invoicing means two different technologies to learn, two different technology vendors to deal with and typically no integration between the systems.
Today’s most advanced document process automation technology lays the foundation for top-tier electronic management of both AP and AR invoices with one solution. With this type of solution, the accounting department benefits from a versatile tool with specialized AP and AR features that can adapt to the company’s unique requirements. An integrated platform encompasses a unified base of data capture, workflow, document transport, archiving, reporting and other functionality underlying specific capabilities for automated supplier invoice processing and customer invoice delivery. The flexibility and scalability of such a comprehensive solution also means an accounting department can automate as much or as little of both processes as it wants, focusing on what is most important first and then expanding the automation into other areas as time allows.
Advantages of a single solution for AP and AR
Along with delivering high return on investment and low total cost of ownership that will make VPs smile, the accounting department gains the advantages of a single reference point and only one product for staff to learn. IT benefits from less infrastructure to support and fewer software updates to do (or no infrastructure and no updates at all if the company uses the platform as a cloud service).
AP and AR invoice documents and data are available through the same interface, giving accounting managers a department-wide view of what’s in the invoice pipeline and one source for the information they need to allocate staff and resources. Internal or external auditors can get the data they need without switching between interfaces. Invoices and information about them can be easily shared within the accounting department; between departments like purchasing, sales administration and customer service; and with suppliers and customers.
There’s a final icing on the cake that any accounting professional can surely appreciate. With a comprehensive and integrated automation solution, the company can get more long-term value for its money by using the same technology to automate processes throughout the order-to-cash and procure-to-pay cycles. In addition to removing the inefficiency and cost of paper invoice handling from AP and AR, and scaling to meet changing requirements in accounting, a single-platform solution is capable of tying together business data and processes like sales order processing and customer billing, or procurement and supplier payment, for broad-ranging visibility, consistency and operational excellence. Automation efficiencies, consolidation savings and interoperability gains are spread across the company, all thanks to the accounting department.