Accounts Payable Automation and Your ERP System
When you get your first enterprise resource planning (ERP) system for your organization, that is the perfect time to also implement an effective AP Automation/Electronic Invoicing solution. That way, both systems can work together for optimum efficiency in collecting, storing, managing, and interpreting all of the data from your business activities. This includes everything from manufacturing, to purchasing, planning and service deliveries.
ERP Systems are Limited
Typically, companies will implement an ERP system and wait until later to go with Accounts Payable Automation. They seem to think that their ERP system should handle everything, including requisitions and invoices. It’s true that some ERP systems have the capability of handling some very basic E-invoicing and requisitioning tasks; however, it is usually with minimal functionality when it comes to being an effective answer to the EIPP issues. In addition, there are a number of processes that ERP’s don’t handle at all, like contracts and sourcing.
The problems usually start with basic invoicing when your company first sets up its finance system and you begin to pay invoices. At this point, many companies just go out and purchase some cost-effective software like QuickBooks (that’s only entry-level), put it to work, and then go back to their everyday business of making money. Then the company begins to grow, sometimes slowly and other times very quickly. When this happens the entry-level system can’t even begin to meet the expanding needs of the company. That’s when the company’s CFO usually makes that all-important decision to go with an ERP system that will address the company’s core financial processes.
AP Automation/ERP Systems Work Together
But, stopping there and expecting that ERP system to handle everything can be a big mistake. Just because you have a license doesn’t mean that you can just start it up and it will do everything for you. The fact is that implementing an ERP system with an AP Automation solution will take a little bit longer, but having both will help to maximize your efforts in the long run. On the other hand, if you implement your ERP solution and then go back later to start up your AP Automation/Electronic Invoicing solution, it could result in doing much of that same work all over again. Don’t waste your valuable time by making this oversight.
At the point that your business has grown enough that you have to switch from QuickBooks to, let’s say, NetSuite, your best option is to make it completely automated. So, now that you know you need more functionality and have upgraded your ERP system, don’t go halfway, go all-in by implementing your AP Automation/Electronic Invoicing solution at the same time. You’ll be happy later, ensuring that you won’t have any gaps in any of your core financial processes.
AP Automation/Electronic Invoicing is a high return and low impact solution that has the capability of making your ERP implementation more highly functional by creating all of your purchase orders that are getting pushed into your ERP system. Feeding your ERP good clean data right from the start is the name of the game. Once in your ERP system, you already have all the necessary accounting codes and categories. So, in the end, the pairing of the two systems creates the ultimate in efficient automation for handling all of all of your company’s financial needs.