Four Wasteful Activities That Are Slowing Down Your AP Department
It’s no secret that the accounts payable department of any large business has a lot on their plate. Between manually keying in invoices, managing exceptions, and handling supplier inquiries, the average AP staff’s to-do list seems never-ending. What many departments may not realize, however, is that a vast majority of their time-consuming tasks are easily automated with an enterprise-level solution. By automating the wasteful activities that are slowing down your AP department, your staff can shift their focus to higher level tasks. In many departments, there are four common culprits that eat up a huge amount of AP’s time.
1. Manually Keying in Invoices
Whether or not paper invoices have been mostly eliminated in a department, accounts payable staff frequently still have to manually key in invoices from suppliers into their system—whether it be copying and pasting from an email, or reading off of a PDF through OCR or scanning technologies. With high-level accounts payable automation, OCR (optimized character recognition) technology is paired with artificial intelligence and machine learning to read information off of any form of invoice. The technology then inputs the invoice information to the system, creating an electronic invoice that accounts payable can access through their online portal.
2. PO Matching
One of the most tedious tasks that accounts payable may be required to do is matching invoices to purchase orders (POs). The time it takes to read off an invoice and compare it to the purchase order takes a large amount of AP’s time, as well as being highly prone to error—even more so if the department is required to match it to the goods received document as well (3-way matching). With high-level automation, information is matched from all necessary documents instantly and checked for accuracy. On top of that, the system can also take a PO and flip it into an invoice.
3. Exception Handling
A huge contributor to lost time in accounts payable is exception handling. When you have a high-level automation solution in place, exceptions occur less often due to the accuracy brought about from self-service supplier portals and AI with OCR technology. On top of that, in the few cases that there are exceptions, the system utilizes machine learning technology in order to learn how to correct the exception on its own in the future. Additionally, invoices are routed to the department best suited to resolve the issue, meaning AP won’t ever have to touch exceptions that don’t pertain specifically to accounts payable.
4. Supplier Inquiries
In accounts payable, hours of time are often spent dealing with stressful supplier phone calls inquiring about their invoice status. With an enterprise-level solution, suppliers are able to see their invoice status easily and in real-time through their supplier portal. Any further disputes or communication can take place directly on the invoice through the online portal, where the interactions are permanently recorded and stored. This means that screening supplier inquiries over the phone or email is practically eliminated from the AP department.
The End Result
By eliminating the wasteful activities that are slowing down your AP department, accounts payable can undergo a huge, beneficial transformation. With a high-level solution implemented, AP will experience increased efficiency and productivity, while lowering the odds of human error. This leads to more meaningful (and less tedious) work becoming available to the team, such as taking advantage of discounts, monitoring fraud, and analyzing where the company is spending money. With the wasteful activities that are slowing down your AP department gone, accounts payable can become an efficient money-saving department that executives will be impressed by.