How to Achieve a Completely Paperless Accounts Payable Department
In a modern enterprise business, there isn’t much of a reason that the accounts payable department should be relying on paper at all. Historically, when imagining what typical AP looks like, one might envision paper invoices, paper checks, sticky notes stamped on monitors, several-page long reports shoved in filing cabinets, etc. Even today, in an age where many businesses have implemented partial automation tools to digitize specific paper-heavy processes, many struggle to let go of paper entirely. Paper checks still go out in the mail, and manual signatures for invoice approvals remain commonplace. But a completely paperless accounts payable department is not an unrealistic vision. It’s entirely achievable with comprehensive automation tools that automate AP processes from end-to-end.
In this article, we’ll examine the impact of any remaining paper left in your AP workflows and how fully paperless accounts payable departments are more optimized for success.
The Hidden Cost of Paper
It may not seem like a huge deal if AP is relying on a bit of paper as part of their processes. If most of the invoices are received electronically, that practically eliminates paper costs, right? Not quite. The truth is that the cost of any paper used within the department adds up.
Completing tasks manually/through paper guarantees bottlenecks and late payments. Late payments mean late fees, burning a huge hole into the company’s expenses.
There’s also the financial risk of check fraud. Paper checks are reported to be the most susceptible form of payments for a business, accounting for 66% of all payment fraud. Yet 81% of companies still utilize paper checks to some degree, meaning most businesses are still vulnerable to financial loss due to counterfeit, stolen, altered, or forged checks.
Beyond monetary costs, there’s the cost of the damage to the environment that comes with paper—a globally impactful expense that simply isn’t necessary with our current advancements in technology.
Any existing paper in accounts payable is an expense for the business, but it doesn’t have to be that way. A truly paperless accounts payable department functions exponentially faster, with essential processes happening in seconds rather than days.
To understand how beneficial a truly paperless accounts payable department really is to your organization, it’s crucial to understand the impacts of any remaining paper left in your AP workflows, and how fully automated departments are more optimized for success.
Many organizations believe that it’s enough to automate some of their processes to save money. This strategy simply isn’t effective, resulting in little, if any, ROI.
In a partially automated department, there’s a disconnect between the processes that are automated and the ones that still involve paper. A high number of staff in AP still have to report manually, handle exceptions, chase approvals, or write out paper checks.
With a fully automated department, there’s no need for any paper, as all of the processes are streamlined into a seamless workflow. Approval routing, discount capture, built-in reporting capabilities, and payment are all integral functions of a high-level automation solution.
What Does Paperless Accounts Payable Look Like?
If you don’t have a 100% paperless accounts payable department, you aren’t functioning at 100% efficiency. Accounts payable departments that have made the decision to implement best-in-class accounts payable automation have seen huge ROI after implementation, averaging 80% lower invoice processing costs, 73% lower invoice processing time, and a 60% lower invoice exception rate.
After implementing a full-scale high-level automation solution, you will no longer see sticky notes plastered across monitors, filing cabinets filled with paper, and checks being written out by hand. Instead, you’ll find a staff composed of proficient individuals who are setting their sights on meaningful work—bringing the company a higher level of efficiency, less risk of late fees, and the opportunity for discounts.
If you’re ready to bring your AP department a higher level of efficiency, it’s time to start looking for an enterprise level accounts payable automation solution to bring your organization success.