August 24, 2020 | Accounts Payable
The ongoing recession has brought a new set of priorities for accounts payable (AP) leaders. The pressure to cut internal processing costs has deepened. At the same time, the need to ensure payments are timely for strategic suppliers has never been more relevant to the bottom line. For example, if early payment discounts are in place, the burden is on AP to manage the process quickly and accurately.
How do finance leaders ensure the right balance between cost efficiency and productivity in AP in this stressful economic environment?
Digital transformation in AP has emerged as the ideal way to meet these priorities head on. This is evident in the widespread adoption of the latest technologies.
According to an Ardent Partners survey (“The State of ePayables 2020”), the majority of best-in-class AP departments are already leveraging artificial intelligence (AI) and automation software. In fact, these best-in-class AP teams are twice as likely than the average AP department to adopt e-invoicing, e-payments and complete procure-to-pay automation.
It’s no secret that AP organizations have long struggled with inefficiencies. Mostly due to manual, paper-based processes and software that has become outdated. As a result, AP teams continue to face high invoice processing costs and long cycle times. This gives them little room to deliver value to the business even if they wanted to.
Here are some average AP benchmarks without automation per Ardent Partners:
However, in best-in-class organizations, the same AP benchmarks are very different, thanks to the adoption of AP automation:
AP automation software itself has been fast evolving with latest advances in AI, machine learning (ML) and cloud computing. In fact, AI-led AP automation software is almost touchless.
For example, invoices sent in any format are scanned and digitized with AI-enabled optical character recognition (OCR) technology. Powerful AI tools enable automatic routing and reconciliation of invoices. The AI performs two-way or three-way matches of invoices and optimizes the workflow. The software seamlessly integrates with all major enterprise resource planning (ERP) systems.
AI and ML also give self-learning capabilities to the AP automation software. This means as the software learns more tasks, the better it gets at accomplishing them over time.
Benefits of using AP automation software
By choosing an AI-powered automation solution, AP organizations do not just boost efficiency and cut costs in the short term, they also future-proof their processes.
To learn more, download GEP’s latest white paper — “What’s Wrong With Accounts Payable Today (And How to Fix It)”