By Jim Mandt
Having implemented AP document management and workflow technology in midmarket organizations across the country for more than 20 years, I’ve seen the power of technology in affecting positive and productive change – not only for the organizations themselves, but for suppliers, partners and the entire ecosystem.
Technology is available today that can not only extract the paper from AP processes, but can also help leadership ensure they’re cultivating efficiency across the enterprise. This technology makes visibility a priority; creates savings opportunities through reduced paper expenses, early-payment discounts, and avoidance of late-payment fees; and even makes sure the right employees are assigned to the right P2P roles to maximize productivity.
While technology is a powerful and positive influence, it’s only as strong as the processes that underpin it. Having been “on the ground” to support major AP document management implementations in major organizations in a variety of industries, I know that the key to a successful implementation begins with reviewing and fixing outdated P2P processes.
My advice to these organizations is the same today as it was 20 years ago: Take a hard look at the numbers to get a handle on whether your organization’s P2P is an enabler or a detractor of efficiency.
How long does it take a single invoice to make its way through your organization’s AP department? Research by The Aberdeen Group indicates the top 20% of organizations process the average invoice in three days, while the bottom 20% process an invoice in just over 27 days.
Do invoices with the shortest turnaround times get paid first? How much does your organization spend on postage, courier costs, and other delivery expenses? What happens when an invoice is lost? Compare the number of calls made to and from suppliers against invoices actually processed. A significant disparity spells inefficiency.
By answering these and related questions to address process challenges, you’ll be able to best apply AP document management technology to achieve real efficiency and cost savings.
Organizations are best equipped to achieve those results when they prioritize integration of AP technology with enterprise resource planning (ERP) systems. ERP systems are often one of the most expensive and most underutilized technology investments an organization can make.
Any AP department can be an ERP champion. Technology is available to easily make the AP department a hero in the eyes of the C-suite. For example, technology can enable full-text search and sharing of AP information throughout both the AP and ERP solution. That means information is keyed in only once, yielding true savings.
As an AP document management and workflow technology expert, I’m here to tell you technology is NOT the first and only path to true efficiency and cost savings, nor will it be the last. Achieving lasting technology value means putting process first – always.
Jim Mandt is Vice President of Technical Services for Metafile Information Systems. He can be reached at jdm@metafile.com.
