Managing accounts payable (AP) is a critical task. Every finance team must approach it with careful attention and efficiency. If this is done right your accounts payable workflow ensures suppliers are paid on time and accurately. It will foster good relationships with vendors, and provide valuable insights into cash flow management.
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But it’s not that simple. With manual processes and disparate systems, AP can become a complex and time-consuming task, one fraught with errors – the kind of errors that undo all your hard work.
Fortunately, there are ways to simplify your spend and improve your accounts payable workflow. Let’s talk automation…
Automate your accounts payable workflow
Automation – the name of the game when it comes to AP Process Improvement. If you want an effective, streamlined AP workflow, the best thing you can do these days is to automate it. Automating your AP workflow can help you reduce the risk of errors, save time, and increase efficiency.
Automation Payable Automation eliminates manual data entry, which in turn reduces the risk of human errors and speeds up the processing time for invoices. With an automated AP system, you can also track and manage supplier payments, view payment history, and get real-time visibility into your cash flow.
The hard data on automation:
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Cost Reductions |
Automation can lead to an 81% decrease in processing costs. |
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Faster Processing Times |
Companies experience a 73% acceleration in processing cycle times with AP automation. |
Sources: Forbes
Establish a clear AP approval process
Establishing clear approval processes is critical to the success of your accounts payable workflow. You don’t want any old kid off the block wielding your power to spend. By defining who has the authority to approve invoices you can plug gaps in your workflows to engage in a little fraud prevention.
But for optimal results this process can (and probably should) be automated. Manual approvals will give you control, but electronic approvals give you speed. Approvers can handle payments with the simple click of a button.
This speeds up the process dramatically, freeing up your approvers to focus on more important tasks. Adopting a digital system also eliminates the risk of human error, duplicate payments and lost or damaged invoices.
What’s more, this can be done from a desktop or mobile phone, supporting hybrid or remote work.
Implement a purchase order system
A robust purchase order system will regulate costs and control spending. It’ll do this by tracking purchases at all levels of business. When your PO system is firing on all cylinders it’ll also manage inventory and do Automated Invoice Matching with goods received notes (GRNS) to act as a radar for duplicate payments, overspends or fraudulent invoices.
With an automated invoice processing system like Zahara’s and an automated PO working in unison, you’ll have artificial intelligence doing this checking work for you – and doing it at a level too granular for a human to match.
Zahara Top Tip: Need a template for a solid, adaptable purchase order? We’ve got one free to download here.
Centralise your Accounts Payable Workflow
Centralising your AP workflow can help you improve efficiency and aid in reducing AP errors. You can consolidate invoices, reduce paperwork, and eliminate the need for manual data entry. You can also create a single point of contact for suppliers, which can help you maintain good relationships with them.
Automation – yes, we’re talking up the perks of automation again – will be your biggest ally here. Centralising can be done through a unification of the three automated systems we’ve mentioned above: Purchase Order Management, Invoice Processing, and Approval workflows.
When these systems are in lockstep, spend controls will be in the hands of those who should have them, your AP department will spend drastically less time handling invoices, and you’ll be tracking each invoice from purchase order to payment, giving you total visibility of spend.
You’ll be seeing your business like a general looking at a war table – moving resources where they’re needed, holding back supplies where they’re not. The result? A business that’s lean, efficient, and a boss that’s in control.
Provide training to your team
Providing training to your team can help you ensure that everyone is on the same page when it comes to your AP process. By providing training, you can ensure that your team understands your AP policies and procedures, and that they are aware of any changes or updates to your AP process. This can help you reduce the risk of errors and improve efficiency.
To conclude…
Improving your accounts payable workflow will bring a range of benefits to your business. Simplified spend, improved efficiency, better controls are the kind of things that cut the fat and keep your bottom line low.
Automating accounts payable is a direct line to achieving this. Once you’ve got robust approvals and both purchase orders and invoices are being handled digitally you’ll have the power to see and control all the money in your business more effectively.
You’ll also be eliminating the risk of human error and saving your human staff time that they can redirect into more effective tasks than filing invoices and waiting for approvals.
How do we know all this? We’re in the business of automating accounts payable. Obviously that means we’ve got a horse in this race, but we hope that this content’s worth shows you we’re not just in this to sell you something.
If you’ve found this content useful, read below for a few more resources that we hope you’ll find useful too.
A word from Zahara
As we’ve said, we’re in the automation game. We’ve been doing it for a while. All the knowledge we’ve accumulated over the years – we’re putting it into a blog for people with questions, problems or an interest in automation. You can find that here.
We’ve also launched The Totally Balanced Podcast where we discuss the day-to-day life and challenges of the CFO.
Of course, if you’re hooked on the idea of automating your accounts payable, you can give us a call and chat with an expert, or book a demo to see what Zahara can do for your business.
