Handling invoices to make sure they are processed, approved, and paid in a timely manner can Handling invoices to make sure they are processed, approved, and paid in a timely manner can be just as much of a chore as it is an art. This is because the Accounts Payable function in any company - regardless of size - relies on constant input from and interaction with other departments to keep things running smoothly.
This concern over invoice handling continues to exist despite an increasing number of companies switching to accounts payable automation processes, embedding their purchase-to-pay workflow into the larger puzzle of complete Enterprise Resource Planning (ERP) software automation. After all, the combination of the two provides a truly holistic view of all the inputs and outputs from suppliers and manufacturing, even all the way through to Human Resources and marketing.
Don't forget, when it comes to finance, the more accurate the information provided for accounting, the better that you have control over inventory down to an exact product count, or to see where there's any potential for growth projects.
Taking a closer look at Accounts Payable automation
What exactly is it about AP automation that makes the difference?
At first glance, the Accounts Payable (AP) function might not seem like the obvious candidate to have a significant impact on your bottom line. Really, when you look at it the process is all about seemingly tedious and repetitive tasks such as ingesting invoices, purchasing orders and expense reports, routing them to the right people in an organization, catching any erroneous submissions or duplicates, getting those invoices approved or reviewed and finally - eventually - paid and filed away. Seems straightforward, right? But when this process is handled manually the potential for errors, fraud, and the resulting rising costs skyrockets. This is where the benefits of automation start to show.
Statistics from companies that have embraced AP automation clearly show a difference. According to research by both the Institute of Finance & Management (IOFM) and Sterling Commerce, it can cost between £3 and £13 per document to manually process an invoice, plus another £3.16 per document for archiving. Replacing those manual tasks with an automated, touchless process can save an organization on average 80% of processing costs and cut cycle time by 10% to 20%. All this thanks to smart technologies replacing the need for the extra materials you need to ship or create invoices combined with lightning-fast processing speeds.
What’s more, a cloud-based platform like Yooz understands, indexes, and stores every document securely in the cloud. This means that it will catch duplicate or erroneous payments without human intervention and well as create the digital storage and audit trail required by the Making Tax Digital (MTD) initiative.
Automation keeps you on schedule
The benefits don't stop with just the invoice process itself. Accounts Payable automation functionality also helps to cut back on any repetitive late fees. This is a much bigger issue than you might expect: according to research by the Federation of Small Businesses (FSB), around 50,000 businesses are pushed into bankruptcy each year in the UK alone as a direct result of late invoice payments. Considering that Small and Medium-sized Enterprises (SMEs) contribute to 60% of all jobs in the UK, late payments have a significant impact on the entire economy. In addition, according to data from The 2022 late payments report, almost 9 in 10 businesses report that their average invoice will be paid after the due date.
In other words, this amount of "extra" payables can have a serious impact on any company's cash management situation. An automated system prevents this, ensuring that invoices are prioritized and processed by due dates. In fact, thanks to automation payables can even become a new revenue source by locking in any early-pay discounts that a vendor may offer.
This means that automation provides the possibility of new revenue, reduced processing costs (thanks to the dramatic decrease in cycle times as described above), plus increased error and fraud protection (thanks to modern technology data extraction methodology, image capture, and indexing features). Let's also not forget the benefits of endless centralized digital storage possibilities and a complete audit trail. And these are just a few of the benefits.
Even better, when you choose to implement the Yooz AP automation solution, there are no contract requirements and no software licenses. Since the entire Yooz platform lives in the cloud it can be up and running in a short time frame using any internet connection. With the ability to work anytime and anywhere, there won't be any out-of-office approval delays and no late payments.
However, if you can get all these benefits come from automation why even have an ERP? Or if my ERP has AP capability, why use a separate (independent) automation platform?
ERP and AP automation just click
An ERP is usually a software package built to handle a lot of different inputs and make sense of all the data from across an organization. They do an amazing job as a generalist tool that helps prepare Accounts Payable clerks and other employees to input data into the system, from multi-billion-dollar companies down to small businesses.
However, while ERPs can successfully streamline all sorts of business processes, being a generalist means that their capability for detailed AP processing has limits. Often, creating an efficient AP automation process within an ERP (or across multiple ERPs) expends unnecessary time and resources for required custom design and implementation. In addition, many companies fear that integration with any outside platform means that their data could be lost and existing workflows will be interrupted during or after the systems connect. Other businesses might simply not understand the real purpose and mechanics of their ERP, requiring a learning curve to use it effectively.
Industry watchers at Levvel Research found astonishing gaps when polling finance leaders and AP executives about their understanding on the importance of ERPs, their primary role in the finance department’s AP process and how well AP and ERP systems play together. In their most recent 2021 Payables Insight Report Levvel researchers found that "because of their (ERPs) shortcomings, close to 70% of organizations using an ERP-based tool plan to adopt a third-party tool in the next two years."
This is because ERP AP-specific functionality is typically basic, as invoicing is not central to the purpose of an ERP. Levvel states that "Third-party AP tools are the most modern option available and do the most effective job of automating and computerizing the invoicing process. Organizations that use these tools report the highest levels of satisfaction and automation."
While ERPs are extremely useful, they are best suited for service as a financial repository. They simply lack the capabilities of software that is designed specifically for automating the AP function. This is not to say an ERP isn’t effective, but reports show that combining the right AP automation solution with your ERP will level up and streamline your AP process. Even if your ERP comes with a lot of amazing features, there is always room to make it even better.
A perfect example? The partnership between Yooz and Microsoft Dynamics GP.
Yooz plus Microsoft Dynamics GP Accounts Payable automation: the perfect match
Companies using Microsoft Dynamics GP can take modernizing their AP function even further thanks to the partnership with Yooz, integrating the powerful and highly customizable AP automation solution to create a single and seamless ERP automation system. In fact, you can say that the two are a perfect match for each other; this is a combination of a top-notch ERP with the best in AP automation software. And, from the moment a company decides to embrace full-fledged automation, Yooz implementation specialists are part of that customer's onboarding journey. They are dedicated to understanding company specific unique processes and workflows, then using these insights to create a customized integration between Microsoft Dynamics GP and Yooz.
The partnership ensures a seamless and painless integration process, one with a complete dynamic, automated workflow, with ongoing data exchange thanks to both Microsoft Dynamics GP and Yooz's two-way integration capabilities. Don't forget, automation eliminates the need for on-stie paper storage. Instead, the platform automatically creates a digital audit trail and keeps everything stored in a centralized location on the cloud.
Questions? Concerns? Support is available via information accessed on either on the Microsoft Dynamics GP interface or the Yooz platform. No lost information and no interrupted workflows. All parts and factors work together, making a difference to any organization with goals to grow, be more efficient, and become more productive. An integrated Yooz plus Microsoft Dynamics GP means that organizations can rest confident that their process are working for them better and faster, 100% of the time.
The only question that remains is not about moving forward with automation, but why wait to be great?
