Cost savings. Improved efficiency. Reduced delays and errors. What organization doesn’t have strategic goals around these fundamental operational pillars?
In accounts payable, those high-level goals begin with the details. In a recent comparison of the AP performance of best-in-class organizations versus all others, Ardent Partners found some rather alarming trends for those organizations who are not making the “A” grade. Take a look at some of the findings:
Cost to process an invoice: $15.38, versus just $2.87 for best-in-class.
Time to process an invoice: 17 days versus just 4 for best-in-class.
Percentage of suppliers that submit electronic invoices: 12.6% versus 70% for best-in-class.
The top-line invoice processing cost alone should give you pause if you’re hovering closer to the $15.38 average than the best-in-class average. Multiplied by the number of invoices your organization processes each year, that $12.51 difference can be staggering.
How AP Organizations are Making the Grade
A recent Forrester Wave reported that a top priority in AP organizations is transitioning to digital invoice processing—imaging, capture, matching and portals—that automate manual processing. A second priority is in automating the invoice workflow and approval process.
These priorities are from a large study, and while it’s interesting to see how other organizations are improving AP processes, the key to improving your own AP department’s performance and meeting strategic goals of cost savings and efficiency are in assessing exactly where your organization is on the road to process improvement.
Perhaps you’ve implemented a self-service supplier portal and the bulk of invoices arrive in electronic format…but you still have to manually validate, approve and integrate those invoices with your ERP.
Maybe you have an AP automation solution in place that provides automated workflows, but requires customization to address your unique processing requirements.
Or your automation solution works, but you lack full end-to-end invoice processing visibility and are unable to further optimize processes based on a drill-down of key performance indicators.
How Your AP Organizations Measures Up
Find out how your accounts payable organization measures up to best practices. This process assessment quiz will give you a snapshot of your organization’s current processes so you can make the business case for AP automation in exactly the areas you need it. Try the AP scorecard now.