Tens of thousands of suppliers. Hundreds upon hundreds of invoices every day. Multiple locations. Zero automation. If this sounds like your organization, your accounts payable (AP) department is probably swimming in hours of manual, tedious tasks. On top of the lack of efficiency, how are you effectively – and strategically – managing spend? And more alarmingly, what type of risk are you putting your organization under from your lack of visibility? These dangers, along with other issues, such as late fees, should not be taken lightly. Plus, geopolitical, economic and global trade dynamics are now constantly in a state of flux, necessitating even greater visibility.
AP automation can make a huge impact on your business and especially with advances in intelligent technologies – artificial intelligence (AI) and machine learning (ML) – you simply can't delay longer. Your competitors that are automating and leveraging AI and ML will be – or maybe already are – leaps and bounds ahead of you. Whether you need to convince yourself or your colleagues, these three reasons should tip the scale.
Put the magnifying glass on your risk
The pandemic revealed huge pockets of risk that companies may have been blind to for years had such a global disruption not occurred. The issues have served as a wake-up call for many to gain more visibility to mitigate risk in the future. Because let's face it – it's not if, but when, will the next disruption occur.
But as you are still in recovery mode or simply keeping resources tight, how much time is your team allocating to analyzing your supply chain to determine your risk level? It's near impossible without automation. So, that's step one. The AI and ML technology baked into certain automation solutions can even deliver supplier and spend analysis recommendations to your team without them having to expend any of their time. They could ascertain if your organization is too dependent on one supplier; if it has too many suppliers for the same category, resulting in missed volume discounts and preferred customer status; if it has suppliers in a geography that is politically unstable and much more.
Do more with less
With an unprecedented labor shortage, there is no question that all businesses need to be as agile as possible. If your organization is global, you of course receive invoices in many different languages. Without any automation, well, that sounds like a nightmare. Without AI, there will still be a delay due to template set-up or manual mapping. But with automation and AI, you can capture and map invoice data automatically. With certain AP automation solutions, AI automates the conversion of machine-readable PDFs to e-invoices, requiring extremely minimal manual effort for the AP team. Unlike optical character recognition (OCR) technology that relies on capturing data from images, AI-enabled technology is trained using data digitally extracted from historical invoices via an ML model. So, the effort is low, and accuracy is extremely high: win, win.
Be the early bird and save
Lastly, imagine being able to identify invoices at risk of being paid late, avoiding late payment and instead capturing early payment discounts and optimizing cashflow. With predictive analytics that analyze patterns found in transactional information, you can. Just like a crystal ball, this technology can predict potential future outcomes. Consider this: some vendors offer an early payment discount such as 2/10, net 30. A discount of 2% for paying 20 days early equates to an annual interest rate of approximately 36%. So, if you have sufficient cash balances, you should take advantage of the early payment discounts. With an AP automation solution with intelligent technologies, you'd position your team for more proactive decision-making, leading to a clear competitive advantage for your organization.
Stop heading in the same direction
According to 3 Steps to Transform Your AP Pain into Peak Performance, “When your organization grows to the point where accounts payable is having a difficult time keeping up—or worse yet, is holding that growth back—it's time for a change. This is when most AP professionals realize they need a software solution to do more than just pay the bills on time. They need automation to be a true partner in advancing the company's progress.” These three reasons are just the tip of the iceberg. There are too many more for you to continue down a manual path. So, I'll close with this quote from Lao Tzu, “If you do not change direction, you might end up where you are heading.”
