Transform AP & Finance Workflows Using Intelligent Process Automation
At its very foundation, an organization has a set of business processes and procedures. Whether big or small, every business strives continuously to improve these processes, reduce resource waste and costs, and optimize its workflows.
In her book "Digital Capability: Building Lego Like Capability Into Business Competency," digital leadership specialist Pearl Zhu famously wrote:
"Processes underpin business capabilities, and capabilities underpin strategy execution."
Effective business growth depends on defining a solid strategy. And to execute it successfully, you must refine essential business processes. Process improvement is an ongoing effort that must keep changing and scaling along with the organization's growth.
Process improvements for accounts workflows
Recording financial transactions systematically and in minute detail is of utmost importance—and the accounting department plays this essential role.
A robust accounting structure is important for organizational efficiency. Accounting workflows start from when a transaction is first recorded to when a financial statement is submitted. This accounting process is crucial because it generates key financial documents such as balance sheets, income and cash flow statements and reports of equity status. Inaccuracies, manual errors in any of these, or incomplete records can prove very expensive to the organization, attracting financial fines or penalties and legal action if statutory regulations are not followed.
So, efficient accounting and finance workflows are critical for enterprises to function smoothly, retain healthy profit margins and cash flow, maintain good vendor relationships and credit history, and create credibility in the market.
Enterprises can improve accounts and finance workflows using a combination of team, technology, and process methodology. It is important to identify the pain points or hurdles in your existing processes and then map a solution for those. Process mapping assesses business operations to pinpoint these problem areas and refine workflows to build efficiency.
Thus, we can define business process improvement or BPI as identifying the operations or employee skills that could improve and encourage smoother procedures and more efficient workflows and aid overall business growth. Improving accounts and finance workflows brings significant benefits to the organization.
Using business process management experts to improve AP workflows
The AP department controls all payments that a business makes to vendors, partners, and contractors. Accurate vendor invoice information and timely payments are crucial to avoid late penalties and fines. Enterprises use BPI (business process improvements) to find ways to reduce the time it takes to complete AP processes, eliminate resource wastage and improve the AP team's efficiency.
Enterprise leaders also undertake BPI to increase compliance with rules and regulations that govern those processes and improve customer experience. The accounts payable process relies heavily on physical documents. When AP processes rely on manual inputs, the chances of errors, inaccuracies, and delays are high.
Automating tedious tasks in the AP process, and streamlining payables—like vendor invoices, purchase orders, and sales orders—is an important step toward improving AP workflows.
Some of the AP workflow automation touchpoints are:
Capture
The first step is to receive invoices in a suitable format and digitize them for further processing. Digital mailrooms are an efficient way to centralize invoice receipts and digitize paper invoices at the point of entry.
Validate
AP staff uses a 3-way matching process comparing the purchase order and goods receipt against the invoice. If there are any variances, they initiate procedures for correcting them and seek approval again.
Route
Once validated, invoices are routed to specific approvers based on PO number, requester name, or department.
Approve
Once the authorized staff approves an invoice, it automatically goes to the finance department, which processes the payment. The invoice is marked as paid and can be closed at this point.
Invoice automation: A step towards paperless AP workflows
Invoice automation is an important step to go from paper-driven to paperless AP workflows.
Automated invoice capture and extraction tools read critical information from digitized invoices and make the process of validation hassle-free as automation reduces the chances of errors and reduces the time taken for meticulous matching.
Additionally, AP automation solutions also ensure that data is interoperable between ERPs and the document management systems. This unlocks the real value of data.
According to a survey by AIIM, the adoption of AP automation solutions resulted in an average of 29.2% reduction in invoice processing costs. In addition, about 29% of the organizations reported savings of 50% or more from adopting AP solutions.
How does RDS transform accounting processes for organizations?
Revolution Data Systems help your AP department with a mix of document scanning, intelligent data capture services, AP automation solutions and the expertise of workflow management consultants.
RDS provides comprehensive implementation and support services for custom solutions for AP departments that can seamlessly integrate with existing IT systems to improve invoice processing performance in real-time.
Benefits of AP automation and workflow management
Eliminate time-consuming and tedious manual tasks and free up time for your AP staff.
Achieve better visibility into invoice and payment statuses across the enterprise, allowing you to manage cash flows better and make data-based decisions.
Speed up vendor payments by digitizing invoice approval workflows.
Achieve compliance with accurate audit trails.
Make available accurate and detailed AP process data in your ERP system, thereby aiding business operations teams with real-time payment data.
Talk to RDS for integrated solutions for transforming your accounting workflows. Our expert workflow consultants help you understand how to reduce costs and improve process ROI. We deploy process management and automation solutions to streamline your accounting payables workflows. As a result, you get quick turnaround times in payment processing, reduce the risk of delayed payments, and increase consistency towards compliance. Request a demo today!