Assessing The Risk Of Not Implementing Automated Accounts Payable Solution
Automated Solution Can Match Payments To Invoices
Organizations that do not leverage automated accounts payable (AP) solutions risk certain degree of operational inefficiency and financial loss. By failing to implement software to streamline and automate payment process, organizations are sacrificing their ability to remain competitive in todays marketplace.
For organizations in the finance realm, automating AP is critical. Existing methods of processing accounts payable, such as paper-based or manual processes, create strain on resources as manual data entry and reconciliation is required. In addition to the labor costs associated with manual processing, organizations also risk noncompliances with payment deadlines that impact vendor relationships.
From C-Suite executive?s perspective, this means reliance on manual processes can present number of costly risks that can detrimentally impact operations. Studies demonstrate that manual processes are susceptible to the potential for human error. Intangible (non-revenue-generating) costs related to AP can reach percentages as high as 15-26% of an organizations total cost of goods for sale. Furthermore, manual invoice processing results in organizations processing invoices paying an average of 5.26-7.81% more than those leveraging automated processing.
Organizations tend to realize the greatest benefit from automated AP solutions when the entire process is automated from invoice receipt to payment, with end-to-end integration. Through automation of AP processes, organizations are able to effectively manage vendors, maintain supplier relationships, manage invoice disputes, and ensure payment compliance. With Softwarestreamlining processes, executives can utilize wide range of performance metrics to show the volume and velocity of AP processing, which can help organizations adjust their businesstrategies accordingly.
In conclusion, failing to implement an automated accounts payable solution can be not just an inefficient but also expensive decision for organizations. With manual processes prone to inaccuracy and increased financial burden, automated AP solutions offer organizations range of benefits, such as cost control, improved payment compliance and transparency, and optimized payment processes. By embracing the ability to automate accounts payable process, executives can ensure their organization can respond more competitively in the market.
