Ardent Partners recently published a new AP focused report. Entitled AP Metrics that Matter (click to download, registration is required) and sponsored by Kofax, this Ardent Partners research report discusses the importance of capturing and analyzing data and presents a set of “metrics that matter” for finance and AP leaders alike to track, evaluate, communicate, and improve their financial operations and performance. Here’s an excerpt:
Recent Ardent Partners research has shown that a majority of accounts payable (AP) organizations are interested in transforming their departments by reducing the amount of paper invoices they currently process and deliver reduced costs, improved efficiency, and greater visibility into process and payables as a result. To understand and communicate the impact that an accounts payable transformation has on business operations and results, AP organizations should begin measuring and tracking their performance, and ultimately develop a series of “metrics that matter.”
As modern businesses progress deeper into the digital realm and away from manual, paper-based processes, their automated systems are capturing an increasing amount of potentially valuable information and data. Left to reside untouched in legacy “systems of record” (i.e. back-end ERP and other legacy financial systems), this information offers no real value to the enterprise; however, when analyzed and presented within systems of engagement (i.e. ePayables, P2P solutions, and solutions that support business processes) the data is generally more accessible and usable and can better support decision-making and drive real value.
Despite the broad-based move towards process automation within large and mid-sized enterprises around the globe this past decade, accounts payable is a business function that has lagged behind most others in its adoption of technology. As a result, it is not surprising to find that the average AP department not only lacks automation, but also lacks alignment and engagement with business executives. Paper-based processes make it almost impossible for an AP department to have or provide a full view into its processes much less the status of any specific invoice. This lack of visibility can create an environment where an AP staff can spend more than one-third of its time responding to internal and vendor inquiries is just one example of this inefficiency.
The report includes a long list of operational, financial, and supplier-based metrics that AP Leaders can use to establish current state performance levels and develop strategies to improve upon them.
To get the full report, click here (registration required).
