Editor’s Note: Ardent Partners recently published our annual AP-themed report, The State of ePayables 2018: The Future of AP is Now. Today’s article is part of an on-going series focused on the report’s key findings. If you would like to get the full report, it is available for download here (registration required).
Last week I talked about how Accounts Payable can become more strategic to the organization. Many of you were probably off for the July 4th holiday in the US and missed my recommendations for AP to become more strategic that included becoming a better collaborator with other parts of the business, doing a better job communicating the value AP brings to the organization, and, thirdly, identifying key performance metrics and improving upon them on a regular basis. This week, I would like to add four technology focused recommendations that will help AP build its’ underlying infrastructure.
Unfortunately for many AP departments, they are often not first in line when it comes to getting funding for technology upgrades. The good news is what I am advocating does not require and ‘all or nothing’ approach to succeed. AP leaders need to identify solutions that can achieve both short- and long-term business goals. It is important to remember while formulating your plans that your digital goals and objectives do not simply address the immediate needs of just the AP function, but take a much broader, long-term vision that allows AP to also help to achieve the enterprise’s overall future objectives while providing increased value to key stakeholders along the way. Henry Ford once said “If I had asked people what they wanted, they would have said faster horses.” AP leaders beware, if you ask people what they want from AP, they probably will give you a very limited in scope, tactical answer. AP leaders need to be the ones crafting the vision along with input and collaboration of other parts of the organization such as procurement, treasury, business units, and IT.
Here now are my recommendations for leveraging technology in AP:
1 – Invest in technology to automate core processes
Paper-based and manual AP and payment processes will not get you to the promised land or enable you to transform AP into a strategic, value-adding function within an organization. Accounts Payable and procure-to-pay automation are foundational pieces of full source-to-settle digital transformation. The AP function will be unable to maximize its value and efficiencies if all key phases of its operational duties (including invoice receipt, approval workflows, and payment management) are not automated, scalable, and repeatable.
2 – Identify legacy platforms that can be enhanced or replaced
Many AP units find themselves in an interesting quandary: they possess some basic level of automation but not enough to allow it to keep up with other internal functions in terms of efficiency and speed. Not all AP automation platforms are built the same, nor do all legacy systems continue to drive the operational value they once did. Businesses must identify the legacy platforms that are in need of enhancement and build a long-term business case to improve and upgrade it or commit to a complete replacement with new solutions.
3 – Collaborate with IT to track new and emerging technologies
The rapid development of new business technologies continues unabated, with new solutions and innovations entering the market every month. AP should not feel pressured to be an “all-in” function in terms of the latest software and systems. It should however, constantly collaborate with the IT function to understand the possible impact of new and emerging technologies as they are most likely best suited to help AP (along with other parts of the business for that matter). Think about what is being talked about today in the world of AP and Finance, IT can provide AP assistance in more fully understanding the implications of new digital payment platforms and crypto-currencies, how to integrate artificial intelligence or machine learning into the mix, or even begin to frame the long-term ramifications of Blockchain.
4 – Develop a short- and long-term roadmap for aligning AP with the digital goals of the greater enterprise
We have all heard the saying ‘If you don’t know where you are going, any road will get you there’. This is especially applicable when discussing and designing the immediate and longer-term plans for AP in an organization. There are many technology options available today and many more coming down the road in the future. In order to be successful and add real strategic value to the organization, you need to map out both short- and long-term goals and objectives and how you are going to achieve them.
Conclusion
All successful projects are built on solid foundations. Building a successful AP department for today and the future requires having the right technology infrastructure in place. I have laid out some of the considerations you need to leverage in order to start the journey. It is important to remember that your roadmap will be a fluid document, one that you will invariably have to adjust and revisit on a regular basis to make sure it is still putting AP in the best position to succeed and drive value to the greater organization.
RELATED ARTICLES:
Download the State of ePayables 2018 Report!
The State of ePayables 2018: 3 Things AP Can Do to Be More Strategic
The State of ePayables 2018: It’s Time to Say Goodbye to Paper Checks
Monday First Thing: Exceptions are Meant for Learning, Not Repeating
