What makes Best-in-Class organizations different than other organizations? While there are many different traits and characteristics you could point to, the one that stands out, above all else, is not being satisfied with the status quo or to put it a different way, looking for a better way to get things done. One key way to improve processes and procedures and do tasks in a more efficient and cost-efficient manner is to invest in technology.
Ardent Partners research has consistently shown through the years that manual, paper-based processes are inefficient and cost significantly more than digital processes. B2B payments have typically been the most manual, labor- intensive part of the AP process and has yet to receive wholesale automation. Over the past 10 years, Ardent Partners’ research has shown is that investing in technology will result in serious productivity and cost gains when it comes to B2B payments
Paper checks may have functioned “well enough” in the past, but digital and electronic payment solutions have started to capture the attention of finance and AP leaders. This is in part due to a more holistic (and expanded) focus on the role of AP related to both invoice and payment processing. However, while many organizations may just now be investigating the move to electronic payments, Best-in-Class organizations have been adopting the technology and reaping the benefits for years.
In Ardent’s 2019 State of ePayables research report, Best-in-Class organizations were shown to be 71% more likely to use electronic payments, and Purchase-to-Pay automation in general, as compared to all other organizations. The result is a not surprising almost 6x cost improvement to process an invoice from receipt to approval and through to payment. Best-in-Class organizations also are able to pay invoices more than 3x faster.
Over the last five years we have seen the shift to electronic payments slowly improving and today 55% of all B2B payments are electronic with ACH and card payments being the most used formats. While there has traditionally been a greater focus for AP departments automating the front end of the process, more and more organizations are realizing that B2B payment solutions are vital to realizing the full potential of AP and P2P automation. When it comes to automating B2B payments, there is a huge opportunity for organizations that want to lower costs, improve cash flow, and eliminate manual, paper-based inefficiencies. One need look no farther than the results that Best-in-Class organizations have achieved to see that an investment in B2B payments can pay large dividends.
