Common AP problems —and why manual processing makes them a thousand time worse
In the first article of the AP Automation series (read here) we spoke about what AP Automation is exactly, and why some are so hesitant to buy in. Now, we talk about why you need it in your company right now!
Imagine you’re driving down the freeway, and cars are zipping past you at breakneck speed. You’ve got an important appointment to make. At the rate you’re going, you’re never going to make it. You’re starting to get really, really anxious.
Then you look down and see…a horse’s back end.
Holy cow! You’re driving a horse and buggy! Not only is it slow, but it’s also dangerous. Not to mention uncomfortable. Chances are…you’re not going to make it.
Then you wake the heck up.
Okay. A nightmare like that sounds pretty ridiculous. But that’s basically you vs. your competition if you’re still doing your accounts payable manually in today’s increasingly automated environment.
To bring the analogy into the real world, let’s start with one simple question.
The answer is likely to embarrass you if you’re an AP manager. And if you’re an AP manager’s boss, it’s probably going to make you a little warm under the collar.
Here goes: How much does it cost you to process an invoice? Just one invoice?
According to the Institute of Financial Operations, more than 30 percent of AP managers don’t know the answer. But why does that matter?
Because the answer is extremely important for your business’s bottom line. According to Bottomline Technologies, processing a single invoice can cost between around five bucks for best in class vs. nearly $40 for the laggards—meaning you and your horse and buggy if you aren’t automated. In fact, according to the Aberdeen Group, non-automated AP is going to cost you about 83 percent more than using a modern system. That’s right—a whopping 83 percent.
And it’s not just the cost. If you’re still manual, you’re going to be clopping along in the slow lane if and when any of the following not-uncommon problems hit you.
Here’s a short list, and a quick explanation of how you can solve all your AP problems through automation:
- The check is in the mail. 📬
Are you or your employees sick of saying that to vendors who wonder where their money is? No wonder. On average, it takes more than twice as long to process an invoice manually.
- I know it’s here somewhere, part one. ☝
Seriously? If you can’t find vital information, you are leaking time and money. With an automated system, especially if it’s a cloud-based Software As A Service (SAAS) solution, you couldn’t lose vital information if you tried.
- I know it’s here somewhere, part two. ✌
Your desk is looking pretty scrappy with all those piles of papers and ledgers and mail everywhere. In fact, according to Scrap-bookers International, the only thing that will mess up your workspace more than scrapbooking your memories is manual AP processing. (Totally made up statistic, but you get the idea).
- What’s the plan? 🤔
It’s hard to make improvements and plan for the future when you don’t really understand what’s going on. AP automation is transparent. Big picture, small details—it’s all at your fingertips. Even better, mobile apps let you get the information you need any time and anywhere.
- The dreaded audit. 😱
Hey, it happens. But it’s so much easier with an automated system in place. And since errors are greatly reduced and compliance is often built in, chances are when audit time rolls around you’re going to like the results a lot better if you have a fully automated system.
- Bad Santa! 🎅
Theft and fraud is much, much more difficult with an automated system. Enough said.
Are you convinced yet? Ready to hop out of the buggy and get behind the wheel of something new and sporty? Great! Now all you have to do is convince your boss.
We’ll cover how to handle that in our next post. Meanwhile, if you’d like to check out our first post on AP automation, you can find it here.