AP Automation Digital SummitNovember 16, 2022
New accounts payable skillsJanuary 3, 2023
Tips for an AP invoice processing standardization plan
Many enterprises are already working on their AP invoice processing standardization plans. They aim to reduce the cost of processing their invoices globally by working more efficiently and faster. To achieve that, these plans usually involve the injection of automation into the AP process.
At Cevinio, our expertise lies in providing automated invoice processing to corporations with shared service centers. We do that through the implementation of a software solution that allows a standard operating procedure for invoice processing across offices and entities. We have successfully helped numerous companies achieve efficiency in their global invoice process and save costs. Below, we have compiled valuable tips to aid you in effectively implementing a standard AP invoice process.
Problems large companies are trying to solve with AP invoice processing standardization:
The first step towards invoice processing standardization is to have a clear view of the objectives and problems you are trying to solve. In most cases, the decision comes with the implementation of a global AP invoice automation solution. Such a tool acts as a vehicle for standardization and fixes the problems we list below:
- Low accounts payable productivity. A highly manual AP invoice process can be time-consuming, leading to delays in invoice processing and decreased efficiency.
- Handling both global and local compliance requirements adds complexity to the accounts payable process. Companies operating across different regions must adhere to diverse regulatory frameworks, leading to increased compliance challenges. This can result in potential errors and penalties if not managed effectively.
- Lack of consistency and transparency in the accounts payable process. Confusing processes and unclear records can enable fraud to occur without anyone noticing, causing harm to the company’s finances and reputation.
- A high percentage of exceptions. When a significant number of invoices require manual intervention or resolution. This results in increased processing time and additional administrative costs, impacting the overall efficiency of the AP process.
- Late-payment fees and compliance-related penalties. For example, late invoice processing and payment can lead to penalties, impact supplier relationships, and disrupt cash flow for companies.
- Handling invoices in different flows in a timely manner. Invoices from various suppliers and regions may have different processing requirements and timelines. It is essential to establish efficient workflows to avoid delays.
- Lack of data and analytics to optimize the process and transparently calculate KPIs. Without proper data and analytics, companies cannot identify bottlenecks, or track performance metrics.
- Global working capital control. Efficient accounts payable is important for managing money well, making sure there is enough to pay bills and invest.
- Proper workflow distribution. Efficiently assigning tasks and approvals among team members ensures smooth invoice flow, reducing processing time and enhancing productivity.
If these are issues you recognize, we invite you to continue reading this blog. We will talk about the first steps toward a standard invoice process. We will also cover how to approach the selection of the right AP automation software solution. We want to help you not miss any opportunities.
First steps toward a standardized AP invoice processing
Standardizing your invoice processing globally is certainly a big project where challenges and obstacles will come your way. By being well-prepared and counting on the right technology you will be on the path to achieving your goals. Below we share our hints and tips for a successful standardization of your invoice process:
- Blueprint. The standardization process will go smoother if there is a properly developed blueprint. The project teams should design this document before (but not in parallel with) jumping into action. The new process and the requirements should be described from the very beginning to keep things under control.
- Mindset. When creating the description and implementing the standardization, it is also all about the mindset.
A good approach is to think the “scenario way” with end-to-end processes. Then, you can test these scenarios with the right stakeholders with a couple of examples before going live. It is also important to avoid shuttered vision. Why? By designing and testing process parts separately, we may miss some gaps.
- The change management plan. Speaking about new processes and the teams involved, we cannot avoid the topic of change management. A change management plan should be a part of the process from the very beginning as it can bring numerous benefits.
The AP teams need to trust the new AP process. Only then they will take ownership, and be directly accountable for the success of the new process.
- Focus on high-volume invoice scenarios. Once you have a team, they could start working on understanding and describing existing invoice scenarios. Structure them by volume and then focus on the high-volume scenarios that can be standardized.
- A small and dedicated team. Despite the complexity of invoice process standardization, involving too many participants may lead to chaos. To be clear and effective, keep the project team small and use tools to include different opinions.
- Reliable communication channels. Establishing communication channels among all stakeholders in the process presents challenges. The more opinions you seek to consider, the greater the number of people involved in developing the new standard process.
Hence, finding the right balance is crucial. Maintaining a small, capable core team while efficiently gathering input from a broader range of stakeholders. Additionally, establishing a direct connection with true experts possessing relevant experience, especially on the vendor’s side, is of paramount importance
- Reliable vendor. Make sure that the AP invoice automation software you select provides an advanced solution able to support this quest.
Choosing the right accounts payable invoice automation software
When searching for AP invoice automation software, the many options in the market can be overwhelming. To mitigate this challenge it is important to know what your company needs.
Global companies possess unique needs and challenges, yet they also share certain similarities. Among these commonalities is the requirement to automate their invoice process on a large scale. Hence, the initial step should involve identifying a vendor with experience in implementing solutions at a global level. This indicates their capacity to offer the features required, along with the expertise to tackle potential challenges that may arise.
At Cevinio, we have experience helping global enterprises standardize their invoice process, becoming specialists in this arena. If you want to know more about our AP invoice automation solution, please contact our sales team. Your journey towards an advanced global invoice process can start today.