We at Process-Smart completed a business process analysis to determine specific work flows, find waste and optimize information flow.
Outsourcing the accounts payable (AP) function is a powerful way to leverage overhead and revenue, and ensure that costs remain variable throughout a revenue or seasonal cycle.
According to one study, 78% of best-in-class businesses had adopted e-invoice processing technology compared to just 38% of their struggling competitors. The study also revealed that best-in-class AP departments who relied on procure-to-pay (P2P) automation derived the most strategic value.
However, adopting new technology presents an entirely new challenge in and of itself, especially for small and mid-sized businesses. Also, paying substantial fees or service charges to write computer code is likely not a viable path for small and medium-sized businesses.
We took the established AP processes for multiple clients and completed a business process analysis (BPA) to determine specific work flows, find waste and optimize information flow. We then used the existing client ERP/Accounting system (Netsuite, BC365, Aspire, Hyperion, SAP, etc.) via a protected virtual private network (VPN) to process invoices in a smart, semi-automated fashion.
Additionally, we utilized application programming interfaces (API), electronic invoicing and our AP team to generally take 50-75% of the cost out and translate it into variable cost.
Many accounts payable departments are still dependent upon costly and sluggish legacy systems such as optical character recognition (OCR). Some are also still heavily dependent upon paper invoices and checks. Retraining their workforces and overhauling their internal processes is a costly and burdensome prospect, so it tends to get put off.
However, those businesses that can incorporate automation, e-invoicing and other efficiency tools will gain an edge over their competitors. They also will negate many of the problems that have plagued AP departments for decades. Utilizing either augmented staffing or full-functional outsourcing is a powerful overhead leverage technique to optimize a small business.