5 Reasons To Optimize Accounts Payable Process

Posted by David Storey | Jul 02, 2017

Having already deployed Oracle JD Edwards, you understand the benefits of automating key aspects of procure-to-pay(P2P) operations. However, as long as paper remains part of the picture, you are missing out on opportunities to further cut costs and reduce inefficiencies.

Accounts payable automation can immediately and positively impact your bottom line and is an obvious extension to optimize your accounts payable process. If you are having difficulty convincing your CFO to take the plunge and automate AP, talk him through some of the benefits below.

1. AP Automation substantially reduces costs


The argument for AP Automation with JD Edwards EnterpriseOne can be made at a really basic level. Without even looking at the ROI of increased productivity or greater data accuracy, automating accounts payable saves money on:

  • Processing Time: How long does it take to process a single paper invoice as it makes its way along the approval chain? And when an error occurs such as incorrectly entered data into the financials system or a missing purchase order number, how many days does it then take to get documents back in-hand for correction?
  • Transportation: How much money and time is spent on inter-office mail to send documents from a regional office to a central location, or even between people in the same building?
  • Storage: How many filing cabinets or rooms are filled with archived invoices, taking up valuable real estate that could be used for more productive purposes?
  • Filing, Finding & Reproducing Docs: How easy is it to search for and locate archived invoices once they have been filed away? According to The Association for Information and Image Management (AIIM) costs for filing, finding and reproducing documents are
    • $20 in labour to file a document.
    • $120 in labour to find a misfiled document.
    • $220 in labour to reproduce a lost document.

2. AP Automation delivers real productivity gains


AP Automation helps people do their jobs more efficiently and it frees them up to spend time on higher value added tasks. With AP Automation, you are able to work smarter by relying on capture, imaging and workflow to automate some of the most time consuming and mundane tasks of procure-to-pay operations. What’s more, with real-time monitoring you can easily identify and resolve any process bottlenecks.

3. AP Automation delivers cash savings


By streamlining procure-to-pay operations and dramatically decreasing the time it takes for data entry, exception handling and approvals, you can reduce invoice processing time from weeks to days. This means you can negotiate vendor discounts by meeting early payment terms and avoid late payment fees.

4. AP Automation is a source of competitive advantage


According to the Aberdeen Group (May 2012), the time difference for invoice processing between “Best in Class” companies and the bottom 30% can be up to 12 days. "Best in Class" companies process invoices from receipt to payment in 4.1 days on average, whereas for companies in the bottom 30% it can take up to 16 days. Similarly, “Best in Class” companies have a 90% capture rate for available early payment discounts compared to an industry average of 47%.

In a climate of increasing competition and tight margins, optimizing accounts payable process and being better at leveraging supplier discounts can make a real difference. What’s more, while AP automation is not quite mainstream yet, with “digital disruption” now firmly on CEOs agendas, it is likely to become the norm in the not too distant future. Wouldn’t you like to get a head start on the competition?


5. The Big Picture: Contribute to the overall goals of the company


We all want to contribute, to carry out work that will significantly affect the performance and results of our companies. In reality, we often get caught up in the day to day routine and end up focusing on tasks rather than on the key projects that will really make a difference. Optimizing accounts payable process​ with AP Automation is one of those opportunities where you get the chance to cut costs, improve productivity and free your colleagues from mundane, time-consuming tasks. 


Conclusion


So what are you waiting for? With Redfaire’s out-of-the box AP Automation solution for JD Edwards, developed using Oracle WebCenter, your automated invoice processing can be up and running quickly with minimum disruption. What’s more, AP Automation only needs to be implemented in the beginning, ECM has potential throughout the organisation, HR, Production, Legal.

To read more about our AP Automation solution click here .

Having already deployed Oracle JD Edwards, you understand the benefits of automating key aspects of procure-to-pay operations. However, as long as paper remains part of the picture, you are missing out on opportunities to further cut costs and reduce inefficiencies.

 



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