Accounts Payable Automation is the process of re-engineering the accounts payable process to create and improve efficiencies. More often than not it involves digitisation and centralisation of a process that is currently manual and paper-centric. When done correctly an AP Automation project is not just automation of the current process, it is a complete re-imagining of the process.
Organisations are drawn towards AP automation projects because they offer a very large set of potential benefits. These benefits include cost reductions, accuracy improvements, resource reallocation, improved cash management, access to early payment discounts, avoidance of late payment penalties, improved vendor relationships and increased staff satisfaction just to name a few.
Unfortunately for most organisations they need to run a change project before they can access those benefits. This can be challenging as history tells us that approximately 50% of change projects lead to frustrated delivery (failure to deliver on time, to budget and / or the full scope) or completely failed delivery.
We have put together our top tips to avoid being in the 50%. Here they are;
1. People Leadership.
It should come as no surprise that people leadership sits at number 1 in our list. Despite the significant advances in labour management since the Industrial Age we are still seriously deficient in the way we lead our most valuable resource through these change projects.
If you want to improve your people outcomes on a project then you need to start the communication about the project (what it is, why it is needed, how it will impact the individuals etc.) with the team early on and where possible engage them in some of the decision making. It is important that organisations also let the team know what the non-negotiables for the project are. Allowing team members to think they can change an outcome that is a non-communicated non-negotiable is just a waste of energy that will become a massive de-motivator for the individual when they eventually work out that it is non-negotiable. For this I will use the Bus analogy. The team need to know that the bus they are on is going to a new destination. They need to know that the destination is not open for debate, however, what is open for debate is some of the semantics relating to the journey. e.g. which seat they will take, will there be stops on the way etc. Having the courage to engage the team early will lead to superior project outcomes.
Your project team will need good levels of Executive Support. The key people on the project need to know they have the backing of the executives. They need decisions made in a timely manner and required resources made available to ensure success. They also need executives to step in where needed and remove roadblocks.
Engage your IT department early. In our experience the IT department will be a great ally on a project like this if they are engaged early and are able to make sure their input is heard. The modern IT department is usually very concerned with delivering business value and they will want input. On the contrary, bringing the IT department in late will lead to your frustration as you have to wait while they go about their normal checks and balances.
The final people leadership tip we have is to look after your Subject Matter Expert (SME). Most organisations have a person that is central to the successful operation of the current AP process. This person will be in high demand as you set about planning an automation project. They need to provide significant input into the project. The problem is that these key resources are generally already over-utilised in their normal working week. Having them contribute a significant effort to your project will leave a big hole in the current process that will cause many issues. What normally happens is the day-to-day operational issues take priority on the project and the project slips well out into the future. Good leadership here plans for this resource issue by back training other resources into some of the key components of the SME’s current role. That allows them to be freed up to participate in the new automaton project without significant negative impacts to the organisation.
2. Consider Cloud Deployment.
Research* has shown that cloud delivered AP solutions are 100% more likely to deliver real time visibility into an organisations cash position. This is just one of the benefits that organisations can enjoy when they choose a cloud deployment model.
A cloud deployment model will provide stakeholders access to information when they want it from anywhere in the world. Any modern cloud based solution will offer mobile access to information as well as allowing staff to process their workflow tasks on their mobile device as well.
A less known but hugely compelling reason to choose cloud deployed solutions for AP processing is based around the skills required to maintain that type of solution. Corporate IT Departments have many IT skills but few of them are specialists in document capture, document management, workflow and data integration. When these technologies are deployed in the cloud your cloud hosting partner will have these skills. That way when there is an issue you can rest assured that the right resources with the right skills will get it resolved quickly.
3. Choose an Integration Capable Solution.
Even if your first project stage does not require integration with your ERP, it will likely be a future need. AP automation solutions that provide maximum ROI need to access vendor, PO, receipting and other critical information from the ERP so that they can make informed approval routing decisions. They will also need to be able to pass electronic invoice data back into the ERP so that human labour is not needed to do it. None of this can happen if your solution does not have a strong integration capability. This capability will also be essential if you plan to use the implemented platform to automate other key business processes. e.g. HR Automation, Contract Management, Customer Service Processes. In the information Age companies that are able to effectively connect their technology have a significant advantage over those that cannot.
4. Partner with a Trusted Advisor.
Generally an organisation will only run one AP Automation project and it is impossible for it to be a core skill of the organisation. There are a number of companies, like ours, that do plenty of these projects. Probably the biggest influence on your potential success will be the quality of the partner you choose to do the project with. Engaging a company like ours will enable you to tap into decades of process re-engineer and technology deployment experience. When deployed for your benefit this experience will underwrite the risk associated with running such a large change program.
Hopefully these tips help you deliver a successful AP Automation project. If you would like to meet with us to discuss your specific project please email us at email@example.com.
*Ref. Aderdeen Group 2015, Bring Invoice Processing Costs Back to Earth with AP Automation in the Cloud.