The constantly evolving nature of the Accounts Payable (AP) process has a tremendous impact on businesses in that field, and in their search for reduced costs, increased efficiency and a more streamlined process, companies considering outsourcing and automating the AP process must remain aware of the trends shaping the field.
Here are some predictions for the future of AP, courtesy of the web site CPORising.com:
- The AP process will become even more automated: In the face of increasing executive goals to reduce costs at all levels of a company, AP teams are finding they must automate (or outsource to a provider relying on automation) in order to achieve department-level goals. Automating the front end of the AP process, specifically invoice receipt and approval, can result in a significant reduction in per-invoice processing costs, which can lead to enormous savings down the line. The obvious economic benefits of automation means that this trend will continue – and increase – in the future.
- AP’s involvement with cash management will continue to grow: One of the main goals of AP is to distribute enterprise cash to suppliers, which can make AP the largest source of cash outflow in a company. AP’s role in this process makes it a natural partner for a company’s treasury function, especially regarding cash forecasts and financial planning. An efficient AP process, relying on automation and technology, can help a company decide which early payment discounts to pursue and provide more data with which to create more accurate financial forecasts.
- AP will become more strategic: As the invoicing process becomes more automated, AP can move away from merely focusing on tactical activities and provide intelligence about the data that is being collected. This information that can be used in elements involving treasury and procurement that can lead to long-term strategic planning across the board.
As the CPORising.com article says, AP holds a unique position in any enterprise. Any purchase that involves an invoice (and many that do not) flows through the company’s AP process. That why AP is in a unique position to become a “hub” of financial and operational intelligence. As it continues to evolve and rely on greater automation.