Chrome River CURRENTS

At the best of times, a big customer paying late can make invoice processing less efficient, generating hidden costs. But for many small businesses, a late payment triggers cash-flow problems that affect the entire company, hurting profits and productivity at each step. Rather than holding customers solely responsible, companies should take a hard look at how their invoice management may be contributing to the problem.

Organizations often expect the CEO to provide strategic vision, but an article on CFO.com explains that the CFO can play a key role in scaling the company. To focus on growth, CFOs should first clear their desks of basic finance and accounting tasks by using outsourcing and AP automation, then use analytics to reveal financial obstacles and identify strategic opportunities.

Finance departments already routinely use online platforms to collaborate and communicate with users. Now, new mobile apps are proving useful for employees who work on the go, an article on AccountingToday.com reports. Whether your organization needs online expense reporting, document access or just a quick way to look up data, a mobile app may offer the most convenient connection to your accounting department.

The world’s biggest companies are eager to boost bottom lines by outsourcing such finance and accounting functions as invoice management, an article on AccountingToday.com reports. So far, however, relatively few have seized these opportunities for cost savings, improved efficiency and analytical insights.

With cloud-based services growing more robust and popular, automated invoice management tools present many businesses and organizations with new ways to cut costs. These tools, available as a Software-as-a-Service (SaaS) subscription, can ease or eliminate data entry and help managers control expenses through improved visibility.

In Part 1, we looked at the differences between manual and automated expense and invoice entry. So how does automated entry make Accounts Payable more strategic? Here are just a few of the ways that immediately come to mind.

Over the past 14 years, I’ve had the good fortune to be part of many business-process-improvement initiatives related to Spend Management. It’s been my experience that often, at first, the Accounts Payable managers are concerned about the impact on their department and can even be reluctant to pursue Accounts Payable automation altogether. I’m not sure if it’s the specter of the way robotics once replaced countless skilled workers in Detroit or the common notion that one day we will all be replaced by machines. It just seems like AP managers are often concerned about losing headcount and control over processes that they have owned for many years.

In a perfect world, your organization’s invoice management would be the last thing you’d need to worry about. It would be a secure, transparent and paperless operation, with accounts payable managing the process and approvers easily validating payments. However, with many vendors and suppliers still using paper invoices, the reality is that companies often fall back on inefficient and expensive manual processing.

As the economy recovers, companies may find vendors increasingly reluctant to accept long payment terms that stretch out 45, 60, or 90 days. And when one of your oldest, most trusted vendors requests 30-day terms, it’s important to keep the peace rather than risk disruptions. Instead, organizations can save by using automated invoice management to increase efficiency, prevent costly errors, and secure favorable terms from vendors.