Effective management of the Accounts Payable process is vital for any organization, especially those looking for fast growth! In this e-book you will discover how cloud technology enables organizations of all sizes to benefit from the efficiencies associated with AP automation, including lower costs, better visibility and control of day-to-day cash flow & better supplier relationships.

Find out how cloud-based AP automation works, 5 Key areas that best-in-class AP teams should be focused on in 2015 & 5 critical considerations that must be made before choosing cloud AP automation. Read on to discover how the cloud can bring you one step closer to world-class AP processing - without the pressure of captial intensive investments.

Why Is Effective AP Management So Important?

Managing the Accounts Payable (AP) process effectively can have a big impact on the profitability of a business. Effective AP management is characterised by good cash-flow management and good supplier relationships. Cash-flow can be managed by controlling when invoices are paid and what terms are included in each payment.

Cash-flow management becomes far easier when businesses have good relationships with their suppliers. When businesses pay bills on time, they build the trust of suppliers and better position themselves to negotiate discounts and better payment and delivery terms. Suppliers will also be more likely to recommend better products and services.

As a business grows, however, so does the volume of invoices it will have to process. In this situation, effective AP management can make the difference between overall success and failure during growth. With a higher volume of invoices to process, errors like processing fraudulent invoices, duplicating payments and incurring late payment charges all become more likely. Making these sorts of errors can negatively affect a company’s reputation and its bottom line.

Although efficiency in the area of AP is important for small and large businesses alike, an inefficient AP process can have potentially business threatening repercussions during high growth periods.

Efficiency Through Cloud-Based Automation

Any business can now use Cloud-based Software as a Service (SaaS) solutions, like ReadSoft Online, to automate the AP function.

Cloud solutions mean that a business can adopt a complete solution for invoice capture and processing with minimal IT or time investment. Historically, additional hardware and software would have been required from the outset, but with the SaaS model businesses can experience the same results without the initial investment.

If you are thinking about how you can improve operations in your AP department in 2015, then improving efficiency will be the key priority. The best way to improve business process efficiency is automation. Automated processing and workflows help reduce inefficient and complex processes that can present a significant cost burden to a business.

How Cloud-Based AP Automation Works

• Invoice arrival and capture
  • When an invoice arrives by paper, you simply scan and upload it to the cloud. Invoices arriving by email, fax, XML, or other electronic form enter the cloud directly. How Cloud-Based AP Automation Works
• Processing in the cloud
  • In the cloud, the invoice is automatically captured and interpreted. Data from the invoice is extracted, while an image of the invoice is saved for downstream archiving. The invoice image and data are immediately available for verification. Once verified, the invoice can be automatically entered in your finance system.
• Managing invoices
  • Once the invoice is verified and entered, the invoice can then be managed using workflow and approvals for optimal processing and management. Finally, the invoice data complete with accounts coding is sent to your finance system for final posting, payment and archiving.

There are 5 key themes that leading AP teams will be thinking about to increase process efficiency in 2015:

• Handling increased invoice volumes
  • In a world of global connectivity and 24/7 business, most AP departments are facing increasingly high volumes of invoices. AP teams in 2015 will need to be looking at how to handle this increased workload effectively, without adding additional costs to the business. Some of the activities below will be beneficial in addressing this challenge.
• Deploying mobile solutions
  • Mobile solutions for financial professionals are already gaining mainstream success and they can add huge value in improving financial processes. 2015 will see an increasing number of AP teams adopt mobile solutions to improve efficiency.
• E-Invoicing is the future
  • With e-invoicing legislation looming, the practice saw significant growth in 2014. In the year ahead, AP teams will need to understand exactly how e-invoicing integrates with AP automation in order to improve the entire P2P process chain. E-Invoicing incorporation promises to produce the most significant efficiency and cost-saving benefits.
• Deploying analytics
  • Big data is a big deal. This applies to AP departments as much as any other function. Understanding your data, what is relevant and what to collect, and then making sure it can be analysed and reported accurately will be an important consideration for AP departments in 2015. To address this effectively means uncovering bottlenecks, identifying trends ahead of the curve and being able to share and edit information quickly. Ultimately it means working smarter and more efficiently.
• Deploying cloud solutions
  • Cloud technology offers a huge amount of flexibility for improving financial processes and is the primary enabler for mobile solutions. Cloud solutions also make AP automation a possibility for small and medium business that would previously have been priced out of comprehensive on-premise software solutions. Cloud software also allows businesses to implement an automation project without leveraging significant internal IT input.

Five Critical Considerations Before Choosing Cloud AP Automation

While the cloud offers much promise to firms seeking the full benefits from automating their invoice processing, enterprises must proceed thoughtfully in order to achieve optimal performance.

The checklist on the next page can be used as a guide to ensure the credibility and high-functionality of an AP solution in the cloud. Unlike traditional on-premise solutions, these applications are built on top of a hosted platform space. A solid cloud platform must also be in place to ensure that company’s needs for security and reliability are met.

Cloud Considerations

1. Examine the provider’s level of experience and expertise with data capture and automated workflow.
   1. How many years of experience in AP? A vendor with more experience will be able to address the unique challenges of invoice processing over other financial processes.
   2. Where are the solutions developed? If the vendor outsources the development of the solutions, or has recently acquired the developer without previous knowledge of the process area, accountability can be compromised.
   3. What’s the reputation of the vendor’s support services? Choose a vendor that maintains in-house support services, and that has an experienced and loyal employee base.
   4. What is the size of the vendor’s customer base? The more proven success with other enterprises, the better. Check for diversity in size and with industry.
2. Ensure that the solution can integrate with your organization’s ERP system.
   1. Check to see if the solution is being utilized by other organizations with the same ERP system.
   2. Are the solutions certified with ERP systems? ERP-certified solutions have been rigorously tested, and certifications communicate a working relationship between the solution and ERP providers.
3. Evaluate the quality of the solution’s OCR (optical character recognition) intelligence.
   1. How accurate is the technology, and how does it drive efficiency in invoice processing? Accuracy at the front-end of AP processing will deliver compounded benefits.
   2. Is a template required for every vendor? If so, efficiency is compromised.
4. Determine the breadth and depth of the solutions’ functionality.
   1. Can the solution support straight-through processing–from invoice entry to transfer, allocation and approval? Best-in-class firms maximize the impact of automation on all AP processes.
   2. Is it scalable? It is important to choose a solution that can grow with your organization.
5. Ensure Security and Reliability
   1. While organizational leaders have gained much more confidence in the platform, data privacy and security concerns over holding financial data in the cloud remains a key inhibitor to SaaS adoption. Leaders too are intimidated by the fact that their company’s business processes will be, in effect, moved outside of the environment–resulting in a shift in accountability for supporting the technology (from IT, to the hosting service provider).