In recent years, Accounts Payable departments have been reaping the benefits of Invoice Workflow Automation (IWA) software. However, for many companies, processing paper-based invoices is still the norm: a new report has found that 84% of companies without IWA solutions handle the majority of their invoices via manual, paper based methods, and these are threatening their business bottom line.
Invoice Workflow Automation (IWA) Report
The report from Paystream Advisors found that although most organizations report their main pain points as manual data entry and inefficient processes, manual routing of invoices and high volumes of paper invoices, 30% are yet to consider introducing automation in their Accounts Payable (AP) departments. This is mainly due to a lack of available budget, or the belief that their current processes are working, despite the efficiencies that can be gained from IWA.
The report revealed that the financial sector is leading the way in terms of improving AP efficiency. The sector has been historically more progressive when it comes to back-office automation, and AP software is no exception. 60% of finance, banking and insurance respondents have adopted an IWA solution as opposed to only 22% of respondents in education, for example.
Greater speed and productivity
72% of organizations with an IWA solution see quicker approval times on invoices, 57% report greater productivity and 46% have said that their processing costs have come down after implementing an IWA solution.
Other benefits reported include improved visibility over liabilities (26%), improved compliance with regulatory requirements (21%) and a reduction in late payment penalties and interest (21%).
All these benefits can help to improve the bottom line and bring return on investment. Furthermore, the best IWA solutions adapt to an organization’s unique AP needs rather than forcing them to conform to the solution’s capabilities, and address the entire invoice lifecycle.
Achieving IWA success
The new report also provides advice on how to choose and deploy the right IWA solution for your business. This will depend on the organization’s AP operations and vary according to their size, industry, systems and processes and revenue. Organizations should properly map out their current state to pinpoint where improvements can be made, and which IWA provider would be best for them.
Key deciding factors include the types of invoice the organization mainly deals with, and mapping these by paper, EDI, fax, email, and web portal receipt type. This will help the business identify where they should start with their automation project. For example, a company with high volumes of paper may opt for a provider that enables a phased transition into more digitized methods without disrupting the status quo too rapidly.
Ultimately, organizations looking to improve productivity, speed up invoice approvals and reduce processing costs should move towards an automated invoice management environment. IWA solutions enable businesses to gain improvements in invoice approvals, employee productivity, and processing costs, immediately realising a return on investment due to improved productivity, efficiency and profit.
Find out more about Palette AP Automation here.