Looking for ways to improve your bottom line? According to one study, accounts payable is one area in which businesses can save money and resources. The benchmarking report found that companies can save 60% to 90% of the average cost per invoice by switching to AP automation.
AP automation is an approach that minimizes repetitive, manual, error-prone tasks that make up the accounts payable process, replacing human intervention with AI and automation. Adding a layer of business insights or intelligence to AP automation can save accounting teams time, money, and resources — streamlining the approvals process and optimizing business operations across the board. Businesses of all sizes can benefit from this, massively saving time and money.
One of the primary AP automation benefits relates to invoice processing. Even as the use of electronic invoicing increases, 51% of companies continue to struggle with manual processing. Manual invoice routing, lost or missing invoices, and difficulty matching invoices to payments compound the problem.
AP automation tools make this process run smoothly by extracting all of the invoice data with maximized accuracy for header fields — even extracting very valuable line-item data. This feature reduces room for human error, as well as wasted time spent manually checking and correcting said errors. This allows the Finance team to better understand which items are being purchased, for how much, and in what volume.
Faster approvals lead to higher productivity within your business, as well as higher rates of client satisfaction. Every other part of the company can work seamlessly without worrying if their software was paid on time or approved.
AP automation tools can be configured to deliver timely information to key leaders in the organization when they need it. Bills are often presented to stakeholders with no context. Approvals are held up while the stakeholder gathers information on the vendor, checks the bill for errors, and gets the information needed to ensure the bill is compliant. AP automation tools (like Glean AI) deliver complete records so the approver has confidence in signing off on key payments.
The ROI on an AP automation tool is high. According to one study from APP2P Network, the average monthly cost to process 5,000 invoices manually is $64,500. Deploying AP automation tools to process that same number of invoices would cost about $8,850: an 85% savings.
AP automation tools, including Glean AI, offer better reporting dashboards and data analysis to help make better financial and procurement decisions. Glean AI analyzes invoices at the line-item level. With this information, stakeholders can compare time periods, analyze line items, and understand changes on all vendor spend, including bills paid through AP or with credit cards. The result: actionable insights on all the drivers of all your vendor spend.
[Read more: 3 Easy Steps to Make Accounts Payable More Strategic]
Likewise, AI that is integrated into automation tools like Glean AI can produce deeper-level insights. Glean AI’s artificial intelligence can surface hard-to-detect trends, deep insights into core drivers, and areas of overspending to increase your ROI with vendors.
Learn more about the benefits of Glean AI by requesting a demo today.
Automated AP systems link all documents, messages, and approvals involved with each invoice, purchase order, and receipt creating a comprehensive record in the case of an audit. These records can help teams prepare for quarterly and annual filings, in addition to the audit trail that’s error-free and complete — no misfiled paperwork, receipts written on the back of napkins, or missing paper approvals.
Likewise, automation helps lower the risk of fraudulent charges. The AFP Payments Fraud and Control Survey estimated that 81% of companies were the target of payment fraud in 2019; since the pandemic, fraud is on the rise. Automation helps increase the chance of catching a fraudulent invoice before the payment is processed. Workflows with multiple people can be established with the assurance that automation will keep these workflows running efficiently. Adding multiple people helps create a series of checks for missing and incorrect (possibly fraudulent) data.
AP automation benefits extend to negotiating vendor agreements. Imagine arriving to the negotiating table with a record of on-time (or even early) invoice payments. In addition, automation has created a full record of information about the vendor: how much you purchased from them, delivery receipts, and more. Armed with this data, you’re in a great position to negotiate a better deal with this partner.
Many automated solutions collect line-item pricing data from your records, as well as benchmarking data from the entire industry. Benchmark your vendor’s track record with your company against industry standards. This type of industry data is invaluable when negotiating contracts or sanity-checking a supplier’s pricing terms.
AP automation workflows are often capable of interacting with other important business systems. Glean AI, for instance, easily syncs with QuickBooks and Xero, as well as other accounting tools. These integrations automatically sync bills, bill payments, and prepaid amortizations to your GL, saving time on reconciliations and eliminating costly errors.
AP automation can literally save your team hours. We estimate that a typical company can take up to 10 days to process an invoice; even those considered ‘best-in-class’ will take up to three days.
But, by removing manual steps from the AP process – from invoice receipt all the way through to payment – processing time can be reduced to minutes. Imagine what your team can accomplish with more time in the day. Your team of intelligent, talented financial and accounting professionals can focus on high-value business activities and spend less time on manual, repetitive, and error-prone tasks.
To learn more about the benefits of AP automation and Glean AI, request a demo, today.