But what and where should you focus your effort to make sure you achieve the maximum benefit? Here are our seven rules:
Rule 1 – Drive through efficiency gains to reduce costs
Even with the advent of network computers and email, Accounts Payable in many companies is still largely a manual and time consuming process, driving down staff productivity and keeping costs higher than they need to be. By implementing AP automation you could achieve savings of 40-60% on AP costs, many getting a ROI within months.
Rule 2 – Don’t implement new policies if you have no way to control them
Policies and procedures are not enough. Documentation and methods to enforce internal controls are also needed to make financial commitments and regulate cash flow. Best practices in terms of policies and technology will work successfully side by side, providing the necessary control to enforce the procedures that have been established.
Rule 3 – Make the most of technology – subtle enabler to policy enforcement
Let your users blame the system rather than the managers. Technology such as e-invoicing can enforce compliance with your company policy and prevent unauthorised workarounds. For example if you don’t have the authority to use a given cost code you cannot assign a cost to that code, nor can you approve expenditure above your approval limit. Cash management can now be done more proactively, with all information centrally available, whereas manual record-keeping is impossible to track.
Rule 4 – Use KPI to constantly measure and improve
Before you can accurately determine and implement improvements you need to be able to measure where you are today and where you want to be. It pays dividends to find out how you are doing in comparison to companies in your sector, so use Key Performance Indicators (KPI) to define measures that are appropriate to your organisational objectives and take stock of your current situation.
Rule 5 – Integration and flexibility is key
Who knows what is around the corner. Who could have predicted Enron and the subsequent introduction Sarbanes-Oxley Compliance for any company trading within the US? Your system needs to change and adapt with the times, change is the only constant.
Rule 6 – Address the whole process right through to payment
It’s particularly advantageous for businesses intent on making the most of faster invoice approval cycles to be smarter about controlling when the invoice is paid, perhaps even negotiating more aggressive early settlement discounts in return for faster payment.
Rule 7 – Get those suppliers onboard!
The challenges associated with supplier onboarding are well documented, but by considering a fully integrated Accounts Payable (http://www.accountis.com/
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Accountis Europe Ltd is an international provider of e-invoicing and payment services including Accounts Payable (http://www.accountis.com/
Founded in 2002, Accountis became part of the Fundtech group in early 2008 and processes over 1 million transactions every day. The Accountis trusted transaction network is used by many of the World's largest corporations to leverage existing systems and maximise efficiencies across the financial supply chain.