The accounts payable automation solution market size is forecasted to grow from USD 1.9 billion in 2019 to USD 3.1 billion by 2024, at a Compound Annual Growth Rate (CAGR) of 11.0% according to Markets and Markets, a provider of quantified B2B research currently servicing 7,500 customers worldwide.
In today’s ever-increasing digital landscape and rapidly evolving business climate, automating the accounts payable processes has become a necessity in consideration of the accounts payable’s highly-essential business function in an organisation. Accounts payable, which was once perceived as a traditional and transactional back-office function, is now also known to provide intelligence for business-critical finance data.
The shift on accounts payable’s perception has led Shared Services & Outsourcing Network (SSON), an online news source for global business services executives and business leaders, to study the leading trends and the key role of technology in the AP’s ability to optimise cash flow. In this white paper, the Australian and New Zealand market was analysed.
Creating New Opportunities Through Automation
Aside from leveraging new skills within AP teams, closer collaboration with procurement, and communication throughout the business, the shift in AP’s strategic mindset has put more emphasis on deploying the right accounts payable automation solution. Automating AP enables visibility into the business-critical data for improved financial control, spend visibility, and cost-saving potential.
The whitepaper has revealed the key benefits of providing the right end-to-end accounts payable automation solution in an organisation’s over-all operational efficiency. These are:
Analytics for better decision-making
Needless to say, automation frees up the AP teams from the manual transactional work and leaves them more time on accomplishing more strategic tasks. Furthermore, AP automation solutions’ cognitive capture and analytics capabilities deliver business value for better decision-making. The intelligent technology provides real-time, accurate, and immediately useful information to help effectively manage working capital.
Accurate data for increased efficiency
In the SSON research, only 24 percent of respondents have a fully automated invoice processing solution that includes optical character recognition (OCR) in place. The opportunity is in capturing the most comprehensive information and validating it upfront to reduce invoice processing costs and ensure the data required for analytics and insights are available for future use.
With the appropriate AP automation solution, data extraction from invoices, no matter how complex or how invoices enter the organisation, will be optimised. Only when data are complete and accurate will automation be effective in increasing AP’s efficiency.
RPA for gapless automation
Robotic process automation (RPA) allows organisations to create truly seamless automation with its capability to fill in manual gaps between process steps and systems. RPA that sits on top of an organisation’s existing technology complements core systems like SAP and non-disruptive for day-to-day business. Together with an AP automation solution, RPA becomes an affordable option to automate recurring processes, eliminate data entry errors, and cut the processing time.
Capabilities for a seamless SAP integration
According to SSON, one of the key attributes of a comprehensive AP automation solution is the capability to integrate with an ERP. Critical AP automation solution components such as RPA, multichannel capture, best practice workflows, end-to-end analytics capabilities, supplier portals, and cloud-based services boost SAP system’s value by providing additional functionality and seamlessly integrating information directly into critical business systems from any location.
Digital Platform for improved customer engagement
With only three percent of supplier queries dealt on an online portal as uncovered by SSON, there is a loss in opportunity for the organisation. In today’s digitally-savvy population, businesses are expected to interact with its customers including suppliers, partners and even internal customers through a convenient digital platform. Integrated self-service supplier portals have dramatically improved vendor relationships by simply offering transparency and convenience.
The New AP Mindset Applied
Koppens Developments, a civil construction and development specialist in North Queensland, Australia has applied some of the key points uncovered by SSON on the AP perception shift. The company tapped Kofax, a California-based automation software provider known for its RPA solution, to modernise and digitise its end-to-end invoicing lifecycle. Specifically, Kofax TotalAgility was chosen to digitise invoices and automate workflows for the construction firm.
Kofax TotalAgility is a digital transformation platform that accelerates high-value customer journeys such as new customer onboarding, claim processing, loan automation, citizen service provision, and supplier management among many others.
Business Solutions Manager Jarrad Koppen shared:
“We currently process up to 14,000 invoices every year and have a team of three people handling it all. In the past, our staff relied on largely manual methods to manage invoice processing. As we grew, we recognized that such an approach was quickly becoming unsustainable.”
“Turnaround times were slower than we would like—putting us at risk of failing to pay suppliers on time. What’s more, the sheer volume of work made it challenging for us to gain fine-grained insight into costs and payments; insight that we need to ensure that we do not overrun our budget for a given project,” he detailed.
With Kofax TotalAgility, Koppen Developments has now automated end-to-end invoice processing, significantly cutting the processing time of a single invoice from one hour or more to just three minutes. Koppens explained that with faster invoicing, the company could take on more work in AP without increasing headcount, which consequently helps make the business more profitable.
Project Manager Martin Wojcicki added how the Kofax solution has enabled Koppens to gain deeper insight into its AP data helping the company sharpen cost control to keep projects on budget. He said:
“With Kofax TotalAgility our team can capture much richer detail from invoices, right down to line item level, which is something they simply could not do in the past. We use this invoice data in conjunction with information such as purchase orders and actuals to feed our business intelligence engine, which gives us a much more holistic view of project costs. Now that we have this insight, we can make decisions based on real evidence rather than best guesses.”
The Koppen Developments’ success story with Kofax is just one example of how automating the AP processes goes over and above eliminating manual tasks. With the right accounts payable automation solution, AP can substantially contribute to an organisation’s overall success through better cash flow management, improved operational efficiency, and as an intelligence hub for when creating critical business strategies.