As 2020 comes to a close, it’s time to build on all we learned and look forward to coming out stronger than ever in 2021.
The good news is we’ll all have new opportunities for new growth and stability by reallocating resources, trading out temporary solutions for long-term remedies and tackling problems that have gone unaddressed.
To help you and your company flourish next year, AvidXchange collaborated with the Institute of Finance & Management (IOFM) to create a new report identifying major trends that may help drive growth for your business.
Here’s a brief summary:
Trend One: Rising Tide of Electronic Invoices
If there’s one thing we learned from 2020, it’s that demand for automating AP processes is growing — fueled in part by the huge number of people who shifted to remote working.
Automating payments and invoices, rather than continuing to use paper, has become critical for businesses to keep their lights on.
A recent IOFM benchmarking survey shows that 66 percent of invoices are being processed electronically, and in 2021 that number could rise to more than 70 percent, according to IOFM’s executive editor Jess Scheer.
In sync with these trends, the survey finds that nearly three fourths (73 percent) use an automated AP software system, up from 66 percent last year and 45 percent in 2018.
“Organizations realize there are delays dealing with paper invoices, there are duplicates and there are redundancies,” said Scheer. “And they can get paid faster because those invoices can be submitted directly into the automated systems.”
Trend Two: Challenges Integrating AP Software and Accounting Software
Next year you’ll notice more companies than ever collaborating to integrate AP software, accounting software and Enterprise Resource Planning systems.
Companies will be working diligently to blend these software and systems to provide faster and easier ways for finance pros to use automated payment processes.
But there’ll be integration challenges — as there have been for several years. AvidXchange’s survey finds that only 35 percent of businesses are leveraging fully integrated systems to manage their financials.
More than three-quarters of finance teams are relying on at least two, and sometimes four or more applications to govern critical day-to-day processes. That complexity impairs productivity.
In 2021 integration of these systems for faster and easier connectivity will be – for certain – a high priority throughout the accounts payable software market.
Trend Three: Growing Importance of Data Analytics and Machine Learning in AP Software Market
In 2021, machine learning and data analytics will become more widely used for generating insights.
Here’s the best part. These insights will lead to more intelligent business decisions such as ways to deliver more personalized payment and invoice services to customers, vendors and suppliers at faster speeds and lower costs.
Data is a big deal in accounts payable software market.
As such, AP leaders will benefit from learning more about an increasingly popular type of data-centric artificial intelligence (AI) technology called machine learning.
In the world of AP software, machine learning processes and analyzes data to detect behavioral patterns of supplier payments and invoices and predicts the likelihood of those behaviors continuing.
There’s considerable awareness among finance pros about the benefits of this valuable technology. An AvidXchange survey reveals that 43 percent are familiar with AI and more than one-third (34 percent) know about machine learning.
Trend Four: Technology May Help Reduce Stress Levels
The understatement of the year 2020 might be that it’s been stressful. That’s been true for finance professionals as well as just about everyone else in the world.
For insights into the severity of these stress levels, AvidXchange conducted a survey of senior finance executives at more than 500 U.S. businesses to see how they’re holding up and what could make their work lives better.
More than two-thirds (78 percent) of respondents said new automation technology would help further reduce rising stress levels, and two-thirds (66 percent) said they have higher stress levels due to the impacts of the pandemic.
AP software will help relieve stress levels of finance pros by eliminating manual tasks and handling huge piles of disaggregated paperwork.
Final Thoughts
You’re about to embark on a great business journey in 2021. There will be challenges. But you’ll be in a fast-growing, super-cool market: using accounts payable software to simplify and accelerate payments and make peoples’ lives easier and more productive.
All the important trend lines are pointing upward. Celebrate this. Capitalize on the opportunities. Prepare now to experience unprecedented success in the coming year. And you will.
In the coming year you’ll be able to spend much more time thinking strategically and have a bigger impact on your company’s top decision makers, and you’ll gain more control of what you do during your workdays.
To read the full report, go to 2021 Outlook for the Accounts Payable Software Market.