Accounts payable (AP) automation is a technology solution that accounting teams can use to digitize invoices and automate processing, including approval routing, coding, and executing payments. This tool can be used alongside an organization’s preferred accounting software to promote increased productivity, among other AP automation benefits.
AP automation is designed to reduce manual, time-consuming tasks and provide benefits to AP departments that need to streamline disorganized and inefficient workflows. The software can enable visibility into the status of individual invoices as they move along the automated pipeline.
From a workflow standpoint, automating AP can cut the number of steps financial pros need to take to process, approve, and pay invoices. All that can translate into faster payments and better relationships with suppliers, as it helps them get paid more accurately and on time. AP automation can also help companies potentially gain opportunities for early payment discounts from suppliers.
AP Automation Benefits
While AP automation benefits organizations in many ways, we’ve outlined five important AP automation benefits below.
1. Reduce Human Errors and Improve Accuracy
Accuracy is important when dealing with invoices and payments. There’s an opportunity for errors when AP staff are asked to manually enter data, as information may be keyed into the wrong fields or dropdown boxes. Mistakes sometimes slip through the cracks, but the right AP software can help reduce human errors.
Automatically capturing data, matching invoices to supporting documents, and coding invoices can help reduce errors and inconsistencies while saving valuable time.
2. Aid in Business Growth
When businesses begin, they usually only need to process a few invoices per month. As the business grows, the number can swell to hundreds or even thousands. As invoice volumes increase, AP leaders must decide how to handle them.
Some companies hire more staff, which helps get the job done but adds costs. Alternatively, AP automation is designed to enable accounting teams to handle increased volume without adding headcount.
3. Free Up Time for Strategic Initiatives
Many AP pros spend their workday on repetitive tasks. Some AP leaders may spend more time each workday on transaction processing instead of department planning, staff training, and other managerial tasks they were hired to perform. As a result of these time-consuming manual tasks, strategic initiatives often get pushed aside.
By investing in AP automation, AP staff can free up time to focus on higher-level work such as analyzing data to make better business decisions. AP automation can also lead to more satisfying work and higher career satisfaction. According to our 2023 AP Career Satisfaction Survey, AP pros with fully and largely automated systems are almost twice as likely to be “very” or “extremely” satisfied with their roles compared to those who are reliant on manual systems.
4. Unite the AP Workflow
One AP automation benefit is that it can help unite the workflow of team members, giving AP staff the visibility they need to work efficiently. With automation, AP pros can quickly pick up tasks where others left off and more efficiently handle anything that comes across their desk.
Responding to an ad hoc payment or invoice request can take hours or even a full day in a paper-based AP process. With automated solutions, AP pros can simply log in to the online portal and quickly get the answers they need.
5. Strengthen Supplier Relationships
Relationships are key to business-building, and poor payment practices can quickly derail them. Automated solutions are designed to help improve “on-time” payment records with suppliers by enabling AP teams to track and pay invoices more efficiently.
AP automation can also provide more payment options for suppliers beyond paper checks, like electronic payments. These types of payments can be more secure and financially advantageous for your business given the rise of check fraud. They can also benefit your suppliers by accommodating their preferences.
Ready to Experience AP Automation Benefits for Yourself?
AP automation may sound like the wave of the future, but it can make an impact on your business in the present. If you’re ready to transform your AP workflow, click below to book a demo with one of our automation experts.
Learn more about the AP automation benefits other companies are enjoying by reading our customer success stories:
📈 AvidXchange Helps Arby’s Franchisee Scale
DRM, Inc. modernizes internal processes to manage costs and enable growth.
💻 Property Management Company Transforms AP Processes
Mansermar automates AP and cuts invoice and payment processing time by 25%.
⏱️ Orthodontic Service Organization Automates Accounts Payable
Orthodontic Partners embraces paperless AP, centralizes processes, and saves time on manual tasks.