The importance and benefits of process automation. Currently, many companies still use manual processes, which, in some cases, is counterproductive and generates several difficulties. They are generally slower processes, documents tend to get lost, processes are not very efficient and there is not much control.
In the case of a company’s accounting, the Accounts Payable process in the financial department is the perfect example where, in addition, great changes and improvements in efficiency can be achieved through automation, according to Yooz experts.
Why process automation is important?
First of all, the importance of automating accounting processes in the company is based on the fact that it allows implementing Digital Transformation in the department and having new technologies to facilitate and optimize the team’s time.
In addition, the accounting department continuously reports several problems compared to manual processes: high costs of processing each document, lack of visibility, loss of documents, errors in payment, lack of traceability, document forgery, lack of control, among others.
Let’s look at specific figures:
The cost of manual processing of a paper invoice varies between $9.4 and $20.8 and the cost of archiving is estimated at $3.25. And any error is very expensive! A misfiled or lost invoice ends up costing the company $100 to search for it and an even higher cost if it has to be reproduced, according to the report “The state of ePayables 2020“. In addition, there are other types of indirect costs, more difficult to measure but which we know are present and which further complicate this process.
After the confinement we went through at the beginning of 2020, companies were faced with the need to move forward in an environment of greater uncertainty and with little information available about their activity. To regain control, the focus was placed on guaranteeing the future of the company and being prepared and able to face any unforeseen event. This shows that manual processes are outdated and do not adapt to the needs of visibility, efficiency, and agility, among others, that are present today for the accounting department.
It is time to adopt automation technology in companies and thus ensure better service, redirect efforts to more important tasks, and achieve a competitive advantage.,
But what are the benefits of an automated Accounts Payable process?
- More productivity in the company: Automating Accounts Payable allows lowering the fixed costs of the process and obtaining productivity gains quickly. Automation saves time on operational and tedious tasks such as document entry, archiving, searching, etc. In this way, the whole process is accelerated and becomes more productive.
- Visibility to negotiate: In this uncertain environment in which we live, the company needs to know all the time its financial situation and have access to real-time information of all its processes. Accounts Payable automation provides this constant, up-to-the-minute visibility. In this way, instant access to data allows better strategic decisions to be made because the information is available in real-time.
- 24/7 availability: Having an automated process in your company allows you to continue the activity remotely without losing efficiency and productivity. We can access quality information and data at all times from anywhere. Confinement was the perfect example to demonstrate how important automation is; those who had this type of system were able to continue working from home.
- More security: All companies, but especially smaller ones, need to manage their internal processes well to increase security against unforeseen events. Accounts Payable automation provides information and prevents document loss and reduces data entry errors, among others, when entering and paying invoices.
- Fewer delays and litigation: Automated Accounts Payable makes it easier to control suppliers and build quality relationships with them. This way, the team does not spend hours trying to troubleshoot payment issues or locate missing documents, etc. It is estimated that 41% of an accountant’s time is spent handling vendor calls, delaying payment in 31% of cases. With Accounts Payable automation, the risks of late payments and other errors can be drastically reduced.
- Better quality of the company’s management: Thanks to automation, it is possible to access relevant information (performance indicators) that allows for better management and control of the entire process, as well as of human resources, all in real-time. In addition, all kinds of information and statistical data on the process are obtained, giving a competitive advantage over the competition and allowing more time to be devoted to higher value-added tasks, better customer service, and concentration on the product offering.
- Putting an end to fraud: Among all the risks a company faces, document fraud is among the most frequent. In 2018, according to the firm Euler Hermes, 70% of companies were victims of an attempt at document fraud; and these types of problems are also costly. The automation of Accounts Payable allows for higher quality control of the entire process through the software and to detect any anomalies in the documents. In this way, it becomes the CFO’s weapon to ensure his operation to reduce document fraud attempts.
