Travel for the holidays this year is expected to top 2020 by more than 37%, with 63% of adults planning trips. As travel restrictions begin to lift and more Americans venture out to conferences, business trips, and vacations, the need for a fully digitized Accounts Payable (AP) process is more important than ever, enabling untethered employees to seamlessly process and pay invoices in the cloud. For many AP departments, the pain of handling manual payment activities during the pandemic has been indelibly etched in their minds – when AP staff had to go into the office during lockdown to pick up check stock, physically route checks to the CFO for signing, and then mail payments out to suppliers. While we hope we never have to go back to the quarantine days, we are now in a new normal where cloud-based AP automation solutions are critical to sustaining business operations in these work conditions.
On top of increased travel, there are other trends that are driving the need for digitized AP and payments. Our 2021 State of the AP Report shows that hybrid work has become a permanent reality for most AP departments, with some combination of on-site and off-site activity. While 85% of finance teams worked in the office full time pre-pandemic, at the height of the quarantine, the ratio of in-house to off-site was largely reversed, with only 22% coming into the workplace. Now, with 62% working completely remotely or in a hybrid situation, the trend of splitting time between the office and home is expected to be with us for the foreseeable future. Our survey also found that hybrid work is expected to impact over half the workers (54%) going forward.
As companies try to address these issues and eliminate the need for time-consuming, manual work, the popularity of AP Automation solutions has been rising. With cloud-based services, invoice approvals and payment authorizations can happen at all hours of the day, no matter where people are located, reducing delays that can cause processing backlogs. Once authorization is received, payment processing is handled automatically, eliminating the need for AP departments to manually cut checks. In addition to speeding up operations and enabling AP staff and approvers to work remotely, as needed, these solutions offer added value to AP departments, including visibility across the entire invoice-to-payment process, reduced costs, and time to focus on other activities.
Digitizing Invoice to Payment
Many AP departments are taking automation further by digitizing the entire AP workflow, from invoice capture and coding, through invoice approval, to payment authorization and execution. Now all parts of the invoice management process, including invoice approvals, can also be handled remotely. By removing the upfront manual invoice processing work, companies will not only accommodate AP staff, and invoice approvers who are on the go or working remotely, but also save additional time and money, while gaining visibility.
Benefits of Automizing the AP Process for Suppliers
There’s no question that when AP staff, invoice approvers, and payment authorizers are out of the office – for travel or remote work – manual processes are held up, causing invoice and payment processing delays. This slows down payments to suppliers, who are depending on timely payments to maintain healthy cash flow. Ensuring on-time payments and improving the supplier experience is particularly critical right now when companies need to access parts and goods in the midst of an industry-wide supply chain disruption.
Because cloud-based AP automation solutions and managed payment services enable AP departments to gain efficiencies, reduce process bottlenecks, and speed up payments to suppliers, they help companies to overcome these issues to maintain valued strong supplier relationships.
In addition, managed services make the entire payment process easy for companies since providers handle the heavy lifting of onboarding suppliers, managing supplier payment details, and executing the payments. All companies need to do is provide supplier contact info and advise providers on how they would like their suppliers to be approached. The service providers also have a dedicated team to handle any inquiries so suppliers can get quick responses to their questions, including payment status. Some providers are also offering vendor portals, where suppliers can check on their payments, even if they’re traveling or working remotely – regardless of where they are, the time of day, or the time zone they are in.
It used to be that if an invoice approver or payment authorizer was out of the office, the AP workflow would come to a standstill. Time was wasted and payments were delayed, straining supplier relationships. Thanks to cloud-based AP automation and payment services, that’s no longer the case. And that’s a very good thing in today’s mobile business environment, where people are increasingly untethered from the workplace, and free to travel for business or pleasure, or to work remotely as needed. Cloud-based solutions are critical in helping AP departments keep the workflow moving and operations running smoothly in this new normal environment.