Paper Is Out, Electronic Is In: Tracking The Rise of Paperless
Whether it’s on a weekly, bi-weekly or monthly basis, AP personnel have been tasked with ensuring all incoming and outgoing invoices are processed quickly, efficiently and accurately. Historically, the menial labor aspect of this process has been unavoidable: Invoices are issued on paper, mailed or faxed, data is entered and tabulated by hand, and following payment, the invoice is then filed.
We don’t have to belabor how operationally exhausting this process is, but for decades it was very much the norm. But things have changed: Thanks in part to AP automation opportunities, the paperless wave is taking hold, not just in the accounting and invoice space, but also in actually saving space when storage availability is scarce. Here’s a brief history on how the paperless invoicing trend got its start and why it doesn’t look like it will be ending anytime soon:
‘The Office of the Future’
Though it’s difficult to pinpoint the precise launching point for what would become the paperless era, the movement gained a foothold in 1975, in an article titled “The Office of the Future” in the publication BusinessWeek.
George Pake, who at the time was the point person for the Xerox Corporation Research Center, told the magazine he had full confidence the rise of automation would turn traditional business on its head.
“There is absolutely no question that there will be a revolution in the office over the next 20 years,” Pake predicted. “What we are doing will change the office like the jet plane revolutionized travel and the way that TV has altered family life.”
By all accounts, this prediction has come true: Offices that were previously tethered to hard-copy invoicing, as well as other paper-based operations and processes, have seen the steady adoption of technology that renders paper unnecessary. While obviously this prediction had a utopian ring to it, the truth is that the underlying driver of technological adoption has always been about maximizing efficiency and profitability for businesses. Ink and paper are not unsubstantial line items in operating budgets for many businesses, so cutting these out can lead to serious savings.
“Companies are analyzing all their workflow processes to see if paperless makes sense.”
Companies around the world have gone down this paperless path: Around 10 percent of companies in 2014 made concerted efforts to go as paperless as possible, examining every form of documentation used, according to survey data compiled by the Association for Information and Image Management (AIIM). By 2015, though, the share jumped to 16 percent and all data suggests this will continue to climb at times goes by.
Reducing the Footprint
The same logic holds true for minimizing the need for a physical archive of filed invoices, with filing cabinets that can end up occupying an uncomfortable amount of an office’s total footprint. As Christina Jones, founder of the Equine Business Association, said to the Telegraph, this helps mitigate the limitations of a smaller office – or even an entirely remote workforce.
“We’ve transitioned to a 100 percent virtual team, so having paperwork in office filing cabinets was no longer accessible,” Jones told the Telegraph. “I also wanted more freedom to work from different locations, and to reduce admin costs, particularly with accounts and bookkeeping. ”
Rummaging through filing cabinets slows work processes down. Indeed, document searches can account for nearly a third of workers’ time, according to a study conducted by the ILM Corporation. What’s more, the typical employee devotes more time to searching for documents than they do to reading them, averaging 60 minutes versus 20 minutes, respectively.
Digital Invoices Saving Money, Time
Business AP has seen the most dramatic benefit from this technological shift. The ability to issue, process, authorize and archive invoices digitally has a much more direct impact on a company’s bottom line than simply reducing the paper cost line items in budgets. Simply put: It helps companies pay vendors faster, creating a true operating budget and removing the burden of delayed payments. This may explain why an estimated 40 percent of companies deliver at least 50 percent of their invoices in a digital format, according to AIIM.
Jim Secord, CEO for an accounting startup based in Canada, told Inc. magazine that AP automation makes everything easier and faster, from start to finish. But this isn’t just a benefit for the accounts receivable department: The reduction of the paper trail not only expedites payments but creates a true operating budget, allowing AP to schedule payments in a smarter, more sophisticated way, making better use of constrained resources. Add to this digital tagging making pulling completed invoices from the archives a far faster process, and you have a segnificant improvement to paper-based AP.
For companies that haven’t jumped aboard the AP automation bandwagon, leaving paper in the rearview mirror, there’s no time like today to make the switch. A sophisticated automated AP solution like MineralTree has the tools to make the transition smooth, allowing for greater efficiency and visibility into payments and invoicing – all without having to search through stacks of paper.
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