Use this blog post as a resource when making the business case for AP automation in your organization—and get ready to take your finance department to the next level!
Accounts payable automation is a hot topic in the business world. And for good reason—AP automation can save your business time and money.
If your organization is still using manual processes to manage accounts payable (AP), you’re falling behind the competition. With AP automation, you can streamline your process and reduce costs—which is why more and more organizations are making the switch.
In this blog post, we’ll show you how to make the business case for AP automation so that you can get buy-in from decision-makers and take your organization to the next level.
The first step in making the business case for anything is understanding the needs of your organization—and in this case, that means understanding what AP automation can do for you. Here are some of the key benefits of automating your AP process:
- Reduced Costs: With AP automation, you can eliminate paper invoices, manual data entry, and other time-consuming (and expensive) tasks. In fact, according to a study by Levvel Research, best-in-class organizations saw a 43% reduction in processing costs after implementing an automated solution.
- Faster Payments: When you automate your AP process, invoices are automatically routed to the proper approvals, which means payments can be made faster—without sacrificing accuracy or control. In fact, according to the same study by Levvel Research, best-in-class organizations saw a 50% reduction in days payable outstanding (DPO).
- Improved Accuracy and Visibility: With an automated solution, all of your data is stored in one central location—which makes it easier to track payments, improve forecasting, and make informed decisions about cash flow. You’ll also have visibility into every stage of the process so that you can identify areas for improvement.
But how do you make the case for AP automation to upper management? Here are three tips.
Tip #1: Know Your Numbers
The first step to making the case for any kind of business change is to know your numbers. When it comes to making the business case for AP automation, CFOs and other finance professionals need to be able to show a clear ROI. Fortunately, there are plenty of ways to do this.
In this case, you need to know how much time and money your current AP process is costing your company. This means tracking how many invoices your company processes per week/month/year, how many employees are dedicated to the AP process, and what percentage of invoices are paid late. Once you have a handle on these numbers, you can start to put together a cost-benefit analysis that will show upper management just how beneficial AP automation could be for your company.
Be sure to include all of the costs associated with AP processing, including staff time, software and hardware costs, and any other associated costs.
Show how AP automation will save time and money. CFOs are always looking for ways to improve efficiency and cut costs, so this is a key selling point.Demonstrate how AP automation can improve accuracy and compliance. This is especially important in industries with strict regulations, such as healthcare or finance .Finally, make sure to show how AP automation will free up staff time for more strategic tasks. This is often the most compelling argument for AP automation, as it can have a tremendous impact on the bottom line.
Tip #2: Do Your Research
After you’ve gathered all of the necessary data, it’s time to do your research.
This means finding out what kind of AP automation solutions are available and seeing how other companies in your industry have benefited from automation. This research will give you the information you need to put together a solid proposal for AP automation that upper management will be able to get behind.
Include a detailed analysis of the current AP process, highlighting inefficiencies and areas where automation could provide significant improvements.
Be sure to address any potential concerns about AP automation, such as initial costs or change management issues. CFOs are numbers people, so hard data in the form of real-world examples will go a long way in making the case for AP automation.
Tip #3: Focus on the Benefits
Make sure to highlight the potential benefits of AP automation, including increased efficiency, improved accuracy, and strengthened controls.
When you’re putting together your proposal, it’s important to remember that upper management is ultimately looking out for the bottom line. This means that they’re going to be most interested in the benefits that AP automation can bring to the bottom line— like saving time and money. So, make sure that your proposal highlights these benefits front and center. If you can show upper management how AP automation will help improve your company’s bottom line, they’re more likely to sign off on the project.
Conclusion
If you want to get upper management on board with AP automation, follow these three tips: know your numbers, do your research, and focus on the benefits. By taking these steps, you’ll be able to put together a strong proposal for AP automation that will help improve your company’s bottom line—and that’s something any good business person can get behind.
By following these tips, CFOs and other finance professionals can develop a strong business case for AP automation that will help them get the approval and funding they need to implement a solution, and we are happy to help. Contact us today.
