By Lloyd Parata

In the current economy, visibility and control over the processes that drive a company’s cash, accounts, net performance and working capital have never been more critical. As a result, companies are taking the opportunity now to improve their procurement to payment process by transforming accounts payable (A/P). Those that are successful will make a significant contribution to cash flow and the bottom line.

While there is a wide range of organizational challenges linked to A/P productivity, they can be categorized into three key priority areas: information management, automation, and business optimization. To address their top of mind issues, companies are focusing on these areas:

Volume and paper overload presents an information management challenge. Or-ganizations struggle to find efficient ways to manage, store, and access their high volume of invoices, purchase orders and associated documents, and find their current manual handling to be error prone and difficult to track.

Inefficient and complex environments present automation challenges. A/P pro-cesses are complex, dynamic, and intertwined throughout an organization.

Lack of control and visibility presents optimization challenges. Managers cannot get the reports on payable status and process performance that they need to effectively manage their departments and to manage cash strategically. And, providing accurate data for financial statements, and meeting the disclosure and auditing mandates for regulations is impossible without process transparency and robust records manage-ment.

ProcessImprovements

Responding to the challenges and opportunities that A/P presents, best-in-class companies are focusing their process change strategies to improve in three areas:
Assure Financial Transparency. Capture invoices upon arrival so there is visibility into financial liability. Ensure strict compliance requirements are met with KPI (Key Performance Indicators) metric dashboards and reporting audit trails.
Streamline Processing and Approvals. Get paper off the floor and then automate approvals to streamline the process in a distributed environment. Automation brings consistency to multiple systems and processes that may exist in a large organization by line of business, removing complexity and improving efficiency and overall visibility.

Enable Collaborative Exception Processing. Focus on support for collaborative exception handling that involves efficient people, process and document interactions.
PeopleFocus

Current economic conditions have raised the importance of cash flow strategies like A/P transformation to the board level. As a result, many enterprises have both a priority and a solid opportunity to improve A/P and the related processes; however, they are not necessarily fully equipped to do so in a cost-effective timely manner.
This is where a new approach to process and document management — Persona-based BPM — can be effective. Persona-based BPM puts the focus first on the way work gets done and on empowering all three types of people critical to the success of BPM systems: Builders, the people who build them; Participants, the people who use them; and Managers, the people who manage them. By putting people first, Persona-based BPM can cut deployment time by 50% and achieve a 40% increase in productivity compared to other BPM solutions.

With BPM, companies can automate their paper-based, labor-intensive A/P processes. However, this “model-driven” approach is not sufficient, because it lets the model dic-tate how work gets done and treats users as an afterthought. Improving a process with speed alone can only help make the same mistakes faster; and forcing an unfamiliar, non-intuitive user interface on staff can hurt productivity more than it helps. Persona-based BPM solutions deliver both an improved process flow and an optimized user experience, delivering significant contribution to the bottom line.

FirstAdopters: Already SeeingResults

Market leading companies like Ciba Vision and Lowe’s use Persona-based BPM to improve accounts payable, eliminating errors that cause delays and unnecessary adjustments, such as goods being received for which no invoice has been generated, or vice versa. These companies avoid situations where the processor needs to track down the information, delaying the process and possibly missing time sensitive vendor discount terms.

As a result, these companies are experiencing key economic benefits, including increased “straight-through processing,” so that processor staff and approvers can focus on more strategic value-added tasks and improved prioritization of payables as well as tracking of organizational performance. Process steps are automated and all related documentation is consolidated, A/P staff can reduce processing time while simultaneously increasing volume. This can represent hundreds of thousands of dollars in discounts that might otherwise have been wasted.

Perhaps now is the time for you to look at transforming your accounts payable. It could really “pay off” for the business.

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