ARTICLE
Accounts Payable Automation in SAP Environments
3 Questions for an Industry Analyst
Mark Brousseau
Mark Brousseau, editor of special projects for the Institute
of Finance & Management, discusses how accounts
payable automation addresses the most pressing
business challenges SAP users face.
Q: Which trends in finance are most
impacting SAP accounts payable
environments today?
A: Three trends are fundamentally reshaping accounts payable processes
across all businesses:
#1: Cloud Deployment
The first trend is that more businesses are moving invoice processing to the
cloud. Businesses are embracing cloud computing as a way to automate
their operations without the up-front capital expense, in-house maintenance,
software and hardware requirements, or risk of traditional on premise
software. Implementing a cloud-based solution also enables businesses to
extend the value of their ERP investments more quickly than in the past.
Cloud-based accounts payable solutions deliver the same features and
functionality of on premise software, and can be customized to a users
needs. For instance, cloud-based solutions provide users with the ability
to perform payables functions such as invoice scanning, data capture,
validation and approval. Cloud-based invoice processing solutions also
address the challenge of remote work. And these cloud-based solutions can
be integrated with existing on premise ERP solutions, such as those from
SAP, creating a hybrid operations environment. The emergence of cloud-
based invoice processing solutions provides another deployment option for
mid-sized users of SAP ERP platforms. It is for this reason that one-third of
businesses will have a cloud-based invoice processing solution within two
years, IFO says.
#2: Visibility into the Business
The second trend is that businesses are automating accounts payable
processes to facilitate real-time decision-making. Todays increasingly
competitive global business environment requires businesses to make
strategic and tactical decisions faster than ever. This dynamic requires
more precision and efficiency in how decision-makers access and manage
financial information. In fact:
40 percent of businesses surveyed by Ardent Partners
said that improving accounts payable reporting and
analytics is their top priority.
By tightly integrating an automated invoice processing solution with an ERP
platform, decision-makers achieve a 360-degree view of their operational
and financial data, including:
Operational metrics
Aggregated data for cash forecasting and working capital management
Corporate spending and compliance with supplier contracts
Budget variance analysis and expense analysis by vendor
The enhanced visibility that results from the integration of an automated
accounts payable platform with SAP helps businesses streamline invoice
processing through the automatic validation of invoices against ERP data,
faster resolution of exceptions, and streamlined training of front-line users.
VISIT US ONLINE AT WWW. TOPIMAGESYSTEMS.COM
Enhanced visibility also helps businesses control Cash Conversion Cycles, Q: What is the most important piece of advice
Days Payables Outstanding and Days Sales Outstanding, more easily
for accounts payable leaders who use SAP?
aggregate spend calculations, more quickly identify budget variances or
maverick spending, and gain leverage for contract negotiations.
A: Keep the strategic benefits of accounts payable technology in mind when
developing a business case for automation. Accounts payable leaders are
#3: Intelligent Data Capture
well aware that accounts payable solutions such as intelligent data capture
The third trend is that more accounts payable departments are deploying
deliver tremendous tactical benefits, particularly in terms of reducing costs
intelligent data capture solutions to automate the import, extraction,
(60 percent or more!), but technologies such as intelligent data capture
validation, routing, and archival of data from invoices and other accounts
also deliver huge strategic benefits across the enterprise, including: fewer
payable documents. This technology should not be confused with basic
errors, decreased warehouse charges, improved Days Payable Outstanding
document scanning. Intelligent data capture solutions import and classify
(DPO), better cash position, reduced borrowing, improved supplier relations,
paper and electronic documents from any delivery stream (e.g. mail, fax,
increased margins, and higher earnings per share. The real-time visibility
email), extract header and line-item data based on preconfigured business
provided by intelligent data capture, for example, enables businesses to
rules, validate the data, match and link all documents related to a specific
manage their working capital with greater accuracy and control.
transaction, and seamlessly post approved invoices to SAP or any ERP
or general ledger system. Invoices that require approval are automatically
Automation also provides the visibility businesses need to capture more
routed based on defined rules. These capabilities enable accounts payable
discounts, and maximize returns. Additionally, the technology helps ensure
departments that use SAP to reduce transaction costs, accelerate the
budget and contract compliance by allowing businesses to set rules for
delivery of usable data to SAP, reduce invoice approval cycle times, and
price and quantity tolerances during invoice processing. And automation
decrease errors.
ensures that businesses have ready access to the accurate and complete
information they need for planning, forecasting, and decision-making. These
Not surprisingly, 27 percent of businesses plan to
benefits can have a major impact on a companys bottom line:
deploy automated data capture and workflow for
invoice approval, IOFM reports.
Studies show that every day of DPO extension yields
more than $25 million in cash for a Fortune 500
Q: What impact are these trends having on company; every billion dollars of spend yields over
SAP users? $400,000 in discounts per month; and more than
50 percent of supplier financing yields more than 30
A: The trends in accounts payable automation will have big ramifications percent annualized rate of return.
in the payback businesses receive from their ERP investments. New
technologies, changing business needs, and tight capital budgets are So dont sell the strategic benefits of accounts payable automation short!
bringing rise to what Gartner calls the postmodern ERP: an ERP strategy
that integrates existing investments in an ERP with third-party operational
business capabilities such as accounts payable automation. This approach
offers greater agility and flexibility to satisfy business needs compared to
monolithic ERP approaches that depend heavily on expensive customization.
Many businesses already have migrated to an environment where third-party
applications work in concert with an existing ERP platform, such as SAP. About TIS
Integrating an invoice processing solutionsuch as a cloud-based solution
Top Image Systems (TIS) helps businesses compete in the digital economy, where
that automates data capture, workflow processing, and cloud archival the customer journey begins, progresses and ends in an entirely digital environment. In
finance, this means transforming paper-based, manual processes to end-to-end automated
with an SAP ERP platform complements the ERP to dramatically increase
processes that work the way you doon premise, in the cloud and via mobileinside of
its business benefit. It also reduces the time, cost, risk, and complexity SAP. 2016. Top Image Systems.All rights reserved.
required for deploying applications. As a result, more accounts payable
departments will integrate third-party applications with their SAP platform.

VISIT US ONLINE AT WWW. TOPIMAGESYSTEMS.COM