News & Resources


Make the Most of Your AP Automation Investment to Avoid Costly Mistakes

BY: Jason Lamon | 01/26/23

The pressure to invest in accounts payable (AP) digital transformation efforts continues, and teams are eager to make a successful transition. But according to Gartner, at least 75% of all enterprise resource planning (ERP) implementations are not successful, mostly due to loose, undefined goals and roadmaps. It’s important that all stakeholders are involved from the early planning stages to understand the success criteria for implementation and the system going forward. They must also mitigate potential AP challenges.

Reach a High ROI

Modernizing your AP initiatives provides convenience for organizations and directly impacts their bottom line. Data entry combined with paper-based processes are prone to errors. Filing paper and indexing documents adds complexity, especially when it’s necessary to recall audit trails. From an automation standpoint, your ERP will only be able to offer so much out of the box. Therefore, it is critical to document the automation gains you are looking for and understand any existing functional gaps. After all, the more automation you can realize will lead to more time saved which equates to more profits.

Automation can be advantageous when capturing early payment discounts with the ability to identify and prioritize invoices. Consider that even the standard early payment terms of a 2% discount within 10 days for a payment translates into an annualized return of almost 37% on available cash.

AP automation solutions combine intelligent data capture technology, a configurable rules-based workflow engine, a document manager, and a reporting tool.

Conduct Business Walkthrough, Discovery Process

Before AP automation gains can be realized, organizations must align on system requirements, budget, and overall expectations. This involves a meeting with key internal stakeholders and your implementation partner, vendor, or consultant. The business walkthrough and discovery step will help document your current AP process, business problems during the process, ideas for change, and the desired AP outcomes.

Some examples of open-ended questions that should be asked during this step include the following:

  • What are three primary business pains you are trying to resolve with an automated invoice processing solution?
  • What ERP system is your organization using?
  • If you aren’t currently using an ERP system, would you like to take advantage of early payment discounts?
  • How many invoices do you receive each month?
  • What percentage of your invoices are purchase order (PO)- and non-PO based?
  • Does every invoice go through an approval process? If not, how are they processed?
  • Do you perform a two or three-way match? If not, please explain.

Manage Master Vendor Files

Another critical step before diving right into automation is to clean up one of the most important accounting assets: master vendor files. Although automation can help with monitoring for errors once encoded with company policies, the pre-work of streamlining vendor entries can be worthwhile long term to help avoid costly mistakes and inaccurate records post-implementation. Three simple steps to take with master vendor file clean-up are the following:

  1. Remove duplicate vendors—With duplicate or multiple vendors in your system, duplicate payments may occur. With AP automation, the solution recognizes if a vendor is paid twice but not if there are two different vendor numbers.
  2. Add missing data or fields—Double-check each vendor record for contact information.
  3. Archive outdated or inactive vendors—Keeping up to date with vendors frees up storage and allows you to access vendors’ records faster. Remove or archive any vendors you haven’t worked with in the past 12 months.

Handle Your Current (and Future) Business Processes

All AP professionals can agree that they want solutions that are configurable and flexible to their businesses and future goals that provide them with a strong sense of ownership.

For example, if managers want improved spending control and visibility, real-time dashboards enable them to view invoice statuses to help identify bottlenecks and adjust workload distribution. Or, if they are focused on improving compliance, invoice approval routing workflows are coded by the companies’ policies or rules meaning compliance issues are nonexistent. If an error occurs, AP teams can resolve it by adjusting the policy or rules in the system.

Another example where rules-based configuration becomes helpful is within procurement when processing PO and non-PO invoices. With customizable templates to speed up PO creation, teams can send the PO to the appropriate people for approval faster. Invoice automation lowers the risk of mistakes and makes it a much more manageable cycle.

Regardless of the business goal, an AP automation solution should remain flexible enough to handle all anticipated AP processes and be integrated with and complement your ERP systems.

Prepare for Change

When making the switch to an AP automation solution, you need to understand the impact it has on your organization’s culture, employees, and customers. As you prepare for transition, you should factor in stakeholder’s needs and how to address them. Their buy-in will allow for a better implementation. In fact, change management may even fast-track your implementation. When designing a change management plan, the following is recommended:

  • Establish the goals and benefits—Articulate how this change will benefit each party such as increased operational efficiencies and faster response times
  • Communicate your plan early on—First, explain to internal parties about the implementation before sending correspondence to customers. Understand what information is being transitioned and if there are critical steps that might need to be completed on either party’s end. Also, develop and share an implementation plan so they understand the schedule of key milestones or phases leading up to when it will officially go live.
  • Update stakeholders regularly—Do not overwhelm them with information but provide brief updates on progress regarding the change that will be occurring
  • Consult an expert—Rather than leaning on experts within your organization, seek an outsider who can be a consultant for you and who brings more knowledge about these types of changes based on similar situations

Without a planned change management approach, organizations will have a difficult time recovering once the solution is implemented.

Leave No Room for Error

As you prepare to start streamlining AP processes, you need to ensure your team is trained. Closely align with your IT department to devise a training program that will help educate employees on the new system. Be thoughtful in the content and consider how each user will interact with the system and what tasks they will need to know how to complete. Adequate training is crucial and can greatly impact the success of the implementation.

Additionally, make sure to conduct user-testing to see how individuals are using and navigating the new system. Testing provides the opportunity to uncover expectations and other use cases enabling organizations to avoid any mistakes and resolve issues.

Hit the Ground Running ... With a Plan

Although organizations want to reap the benefits of AP automation, it’s important to consider all the parts that make up a successful implementation plan. Not only can it hurt an organization if implementation goes awry, but it is harder to reset and resolve issues that could have been prevented.

Jason Lamon is Hyland’s Cross Industry Solution Marketing Manager, a role in which he is responsible for developing strategic positioning for the company’s core back-office solution areas, including accounting, HR, finance, legal, and more. Lamon is a 20-year tech industry veteran, where he’s served as a marketing leader, product strategist, and tech evangelist, specializing in positioning, demand generation, and sales enablement for solutions such as content management, portals, enterprise search, mobile apps, and more.