The Evolution of Accounts Payable: Where We Were, and Where We Are
Very few areas of business have undergone as drastic a transformation in the past several decades as accounts payable. Not only have the invoice and communication processes of AP changed, but also its fundamental purpose within most organizations.
Just in the past 30 or so years, accounts payable has evolved from a paper-based, back-office process into a digital process that affects your whole company. In the modern business world, optimizing accounts payable is essential to smooth business operations.
In today’s article, let’s take a look at the evolution of accounts payable. We’ll cover the history of accounting and early automation, as well as how AP departments function in the present. Then we’ll look ahead to how accounts payable automation solutions may continue to evolve in the future.
The History of Accounts Payable
Back in the 1980s, companies took care of accounts payable exclusively on paper. This meant the department printed out and stored all invoices and communications as physical, paper files. Also, employees had to hand-deliver documents within the office.
As soon as business management software began to take hold in the 1990s, companies started to think of ways to re-engineer all of their business processes to be more efficient and centralized. This lowered costs and improved control. Most organizations moved accounts payable to a central location within the corporate office.
In the new millennium, accounts payable began to be integrated into a new “shared services” model of business. It was no longer a separate entity. Accounts payable now became intimately involved in other processes like procurement and disbursement.
Where Accounts Payable Is Now
Automation software has made the new “shared services” model possible and now it enables the globalization of virtually all business processes. With accounts payable automation solutions, a new global standard is being developed, aiding in procurement and disbursement across oceans and continents.
Most enterprise companies already have accounts payable automation in one form or another. However, not all are happy with the functionality of their accounting automation. Most automation in modern companies is very basic and highly limited. Whoever set up this automation usually built it around the organization’s ERPs. Problem is, ERPs can’t handle AP automation, at least not efficiently.
Further complicating things, most of this automation was developed years ago. It’s also costly to maintain and difficult to support, especially if there has been turnover in the IT department since the system was first automated. If you’re working in one of the many companies using a system of this sort, you know how frustrating it can be.
There is hope, though. Modern business process automation software is transforming how automation works in accounts payable and other departments. It’s much more streamlined, customizable, and easy to work with. In many cases, it’s also cloud-based. Moving software to the cloud takes the burden off your IT team, lowers costs, and speeds up implementation. Plus, the software integrates seamlessly with existing ERPs. Click here to learn more about what today’s AP software can do.
Looking To The Future of Accounts Payable Automation Solutions
Nobody expects the evolution of accounts payable to stop anytime soon. Accounts payable executives have the unique ability to mold and craft their business processes, and accounts payable automation solutions puts all the needed tools in their hands.
Heading into the future, it’s a safe bet to predict that accounts payable is going to become more digital, more profitable, and more strategic. Not only will there be further technological advances, but there will also be changes in how company executives use AP automation to improve the company. This is all thanks to continuing advances in accounts payable automation solutions.
NextProcess is at the forefront of developing AP automation software that can revolutionize your business processes. Our newest advances include utilizing Big Data, Machine Learning, and ICR (Intelligent Character Recognition). These advances put our software (and therefore our customers) at the cutting edge of advances in accounts payable automation solutions. We also handle upgrades to the system for you so you never have to worry about your software falling behind the times.
Are you ready to implement modern accounts payable automation and get your company ready for the future? Contact NextProcess today and see how we can make accounts payable easy and automatic for your business.