Solving the Payables Paper Problem in 2022
Paper is fast losing its status as a key part of the payables process. From the sudden spread of email years ago to the modern surge of green initiatives, everyone’s been talking about new ways to use less paper and take advantage of the digital tools available.
The conversation about digitization became even more urgent in 2020 when the Covid-19 pandemic forced businesses to move many of their processes online. Though many are back to working in person now, the pandemic highlighted the importance of a flexible and remotely accessible system for managing core business processes.
Digitization tools like optical character recognition (OCR), data capture technology, and business process automation (BPA) have been huge topics for years now. But how many businesses are using these tools? How successful has the conversion from paper been so far? And what does all that mean for your business in 2022?
Who’s Going Digital?
Despite accessible technology, there are a lot of businesses that aren’t taking advantage of digital back-office processes the way they should. Companies are still struggling to manage incoming paper invoices, maintain paper-based files, and send out paper checks.
In a survey of AP professionals, one company found that nearly 75% of respondents said the most common way they receive invoices is through the postal system. It’s estimated that half of all invoices are being received on paper—either through the mail or interoffice communications. With all this paper, processing delays can happen very easily. And despite companies being slow to digitize, this same survey found that AP departments that are using digital solutions are very happy with them. The people processing invoices every day want to go digital. It’s just hard to change the status quo.
There’s a tendency to continue manual processes long past their necessity. For example, 85% of respondents to a survey conducted by the Association for Information and Image Management (AIIM) thinks business should offer e-signature options. However, this survey also found that 62% of companies still require signatures for approval on paper documents like invoices or purchase orders. There’s often a disconnect between what employees know will work best and what companies require.
Why Do You Need to Go Digital?
In 2022, we all rely heavily on technology. A lot of us have a hard time remembering how we did everything before we had smartphones and other modern improvements. Laptops have gone from luxuries to standard-issue and are already on their way out as tablets dominate the market. Company phones are everywhere. It’s even become common to give employees a stipend for their personal phone so they can be reached for work anytime. In addition, remote employment becomes more and more common every year, particularly in the aftermath of 2020.
Companies need flexibility to adapt to all these changes in technology and make it so that employees can work remotely if necessary. This means that companies need to be willing to change in a way that takes advantage of the digital options available. In an increasingly global and digital workforce, relying on paper-based processes is guaranteed to hold you back.
Another issue that companies face is fluctuating invoice volumes. Seasonal increases in production mean huge jumps for invoice processing. The end of the year is another time that most companies must invest extra time and resources to finish payables processing. While digitizing won’t change the number of invoices your company receives during busy times of the year, it can help. Automation-supported digital accounts payable processing makes it much easier to adapt to the influx of invoices.
What Happens When You Go Digital?
Digitizing your accounts payable process is the answer to several issues companies face in the modern world. BPA software like we offer here at NextProcess lets you customize the system to your company’s needs. It also enables remote access for employees who can’t be in the office.
Once the whole process becomes digital, there’s no need to manage paper files. Accounts payable processing becomes streamlined into a clean workflow that doesn’t have to rely on people manually inputting data from paper files. NextProcess’s OCR and data indexing technology ensure that both digital and paper invoices enter the system accurately for fast and reliable processing.
In addition to the flexibility and accuracy offered by digitization, there are also significant savings involved. We’ve found that fully automated companies save an average of $14.93 per invoice they process compared to organizations that manually process invoices.
Using paper is critically expensive. Just handling the manual processing of invoices and other sensitive finance documents is a cumbersome task that drains company resources instead of boosting them. Using a scanning service, or even just a digital document management system, can have immediate improvements for processing in the most paper-heavy departments. In many organizations, this includes expense reporting and purchasing as well as accounts payable.
How Can You Bring the Team Together?
BPA software also brings about improvements in interoffice and interdepartmental coordination. Transparency in expenses and readily accessible documentation are beneficial for all departments. Giving financial departments the tools they need to forecast and budget appropriately is a way to save your company a lot of pain and trouble down the road.
Having a good system in place ahead of time means that everyone can work together to meet the needs of the group, instead of focusing solely on one department at a time. Your company has to be able to act as a single unit when moving forward into 2022. Adding standardization and automated processing to the AP department gives you better control and flexibility while also allowing for collaboration with others.
Digitization and the elimination of paper aren’t just important options in improving back-office processes. They are absolutely critical to continue to flourish—and, at some point, survive—in the increasingly competitive economy. It’s time to start asking the tough questions about current processes and find a software provider to bring your business forward. If you’d like to see NextProcess software in action, contact us today to request a free demo. We’ll also be happy to answer any questions you have about how AP software can help your company solve the paper problem.