Do You Have Succession Plans in the AP Department?
If the head of your accounts payable department moved on to a new position tomorrow, could anyone step in to fill their job? What if a couple of AP employees transferred to another position within your company, retired, or went to work with a different company?
Having a solid plan to replace financial professionals who retire or move on to a new career opportunity is just common sense. With baby boomers retiring and many younger workers planning to change jobs multiple times during their careers, there’s never been a greater need for a good succession plan. Plus, recent years have seen staffing shortages and high turnover rates even for senior positions like CFOs.
Keeping the finance department, including accounts payable, running smoothly is essential for overall business success. Even if you’re using automation software, you still need good people working in AP to keep things on track and help AP fulfill its full potential to support the company.
Planning for Employee Turnover
In the rapidly changing modern workplace, job hopping is the new norm. The average worker spends only 4.4 years at any given job, according to 2012 data from the Bureau of Labor Statistics. Younger workers from the Millennial generation move through jobs even more quickly, with 91% expecting to stay at a job for less than 3 years.
Even at the management and C-Suite level, turnover is becoming far more common than it once was. Forbes reported that the turmoil of 2020 played a big role in this, prompting some CFOs to retire, rethink their priorities, or leave the position for various reasons. Many companies identify succession challenges as a high-risk factor in their businesses, but 44% of those surveyed approach succession on an as-needed basis rather than developing a plan.
Rapid turnover in the workforce—at any level—can have quite an effect on your AP team. It takes time to train new people and familiarize them with your system. On top of that, there’s all the time that goes into interviewing applicants for an available job. Without a plan for succession, your AP department can fall behind on critical tasks while hiring and training new employees.
What Is a Succession Plan?
Creating a succession plan involves deliberately planning for how new people will move into important positions as those positions open up. It’s a long-term business strategy that can take several different forms.
Your company might want to have more than one succession plan in place. One could describe a plan for emergency situations, like filling an unexpected upper-level vacancy. Another could describe how you’ll cultivate internal talent to move up within the company as positions open. Another might focus on recruiting, hiring, and training new talent. Some plans focus on replacing key leadership positions while others are broader.
Exactly what these succession plans look like will depend on your company. Often, succession planning involves cultivating talent internally. In many cases, it makes a lot more sense to focus on supporting employees you already have as they move up in the organization than to try and train outside hires for those critical roles.
An AP Succession Plan
Even if your company attracts long-term employees, it’s a good idea to have a solid succession plan for when employees retire or choose to leave. Many members of senior management are getting ready to retire after 20 to 25 years in the AP profession, and you’ll need someone to fill those positions. Better to have a plan in place than be caught in a hiring crisis.
Ideally, you’ll identify possible successors and have them in place throughout your organization, ready to step into a new role as others in your AP department move on. However, maintaining a job-ready pool of employees can be hard when so many new employees see job hopping as part and parcel of their career path.
One way to help keep employees from moving on is to deliberately invest in creating a good company culture. Being open about possibilities for advancement within the AP department can also motivate employees to stay. In addition, making tools available to help make employees’ lives easier will help avoid overwork and burnout.
The Role of Automated Accounts Payable
One of the best ways to support a succession plan comes from what might be an unexpected source. People often think of automation as something that replaces employees, but Business Process Automation actually makes people’s jobs easier. It also frees them up from tedious tasks and makes it easier to onboard new employees.
Switching to automatic accounts payable software keeps your AP policy and procedures documented in an automation workflow tool that is easy to use, even if members of your AP department retire or leave the organization. NextProcess’s Automatic AP Software is tailored to your company’s individual process. It immediately reduces costs, provides oversight for everyday invoicing, and streamlines your accounts payable system.
By adding Accounts Payable automation software to your strategic management tools for succession planning, your business will be prepared to smoothly transition during planned or unplanned departmental turnover. To learn more or schedule a free software demo, click here.