If you don’t take the necessary planning steps before implementing an automated P2P solution, all you may end up doing is paying for the privilege of making the same mistakes faster.
In today’s global and increasingly competitive economy, businesses, large and small, are searching for ways to do more with less. This is true throughout the enterprise, including the entire procure-to-pay (P2P) continuum. The first places to begin the “do more with less” effort are in department policies, processes, and procedures. Finding efficiencies in workflow and the invoice approval process will definitely streamline this historically problematic function, gaining efficiencies in both processing time and cash management.
In order to be successful in this endeavor, many organizations are turning to technology and financial process automation. Companies that rely on paper-based manual processes will continue to be plagued by errors, overstaffed departments, and a lack of full visibility into cash flow and working capital. Automation, by its very nature, takes something complex and looks to simplify operations while providing a mechanism for growth. What it also does is enable companies to measure performance and have access to real-time visibility into all phases of the P2P process. Thus error rates will be reduced; approval roadblocks can be identified and addressed; and supplier relationships can be enhanced due to predictable payment schedule.
Think of automation as a tool. You need the right tool for the right job.
You wouldn’t use a hammer for the same purpose as a paintbrush. Likewise, not every automation solution will serve your specific needs. Some companies look for plug and play solutions that are more generic in nature, but every company has its own processes. Therefore, it is imperative that you understand and test those processes before you look to automate them. Failure to do so may simply result in making mistakes at a faster rate.
Unfortunately, many companies don’t know what they don’t know. They may assume that simply implementing an automation solution without doing the proper groundwork will solve their problems. Enterprises must perform due diligence at the front end of their process automation, choosing a solution provider with the expertise specific to their needs. And, just as importantly, companies need to hold themselves back from being overly ambitious. Tackling every issue at once can end up being so disruptive that management and employees essentially give up and go back to depending on those bad processes to avoid total disruption to their operations.
Take these 3 steps to avoid automating bad processes.
Once you’ve made the decision to automate your transaction processes, you need to take these important steps.
- Define your goals – Simply wanting to do more with less may be the overall goal, but you need to be specific as to where you want to be once a solution has been implemented and training completed. Give yourself a time period to measure success and provide a feedback loop in the process so lessons learned flow back into the overall design. Defining where you want to be in as much detail as possible will galvanize the vision and help define the foundation upon which your new solution will ultimately stand.
- Map your processes – How are you currently handling your invoicing and payables processing? Can you describe this in detail if put to the test? A good exercise will be to identify each step in your payables and receivables processes, noting where roadblocks occur. You may be surprised when you do this how many steps there are and what is really creating unnecessary complexity and stopgaps. By removing these pitfalls in the planning stage you can save time and money when it comes time to implement (especially if you are paying for someone to do it for you).
- Select the right partner – Too often, companies look for outside expertise to “save them from themselves.” There are many organizations out there that will gladly help you do just that and charge you every step of the way. Most professionals have experienced a bad implementation at one time or another and can remember the pain involved. Given the impact to an organization that a disruption to your P2P processes can have, it is vitally important that any partner you choose has the experience necessary to do the job. This is achieved through strong requirement definition, competitive bidding, and strong contract/project management through the implementation. By selecting a partner that has proven success with exceeding the goals that you define, you save considerable time and money through the project lifecycle and beyond.
If you don’t follow these three essential steps before you implement an automated solution, then you’re just going to make mistakes at a faster rate and, what’s worse, you’ll have paid for the privilege.
See how finding the right financial process automation solutions can eliminate the inefficiencies, silos, and friction that plague B2B commerce.