In the A/P Automation world, "Business is Booming". There had already been a shift of more and more organizations taking their Accounts Payable processes electronic (as well as reaping the benefits from many of the other features listed below) but as more and more organizations have gone remote or downsized this year due to COVID-19, the usage and implementations of A/P Automation software have simply sky-rocketed. The good news for companies that have moved to A/P Software is that there is almost immediate actual cost-savings and these implementations are typically a win-win for everyone involved.
Let's look into what features you can expect from A/P Automate in 2021 and beyond...
Core Functionality ⛭
Optical Character Recognition
A good OCR engine is crucial for A/P Automation. In a perfect world, an invoice is received electronically, all fields are read (amount, date, vendor, etc.) & the invoice can be submitted for approval with little to no effort. Be sure to discuss the OCR success rate with the vendor when evaluating a solution as companies have different methodologies and technical approaches to getting OCR setup.
OCR Auto-Recognizing New Vendors
Look for solutions that AUTOMATICALLY detect new invoice formats and can find the data. Forever on-going maintenance to “set up” OCR with each new vendor can become a headache, especially if you're an organization that frequently has new vendors.
Emailed / Scanned Documents
A/P Automation solutions should provide the ability to email documents and/or manually upload documents to begin the process. Not everyone can demand emailed invoices so having the ability to scan directly into the solution may be preferred.
Workflows should exist for approvals but those workflows should also be flexible? Want 3 approvals (manager–>manager’s manager–>accounting), want just 1 approval? Ensure the workflow capabilities fit you.
Automated purchase orders, shipments, and invoice matching will provide significant time-savings
Document Warehouses of Your Choosing
Already have a document warehouse that your organization uses and simply want to add-on a solution to better assist with A/P? This can be done as there are some solutions that can tie into nearly ANY document warehouse (and not force you to use theirs). Having a document warehouse for Sales, Inventory, Administration and then a totally separate warehouse that just houses payables may not be ideal.
Solutions should have native integrations with your Microsoft Dynamics ERP and this should be a heavy ranking factor when considering solutions. The good news is that even if they don't, payables are relatively straight-forward documents and they can certainly spit-out a flat-file that then becomes your responsibility to integrate into your Dynamics product.
The A/P Automation solution is rarely the system of record (the ultimate truth). It’s typical to manage vendors/payees in another solution & then use that information in your A/P Automation solution. Therefore, it should be just as important to integrate data into the A/P Automation solution (vendors, items, etc.) as it is to integrate data from the solution (approved payables documents).
3-way matching going to be of need? Ensure the ability to import purchase orders to assist with this process is available.
Add-Ons Modules ➕
There are 2-sides to Accounts Payable. Processing the invoice & issuing the payment. Many solutions provide the ability to automate the payment process in order to complete the entire A/P cycle. If you're tired of processing checks manually inside your Microsoft Dynamics ERP, consider this as an option.
Expense reports and A/P go hand-in-hand and many solutions provide modules to handle both. There can be a benefit to having both in the same place for reporting and consistency’s sake.
Accounts Receivable Automation
A/R & A/P. 2 peas in a pod & solutions may accommodate both sides.
General Document Warehouse
Want to keep more than just your payables in this new system? Look for solutions that offer 'A/P Automation' solutions but also provide the ability for you to maintain other document types in the warehouse as well (Sales information, inventory, administration, etc.). All documents in a secure, backed-up solution can make your life much simpler.
Canned reports are meh. The power of reporting should be in your hands via ad-hoc reporting capabilities (ie.) move your data around and build your own reports).
Budgeting vs Actual Reporting
Many solutions offer budgeting capabilities to help your organization ensure your expenses are staying in-line.
Visualizing data is key, especially for high-level users.
A Focus on Reporting in your Microsoft Dynamics ERP Instead of Within the Solution
Do you love the reporting capabilities inside of your Microsoft Dynamics product (you should!)? If you know that you want your payables-related reports coming out of Microsoft Dynamics instead of inside the stand-alone A/P Solution, these solutions exist (and may lead to a more simple and more price-friendly solution as well)!
It's a guarantee that your audit team will ask for approval support for invoices. Ensure you have the ability to look at an individual documents audit trail as well as run reports on audit history (ex.) Show me all approvers for invoices for our United States locations)
Do your research before on if on-prem or cloud offerings make more sense for your organizations. Accounts Payable Automation solutions will continue offering both. Just because you have an on-prem solution doesn't mean that you won't be able to access the software remotely.
Out of sight, out of mind. Put your documents, your software, everything in the cloud and don't worry about having to buy servers or pay an IT team to manage your application.
Some solutions offer a blend of both, cloud components along w/ on-prem (ex.) Documents stored in on-prem SharePoint while the application itself is cloud-based).
Organizational Structure For Multiple Divisions, Regions, Etc.
Solutions should provide you with the ability to set up your org chart for transactions, reporting, security, and/or workflow purposes.
Ensure your solution provides you with plenty of ability to capture any information that your business requires. You never know what you'll want to tag to payables transactions in the future.
A/P processors and approvers occasionally need detailed support in order to process the document. Ensure you can attach this additional support to documents.
Transaction Processing Defaults
The key to automation is obviously to have minimal manual interaction. If you can think of defaults that should be able to be set in the system (let’s say an A/P account depending on the user), look for solutions where you’re able to implement your logic.
Tap into historical or live foreign exchange rates on both the invoice entry and payment execution ends.
Security for processors, security for approvers, security for making changes/deleting, security by Org Structure.
Being able to process invoices on the go is great but being able to approve them on the go is even greater. Look for mobile apps or at least mobile-friendly solutions.
Remember that missed requirements/features are the highest contributing factor (~71%) to software implementation failures*. Be thorough with what your business needs, work closely with the solution vendors to ensure there is a fit BEFORE PURCHASING, and ensure you have the best solution that fits your business.
Which of these features are you excited about? Comment below and let us know!
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