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Are SMBs Apprehensive about Automating Their Procure-to-Pay Process?
Are SMBs Apprehensive about Automating Their Procure-to-Pay Process
?Ever-growing regulatory restrictions apart from demands for increased agility are not new to SMEs. In a recent survey by
Paystream Advisors
More than half (51%) of the SMEs surveyed stated that one of the primary challenges they face in the accounts
payable process is manual data entry and the errors and inefficient processes that arise as a result of it
It was found that decentralized invoice receipts and lack of workflow tools have made it very difficult for 50 percent of
organizations to route invoices and approve them in a timely manner, leading to late payments and missed discounts
Automation of the procure-to-pay process is shunned upon because of the misconception that it is too expensive, while all
it requires is due diligence and defining the right tools to automate. I believe that there is a lot that you can gain from
automation, and here are a few reasons why you should automate:
You can enforce rules upfront, and these workflow rules automatically create clarity on various procure-to-pay
processes. First, any ambiguity on who the approver is can be done away with. Treading this path implies that the
company does away with the usual anomalies that are quite rampant in traditional procure-to-pay processes, and often
require the entire process to be repeated
There is instant access to data that reveals who is spending, what they are buying and from which vendors even if
the spending does not originate through the approved procurement process. Needless to say, this could be your best
support for enforcing internal controls
There is a paradigm shift in the way the C-level regards the procure-to-pay function today. It is no longer a cost center,
and is instead, viewed as a profit center. Thus, you need to find innovative ways to plug leakages due to delays
You can capture early payment discounts more effectively, thus driving down your costs One of our leading clients had
numerous non value-added and manual tasks, including paper-based approval of requisitions / POs, labor-intensive
invoicing process and painful exception management for non-PO invoices. Following the automation of their systems,
the client saw a number of benefits, including creating / changing purchase orders with a very short turnaround time;
streamlined invoice processing with minimum exceptions and better compliance with payment terms.
I believe that as an SMB, automating the procure-to-pay process will only lead to increased efficiencies, leaving
considerable scope for you to re-position your staff to other strategic activities.