Everyone wants and expects instant access to information. People demand the ability to conduct business at any time and from any location. Just as importantly, they want this capability now: Solution implementations must be quick and easy. These expectations ring true across the business spectrum, from end customers all the way to back-office teams such as accounts payable (AP).
AP teams especially require insight into transactions so they can better control the invoice processing cycle. Team members want the ability to monitor, approve or deny transactions using any device. Likewise, from a management perspective, finance and accounting managers need quick and easy access to view and validate AP business metrics – all from their device of choice. Even suppliers and vendors are a part of this “instant access” demand, using self-service supplier portals to monitor transactions and information, for greater convenience and improved transparency.
The answer to these needs lies in the cloud. The demand for cloud-based financial applications software continues to outpace the demand for on-premises/other software solutions, according to IDC. The research firm’s Worldwide Financial Applications Forecast, 2018-2022 predicts the split between on-premises/other software and public cloud software will transition from 65.9 percent and 34.1 percent in 2017 to 50.5 percent and 49.5 percent in 2022. As the shift to the cloud continues to accelerate, we take a closer look at the main drivers behind this cloud rush and what a successful cloud deployment delivers.
The benefits of AP automation in the cloud
Organizations of all sizes recognize the advantages of cloud computing, with nearly 37 percent of enterprises choosing a cloud financial management system (FMS) to replace their on-premise deployment in 2018, according to Gartner’s Market Snapshot: Financial Management Systems (FMS), Worldwide. Service-centric organizations are leading this shift to the cloud. However, the total number of enterprises making the move will rise to nearly 45 percent in 2020 and 56 percent in 2022, as more product- and asset-centric organizations follow suit.
The specific advantages of moving AP automation to the cloud include:
- Speed: Cloud-based AP solutions improve inquiry management and expedite discrepancy resolution. An improved ability to match invoices to purchase orders and an audit of transactions deliver additional time-saving benefits.
- Faster implementation: Set-up can be completed in hours and requires no hardware or software investments.
- Lower cost of entry: A subscription-based service that eliminates expensive hardware requirements provides an AP automation solution that is more affordable without sacrificing functionality.
- Faster ROI: A lower cost of entry and quick implementation delivers a faster Return on Investment.
- Scalability: Purchase only what you need, and easily add in new components when you’re ready. Quickly adjust to handle ebbs and flows in volume without changing the underlying infrastructure.
- Reduced dependence on IT: With maintenance and updates handled in the cloud, your internal IT team is free to work on other initiatives that add more value to the business. You may also find you require less internal IT resources.
- 24/7 availability: The cloud delivers around-the-clock access and support, less downtime and constant performance monitoring.
- Mobile access: Access to all AP functionality on a mobile device improves efficiency and insight into the state of AP and allows team members and managers to be more responsive.
- Improved supplier relationships: The cloud provides faster rules-driven invoice processing for approvals and exception processing. This optimizes cycle times and reduces late-payment penalties, saving money via early payment discounts and forging better relationships with suppliers.
The findings of Forrester’s Global Business Technographics Software Survey support the premise that these are the main drivers compelling organizations to make the move to the cloud. When asked how important certain benefits were in the decision to move to a Software as a Solution (SaaS) platform, business decision-makers listed agility (75 percent), speed of implementation (74 percent) and cost savings (73 percent) as the top three reasons. Many of the other benefits they cited pertained directly to software updates, including simpler maintenance (71 percent), immediate access to new features (70 percent), automatic upgrades (69 percent) and innovation (68 percent).
What does successful AP automation in the cloud look like?
A look at real-world organizations that have made the move to the cloud for AP automation provides concrete proof of the many benefits.
Trius is a Belgian IT service provider found it was wasting time manually processing invoices, so it moved to a cloud-based AP automation solution. The system integrates with their ERP and uses Optical Character Recognition (OCR) technology to seamlessly and quickly transfer data from documents to the ERP. Paper archives are gone, as are errors associated with manual processing. Today, Trius uses the cloud solution to process 95 percent of supplier invoices. Processing an invoice now takes just two minutes – 80 percent faster than before. Employees have more time to focus on customer service and relationship building.
As organizations migrate AP functionality to the cloud, the right vendor can make all of the difference. When evaluating cloud-based AP automation solutions, key criteria to look for include:
- Rapid deployment
- Near turnkey implementation
- A highly customizable and secure solution
- ERP integration
- Multi-language and currency support
- Analytics
- Support for electronic invoices
- Approval workflows
- Dedicated cloud operations team
- Reliability
The cloud delivers the level of automation, transparency and convenience that enables organizations to do business anytime, anywhere and from any device. Successful AP solution vendors meet this customer demand with a powerful and robust automated AP cloud solution. As enterprises benefit from lower costs, a faster ROI, easier invoice processing and 24/7 mobile access, more and more companies are finding that a cloud-based AP solution delivers the strategic advantages that enable AP teams to work like tomorrow today.
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Bob Monio is Director, Corporate Product Management at Kofax.
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Tags: Accounting, Auditing, Hardware, Technology
