Would you believe that accounts payable processes can be dramatically improved in just five steps? A few simple procedures can enable you to smooth out efficiency issues, reducing the amount of time spent on each individual invoice. Following these readily implemented fixes will enable you to save a great deal of time, effort and money in the long run.
AP Process Improvement Step One: Get Set Up to Accept Electronic Invoices
The first step in streamlining your accounts payable procedures is to eliminate paper invoices. If you’re still using them, you must begin making the push towards moving to a full-time, standard electronic invoicing practice. Most suppliers today will be glad to send you a PDF invoice that doesn't need to be signed, checked and scanned. This means no more faxing, as well. Making the switch to electronic invoicing is an upgrade that will ultimately allow you to complete invoicing and bill payment significantly faster than ever before.
AP Process Improvement Step Two: Break Free from Paper-Based Data Entry
The next step in improving your accounts payable procedures is to start getting rid of the paper trail associated with data entry. You may not be in a position where you can simply refuse paper invoices from all your associated vendors, but you can strongly encourage them to do so. You may even consider offering rewards and incentives to your suppliers when they set up electronic invoicing with you.
In the meantime, you can centralize scanning for any paper-based data that you still have to process. You can most easily do this by hiring a qualified service to take care of the tedious labor associated with parsing the data and entering it into your data files.
AP Process Improvement Step Three: Make Your Invoicing as Automatic as Possible
The third step for improving accounts payable is automating your entire invoicing cycle from start to finish. This is the best way to streamline this time-consuming process. The time you invest in automating your billing will pay off huge dividends when it allows you to get through a boatload of invoices with an easy, efficient new routine. You’ll likely find that the time it takes you to collect, approve and scan invoices will be significantly reduced. The end result? More time to concentrate on other aspects of your daily operation that require immediate time and attention.
AP Process Improvement Step Four: Standardize as Many Processes as Possible
It’s a common occurrence, in many businesses that don't have an efficiently streamlined and automated invoicing mechanism, that vendors tend to send their invoices to every department in the office with the exception of AP. Imagine for a moment the confusion and frustration that you would experience if you were waiting a week or longer for an invoice that you didn't know you already had! What’s worse, you could irritate your vendors with requests for invoices they had already sent.
The main goal behind standardizing your invoicing procedure is to allow for a smooth, orderly system that lets you account for each new invoice as soon as it comes in. From the moment you receive an invoice, preferably electronically, you can have a specific set of steps to see that transaction through, end-to-end. A neat, organized operation doesn’t just benefit you, but all your employees and customers.
AP Process Improvement Step Five: Archive Your Data as Soon as Possible
Perhaps the most important step of the streamlining effort is when you finally move to archive all your incoming invoice data. Who wants a dusty, potentially disorganized file cabinet full of paper invoices? It's so much easier to file everything digitally. Cloud storage technology has rapidly advanced in the last few years, becoming more affordable, easy to implement and expandable for your growing and changing business needs. It's an excellent idea to add a digital archiving annex to your office in order to quickly receive, process and store all of the information related to your invoices.
Efficiency is the key when it comes to improving your accounts payable procedures. By eliminating paper and leveraging automation tools, your organization can achieve a high level of accounts payable efficiency, freeing up time for your AP staff to handle other key tasks for your organization.
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