“SCF can assist firms and their supply chains by increasing the velocity of cash flow and making those flows more consistent. Implemented properly, the firm and its supply chains can enjoy a symbiotic relationship.” - Supply Chain Financing and Pandemic: Managing Cash Flows to Keep Firms and Their Value Networks Healthy, Rutgers Business Review (2021)
Accounts Payable (AP)
In our era of labor shortages and rising inflation, business leaders need to focus on doing everything they can to operate more efficiently and maintain margins and profitability. A key way to do this is by deploying automation that enables organizations to become less reliant on labor.
A wise person once said, “If you do as you’ve always done, you’ll get what you’ve always gotten.” That statement applies to many things in life, including accounts payable (AP) invoice processing.
For decades, AP was a manual process. Vendors mailed paper invoices to customers and accounting teams would perform their two- or three-way match, comparing an invoice to a receiving document and the purchase order (PO) or other purchase authorization documentation.
According to the Institute of Finance & Management, 61% of top global companies have implemented full Accounts Payable (AP) automation. This occurrence has had its challenges.
Primarily, the universal commonality of budget allocation is the obstacle to overcome. When a company’s CFO is prioritising expenditures, their eye remains on cash flow and compliance/risk mitigation. AP must factor into these objectives to achieve funding for automation (or for anything else; with decisions being made by priority).