As businesses face increasing pressure to reduce operational costs and improve efficiency, Accounts Payable (AP) automation has become a critical focus area. By replacing manual processes with automation, organizations can unlock significant savings, enhance productivity, and improve cash flow management. To understand the full potential of AP automation, here are ten data-backed insights that highlight its transformative power:
1. Economic Growth Challenges Demand Cost Optimization
According to the International Monetary Fund (IMF), global economic growth over the next five years is projected to stagnate at 3.1%, the lowest in decades. To navigate this challenging economic climate, businesses must leverage tools like AP automation to:
- Cut invoice processing costs.
- Optimize cash flow with AI-driven insights.
- Generate additional revenue through early payment discounts.
2. Manual Processes Dominate Despite High Costs
Approximately 40% of transactions in businesses are still conducted using manual checks—the least cost-effective payment method. The inefficiencies of manual invoice processing, including postage, paper costs, and delays, present significant opportunities for automation to streamline workflows.
3. Digitization is a Priority for 76% of CFOs
A survey reveals that 76% of CFOs prioritize the digitization of finance processes. Paper-based AP methods are not only costly but also susceptible to errors and fraud. Automation addresses these concerns while enhancing remote work capabilities and operational efficiency.
4. Employee Dissatisfaction with Manual Tools
Nearly 96% of employees express dissatisfaction with the tools provided for their work, particularly when faced with repetitive tasks like manual data entry. AP automation alleviates this burden, allowing teams to focus on strategic, value-added activities.
5. Human Errors are Costing Businesses
One-third of accountants admit to making financial errors multiple times per week due to capacity constraints. Additionally:
- 7.5% of documents are lost.
- 3% of documents are misfiled.
Automation minimizes these inefficiencies, saving businesses valuable time and resources.
6. Data Entry Consumes Up to 3 Hours Daily
Around 76% of office workers spend up to three hours a day on data entry tasks. AP automation eliminates these inefficiencies by:
- Capturing invoice data automatically.
- Streamlining approvals and searches.
- Reducing reliance on manual inputs.
7. Automation Boosts Satisfaction and Efficiency
A staggering 95% of companies that have adopted automation report streamlined processes like data entry, invoice approval, and document retrieval. Automation allows businesses to customize workflows, ensuring optimal efficiency.
8. Cash Flow Improvements Reported by 84% of Automated Companies
AP automation reduces invoice processing costs by over 80%, enabling:
- Annual savings of $60,000 to $70,000 for businesses processing 500 invoices monthly.
- Increased cash flow through reduced payment delays and optimized expense management.
9. Operational Costs Cut by 20% Through Automation
Process automation can reduce operational costs by up to 20%, freeing finance teams from repetitive tasks like invoice validation and approval correspondence. This fosters a balanced workload and enhances employee well-being.
10. Time Savings of Over 70%
Manual AP methods typically process five invoices per hour, while automation accelerates this to 30 invoices per hour—a productivity boost of 600%. This enables businesses to reallocate up to 70-80% of the time spent on AP activities to strategic initiatives.
Transform Your Business with AP Automation
The numbers don’t lie—AP automation is a game-changer for organizations aiming to enhance efficiency and drive growth. By automating invoices, streamlining processes, and improving accuracy, businesses can unlock unprecedented savings and productivity.
Sources:
IMF – https://www.imf.org/en/Publications/WEO
Oracle – https://www.oracle.com/erp/cfo/cfo-priorities/
Forbes – https://www.forbes.com/sites/bryanrobinson/2023/03/10/employees-are-overloaded-96-say-workplace-tools-arent-helping-them-keep-up/
Pymnts.com – https://www.pymnts.com/news/b2b-payments/2022/b2b-payments-40-are-made-with-paper-checks/
