We surveyed over 350 accounts payable personnel with a simple question of:
“If you could automate one thing, what would it be? And Why?”
Surprisingly, one of the top answers was invoices approvals. And the reason why was time savings. In fact a report developed by Tungsten Network, one of the biggest issues causing late payments was the lack of automated approval (43%). So that got us asking, why is the accounts payable invoice approval process inefficient? Where does all the time go? Here’ what people had to say.
What are the time-wasters in invoice approvals?
- Identifying approvers. When invoices are received and need approval, the first challenge is identifying the approver with authorization to make sure the invoice approval if following accounting procedures. Most of the time is either organizational knowledge where team mates ask each other or send out email requests to other departments.
- Assembling the approval request. When invoices come in, accounts payable professionals often need to collect and validate critical information before sending to the approver. This usually involves logging into the accounting software, manually searching for past records (e.g., is there a PO for this invoice?), manually harvesting the data, and then manually typing out the request.
- Chasing down approvals. This was by far the biggest time-waster. Every accounts payable professional said this is painful and frustrating. The tasks to chase down approvals include sending out not one but usually multiple email reminders, tracking due dates in spreadsheets, and keeping others informed of status. The respondents said this was one of their biggest bottlenecks to on-time payments.
- Preparing and maintaining records. Multiple email conversations need to be gathered and then correlated in order to record and report the approval history. Assembling and maintaining these important records took the second most time in the process.
Use Automation to Get Rid of Time-wasters
With automation, you can improve efficiency of the accounting department and make the process of approvals easier for everyone.
Here are five automations that greatly improve efficiency:
One-click Requests. Request templates, automated data retrieval and previous approver tracking makes it fast to send invoices for approval.
Email Approvals. Don’t make approvers log into a new application. Let them use their favorite application Outlook or Gmail. There are far fewer delays this way.
Approval Monitoring. Maintain visibility and control with outstanding requests and approvers along with automated reminders.
Approve-on-behalf. Approve-on-behalf of allows for non-standard approval to meet specific business or compliance requirements.
Automated Records-keeping. Have the approval software maintain a single integrated timeline of the approval process and associated data and ensure the timeline is archived in a standard structure.
If you’d like to automate your invoice approval process, sign-up for Lockstep. Lockstep is a collaborative application that makes it easier and faster to work with vendors and approvers. Lockstep boosts your AP efficiency with workflow, automation, and search. Contact us for more information.