We all know that purchasing goods and paying invoices can be a laborious process using a mix of people processes and technology. In recent years regulatory compliance has added layers to the process by requiring documented processes that segregate duties and have standardized steps that provide checks and balances. All under the watchful eye of auditors and regulators.
Over the last 25 years purchase-to-pay (P2P) solutions have gone from being an optional ‘nice to have’ to an essential component of finance and procurement departments. This has been driven by benefits including cost savings, increased accuracy, enhanced audit trails and greater efficiencies – to name a few.
Growing Finnish machine rental company, Renta, has built its operation on digitalised processes from the start. By automating its financial and purchasing processes, the company is able to focus on growing the business, as well as benefit from increased efficiency and cost savings. Technological development is causing turmoil in most industries: on one hand it’s forcing companies to change their ways of working, but on the other hand, it’s giving them the opportunity to do so. In Finland, digitalisation of financial departments is already advanced and financial processes have been digitalised by invoice processing systems for quite some time. Many of these systems have been implemented years ago, which means the technology is already becoming outdated. The latest technology enables continuous software development and far more efficient ways of working.
There are many stakeholders in the purchase cycle. “Who is responsible for what” is often muddled between layers of multple business processes and the various roles employees play. It’s not that roles may be unclear about purchasing policies, but rather a lack of transparency by design. This is particularly relevant in organizations that are reliant on paper-based processes, or when their ERP does not have the ability to provide flexible approval workflows. As a result, organizations are looking to optimize the purchase process to improve accountability as well as visibility. This can be done with automated Request to Pay.
Last year, a report revealed that only 95% of SMEs are still using some kind of paper-based, manual process in Accounts Payable. While it’s well known that automation solutions can help businesses save time and improve their bottom line, adoption of automation solutions remains fairly slow. Indeed, new figures show 35% surveyed businesses have no plans to switch to automation – and companies with AP automation remain unsatisfied with manual touch points when paying suppliers and reconciling payments. However, those who are satisfied with their current AP automation solution report huge benefits.
This case study examines how a major manufacturer with 11 manufacturing plants worldwide transformed their procure to pay process using robotic process automation. Results include:
70% drop in cycle time
43% reduction in processing costs
20% increase in invoice volumes with no increase in staff
Once an invoice is entered into an ERP it is assigned a “match/no match” status. If for any reason there are price differences or problems with the goods receipt, the invoice cannot be processed by the ERP. Users or knowledge workers typically have to cancel the transaction, and then perform time-consuming manual work to clear the exception. This usually involves the purchaser, the receiver and sometimes the vendor.
We all know that purchasing goods and paying invoices can be a laborious process using a mix of people processes and technology. In recent years regulatory compliance has added layers to the process by requiring documented processes that segregate duties and have standardized steps that provide checks and balances. All under the watchful eye of auditors and regulators.
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