Why Vendor Payment Automation
Due to COVID-19, the number of remote employees in the U.S. has tripled virtually overnight. This has had the effect of pushing companies to rush their Digital Transformation (DX) initiatives. While many companies' DX is now years ahead of what they anticipated in early 2020, this has resulted in some critical pieces of the DX puzzle falling through the cracks. If you are an IT services provider shoring up these holes for your clients' or a decision maker working on your own company's digitalization, vendor payment automation should be high on your list of priorities. We're going to tell you why.
1. Streamlines a Clunky Process
Before DX and automation, invoice processing and payments was a clunky process, maybe the most clunky in the back office. It requires multiple steps such as getting approval signatures, manual data entry and stuffing envelopes. A successful DX strategy reduces friction and manual workloads, and vendor payments automation is a critical part of doing that in any accounting department. If this wasn't part of your early phase transformation it is a great place to really polish up your DX strategy.
2. Remote Work
While the cloud-based tools now available have made it possible for businesses to survive quarantine, there remains a lot of team disconnect for many companies. The right payments automation software will not only allow accountants and clerks to work from home, it will make it easier for accounting teams to stay on track with alerts, reminders and workflows to reduce the risk of invoices getting lost in the shuffle.
3. Cost Savings
We beat this drum a lot so we won't dwell on it in this post, but the reality is that vendor payment automation is a major cost saver. Learn More
4. More Control and Audit Readiness
With added level of insight, traceability and visibility, a payments automation solution will help you gain more control over your accounts payable process. With built-in controls, the right software solution will help you reduce the risk of fraud, security threats and duplication. These controls will also help you reduce stress and be better prepared for audits.
5. Vendor Relations
While it used to be true that setting up digital payments methods, like ACH and Direct ACH, would come with some feat-dragging or even pushback from many vendors, things have changed. Like you, vendors have had to go through the same rapid DX turnaround and have even been forced to reduce their number of back-office employees. More than ever it is easier to gain vendor buy-in to make your digital payment automation easier because everyone is trying to do more with less these days. Plus with strained supply chains and reduced cash-flow, your vendors will appreciate the added layer of certainty that they will be paid on time thanks to automation.
Of course these factors only scratch the surface of what is possible with the right vendor payments automation tool. But if you have undergone rapid digital transformation in the last year and have yet to digitize your AP process with an industry leading automation solution, this is a place to score big in your DX strategy.
