“By the time I talk to customers, they can’t wait to get their systems automatically talking to each. They know that if their systems could integrate well, not only would they see substantial cost savings, but they would have a more holistic picture of the business,” said J Henry, Director of Integrations at Nexus.”
If your company isn’t using an enterprise resource-planning (ERP) tool, chances are that will change in the next year or so. The ERP drives a company’s financial performance, and is one of the top priorities for new IT spending among CIOs, according to Gartner.
If your company has an ERP platform in place, or is going to get one soon, it makes sense to do whatever necessary to maximize that investment. Since the ERP platform drives a company’s financial performance, integrating it with an automated accounts payable system is a good place to start.
Here are the top three reasons to integrate accounts payable and the ERP platform now.
1) Creating more efficient processes:
If your company’s AP processing is not automated, or your automated system doesn’t integrate with your ERP, then you will have to manual key invoice data into the ERP. This is not only time consuming, it increases the chances of posting errors and duplicate or incorrect payments to suppliers — both of which are major contributors to higher operational costs.
Integrating an automated accounts payable system with the ERP streamlines the process. It saves time and it helps the ERP platform produce a complete financial picture of the organization.
2) Strengthening operational controls:
It is nearly impossible to implement cost-effective controls in an environment where accounts payable is not well integrated with downstream systems. In an integrated environment, invoices route through the system automatically, and stakeholders are able to make decisions based on complete, current information. It is also easier for managers to determine staff productivity, how effective processes are, numbers of invoices processed or awaiting action for approval or dispute resolution, and the time it takes to process an invoice. That is powerful information to have easily accessible
3) Better financial visibility:
Businesses rely on financial data from accounts payable to inform strategic decisions. Integrating an automated accounts payable system with the ERP platform provides visibility into invoices and payables information in real time. Integration means essential data is captured, data is well organized and timely, systems are well integrated, and decision-makers have access to key variables.
What to Look For in an Automated AP Processing Tool
Choosing the right automated AP processing tool is important. Henry points out that it doesn’t do you much good to have a robust AP system that isn’t able to talk to your GL or ERP. “If they don’t integrate, then you’re right back at the beginning doing manual data entry in multiple places,” he said.
Henry says there are three key features to look for when choosing an AP processing tool to integrate with your ERP platform:
1) The flexibility of the system:
It’s important that users can set up their data the way they want to set it up, and then the system accommodates that and works with it.
Anytime you’re translating data between different systems there’s a chance of somebody getting ahold of that data if it’s not secure. The system needs to have controls for that.
As your business grows, the system should be able to handle the volume of data that you’re pushing through it.
Tightly integrated accounts payable and ERP systems provide organizations with improved staff productivity, better control, enhanced visibility, and stronger working capital management — all while reducing overall operation costs. That translates to a clear financial picture and overall peace of mind.