1. Increased Time Spent On Manual Tasks
What was once a streamlined and efficient workflow has gradually morphed into a time-consuming challenge, demanding more manual effort from the finance function. While AP solutions can bring an element of automation, not all have the capabilities that finance teams need as they grow. You might find your team is still doing the following:
- Manually coding each invoice line item
- Duplicating work in Xero and your AP platform
- Manually reconciling supplier statements
- Login in and out of multiple entities
These manual tasks require a lot of time and energy from an already stretched team. Understanding the need to automate all aspects of the AP function will free up resources to complete more value-added tasks.
2. Limited Flexibility When Scaling
Often, purchase decisions are made for the current state and size of the business. While decision-makers might still need to learn what is coming in the future, it's beneficial to consider solutions that adapt as the business scales.
Your team may require more flexibility than your current solution offers. The system could be lacking important features, failing to offer 24 hour live support or charging astronomical costs for additional entities or users. As you grow, your processes will need to adapt, and you may find that approval workflows or tracking in your current system need more customisation than what is available.
The ability to handle an increase in documents, multi-entity accounts or variable currencies is essential for streamlined operations as the business develops. If your current solution limits the ability to process large document volumes efficiently, it might be time for an upgrade.
55% of businesses claimed that “over-reliance on legacy technology" is one of their biggest challenges.
3. Lack of Detailed Reporting
While automated summary data might have been helpful at the beginning of your journey, decision-makers need detail to get a more precise overview of the financial landscape.
With line item data extraction of invoices, credit notes and purchase orders, automated coding can be applied to each item. This will significantly improve your reporting capabilities, giving you more granular detail for decision-making. Senior finance members can pull customised and specific reports in seconds, decreasing time spent on collating data and increasing time available to analyse data.
4. Slipping Through the Cracks
As the business grows, so does the volume of processed documents. Managing the influx of invoices can become a struggle, but a more significant concern is spotting mistakes manually. You might find:
- Duplicate invoices are processed, which means double payments
- Invoices are missing from payments, and you're losing early payment discounts
- Invoices can't be matched against POs or Good's Received Notes and are paid with incorrect pricing
- Auditors are unable to see an audit trail, causing additional stress and time
- Bank details aren't checked with Xero records before payment, leading to payments going to incorrect banks or fraud
These mistakes can cost the business a significant amount of money. Introducing a system that automatically manages these issues will show an instant return on investment.
Key Takeaways
- Consistently evaluate your existing systems and take proactive measures to upgrade when necessary
- Be selective when implementing a new system and make sure it is future-proof
- Take a note of key data, such as the number of invoices processed per day, week or month and an average of how long each invoice takes to process. Compare this against your new system to highlight efficiency improvements
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