Many organizations around the globe dealing with accounts payable (AP) are seeking to improve their operational performance. Even though many financial set-ups have embraced different processes to flourish, the accounts payable department is yet to evolve more. For that reason, AP must cater to process, labor and technology needs, which is challenging.
A new survey report by Canon (News - Alert) Business Process Services, a provider of managed services and technology that facilitate organizations to improve operational efficiency while reducing risk and cost, has revealed three key drivers that can augment the operational performance of AP departments.
In its research report, “High Performance Accounts Payable: Three Key Drivers to Success,” Canon Business Process Services has highlighted key findings about operational characteristics of high-performing AP departments.
The report has accessed how high-performing AP functions differ from the average through six performance indicators like cost-per-invoice, and how the three drivers – namely centralized invoice receipt, AP process automation and leveraging outsourced services - can provide an advantage for each of the indicators.
Precisely, Canon Business Process Services’ research report cites that accounts payable (AP) departments, which have achieved best-in-class status, are able to process invoices at a cost of $2.20 per invoice, 88 percent lower than the average AP department.
Predominantly, the average time to process an invoice (cycle time) is an important performance indicator for organizations to monitor. Canon Business Process Services’ report cites that high-performing AP operations can process an invoice 4.5 times faster than average organizations, apart from achieving lower invoice costs.
In addition, Canon also believes that centralized invoice receipt coupled with scanning and automated data extraction can enable organizations to quickly reduce their cycle time.
The report also advises AP operations to adopt key best practices, such as centralizing invoice receipt, automating paper to digital workflow and leveraging offshore processing.
“Organizations continually look for ways to improve operational performance. Today, that objective includes accounts payable,” said Elizabeth Halaki, chief marketing officer and research and development for Canon Business Process Services, in a statement. “Transforming an accounts payable department from a mainly paper-based, manual function to an automated, high-performance operation entails addressing process, labor and technology requirements. Our new research report provides the most current data and insights on how to meet these requirements and raise the performance bar for AP operations.”
Edited by Cassandra Tucker