The path from invoice to payment is one that every company has to follow For some companies, the path is smooth; for others, the process is akin to a root canal. One of the key differentiators, however, is the amount of automation present in a company’s processes—highly automated companies are able to minimize the time and effort it takes to process and pay invoices, while others are held back by manual processes and errors. Today, we would like to take a look at two common myths that exist when a company looks to the cloud for AP automation and share an opportunity to learn more.
Myth 1: Automation is Too Expensive
One of the most prevalent and dangerous myths is that it’s too expensive to get out of the status quo. This argument comes as a result of the “sticker shock” of moving from something “free” to something that costs money per user. For small businesses, this is short-term thinking, and it’s dangerous—especially when you look at the labor costs that come from manual processes.
Fact: Can You Afford Not to Automate?
How much time and money does it take to process an invoice? If your organization is like many others, the costs are glaring. According to a recent Institute of Financial Operations (IFO) study
- 50% of invoices are still received by paper
- 37% of invoices are still received by e-mail
- 5% of invoices are still received by fax
This means that 92% of invoices still require some form manual entry. On top of this, it’s estimated that 20-40 percent of invoices involve exception processing, often doubling, sometimes tripling the transaction’s timeline and cost. Add on top of this the time and labor it takes to process and pay an invoice, and the risks and costs associated with duplicate invoices (potential outlays of $12,000/month), and the real question: How much longer can you afford to not automate?
Myth 2: The Cloud Isn’t for Me
Whether you think you’re too big or too small, you’re wrong. Once upon a time, enterprises thought “we’re too big for the cloud.” This argument fell apart when companies realized that the implementation speeds were faster and the security was equal or better than they had themselves. Now, apparently, there is a myth being presented that small businesses are not ready for the cloud. This is untrue, as well.
Fact: Regardless of Size, Scope, or Focus, the Cloud Makes Sense
Faster implementation? Check. Better security than you could otherwise afford? Check. Per-user pricing that works for companies who have 5, 50, or 5,000 users? Check. Whether you’re a small startup or a large multinational, the cloud is built to suit you.
Three More Myths… Debunked
Our friends at SAP Concur recently released AP Automation: Fact or Fiction, a guide for debunking some of the most common myths about automating accounts payable with a cloud solution. Above, we shared our own take on two of the more prevalent myths, but you can view three more of them by reading the entire guide here.