The Accounts Payable task is typically a long and tedious process involving extensive hours of redundant efforts to work through piles of paper-based invoices. According to Ardent Partners’ Accounts Payable Metrics that Matter in 2020, the top challenges holding Accounts Payable back are exceptions, lengthy invoice approval times, and too much paper.
Another big challenge is the time staff spends handling supplier inquiries. Companies need to resolve these challenges to generate value and make better-informed decisions. Outsourcing the Accounts Payable process helps a business attain the desired efficiency. The following steps can be followed to outsource the accounts payable process.
Step 1: Clear Vision
A clear understanding of the business drivers, such that the leadership team and Business Process Outsourcing companies’ efforts can be streamlined in that direction. Benchmarking an Accounts Payable organization to its peers increases the chances for more opportunities and spikes the Return on Investment. According to American Productivity & Quality Center (APQC) benchmarking data, the top-performing Account Payable teams process 4x the invoices to the bottom performers.
Step 2: Location
Identifying whether the business would benefit from offshoring, onshoring or nearshoring and researching business process outsourcing companies accordingly.
Step3: Accounts Payable Sourcing Partner
Identifying an outsourcer who can meet the business requirements and provide technical expertise such as automation and robotic process automation to strengthen operational efficiency.
Step 4: Well-structured Transition Plan
Transitioning to a BPO should be very well-structured as this lays the groundwork for future task accomplishments. A seamless transition along with structured automation tools helps the company reap maximum benefits.
Step 5: Define and Track Service Level Agreements (SLA)
Define SLAs as a measure of specific company metrics, such as cycle time and the number of invoices produced Full-Time Equivalent (FTE). Reviewing and tracking specific KPIs generate a quantitative insight into the overall process.
Accounts Payable Outsourcing helps a company achieve cost and time savings. For example, according to the Society of Human Resource Management 2017 Talent Acquisition Benchmarking Report, hiring one employee can cost as much as $4,425. These costs get mounted and increase the overall expenses to the company. Outsourcing helps in achieving cost optimization.
Outsourcers can provide modern cutting-edge technology to handle the process, which serves as a much better solution. Such tools can guarantee a smooth process and enhance the efficiency of such tasks. With a reduced workload, the employees can work on the company’s core values in a focused manner. Most importantly, outsourcing the Accounts Payable also helps the company attain profitability by getting offers such as early payment discounts.
Smart companies have started outsourcing their entire Accounts Payable process. ARDEM provides Accounts Payable Outsourcing Services for Established Companies. An Agile team in place to provide ease to the client’s existing system enables a smooth workflow. ARDEM offers a customized Accounts payable team to handle varying client needs.
ARDEM caters to its clients by offering a quick setup, efficient processing, faster payments, scalability and growth, control and accuracy. ARDEM uses well-structured cloud-based automation technology to achieve increased efficiency and cost savings.