Outsourcing accounts payable is fast becoming a standard business practice that aims to delegate the trials of invoice processing and payment to a trusted partner while focusing precious internal resources on developing and enhancing a business’s core competency.
Despite the transformation brought about by automation, many internal accounts payable departments still find themselves flying blind when it comes to everyday operations. Invoices come in via mail, electronically and many even have to be collected on-site. Once received and collected, in most offices, these invoices are still processed by hand and then sent to multiple reviewers for approval. As the invoices sit on the desk awaiting signatures, many are simply lost under the pile of incoming documents and hence, remain unpaid. In fact, an invoice can go unpaid simply because the reviewer is out of town or unavailable for some other reason.
These unnecessary delays don’t just waste time but also drive up your invoice processing costs both directly and indirectly. This is where outsourcing accounts payable comes in, it simply takes the more tedious aspects of accounts payable off your plate while reducing costs and improving returns.
Apart from the lower cost of processing, outsourcing accounts payable also enhances efficiency while reducing redundancies and wastage to make way for faster payments and lesser fines. Additionally, as your invoices get cleared on time, you get to enjoy a much more positive relationship with your vendors as everyone is happy when the payment arrives on time.
At ARDEM, our process specialist engineers customized solutions that aim to streamline and advance our clients’ accounts payable processing while helping them achieve their current and future goals.
Let’s see why outsourcing accounts payable is the right step for your business:
Increased Accuracy
One of the most common problems in accounts payable processing is the continued dependence on manual processing that is quite prone to delays, errors and careless mistakes. This means that apart from carrying out the usual accounts payable processes, your team actually spends a considerable amount of time chasing down these errors to their source and correcting them.
On the other hand, outsourcing these same processes to an experienced firm that excels in accounts payable processing means that your invoices are processed by a team of experts that specializes in capturing and processing your data accurately, thereby avoiding errors, tracking down all exceptions and ensuring a seamless payment cycle.
This is achieved by using a combination of automated data capture and effort-based processing that ensures up to 99.97% accuracy every time for every invoice.
Assured Cost-Savings
One of the primary advantages of accounts payable outsourcing is the immediate savings in terms of processing costs. With ARDEM’s services, you will experience an immediate reduction of 30-40% in your processing costs. Apart from the initial savings, our team will continuously improve your process to provide increased cost benefits to you.
Another major advantage of outsourcing your AP function is increased visibility into your current spending patterns that empowers you with actionable insights to control expenditure.
Avoiding Overhead Costs
Another major source of saving while outsourcing accounts payable comes is the steep reduction in overhead costs, i.e., the cost of acquiring new employees and upgrading your systems, etc.
Apart from the cost of hiring new employees, re-training your existing team members to adapt to the latest methodologies and technology is also quite an expensive undertaking. Even once the immediate skills gap is bridged, you still have to consider the impact that any future technology or even disruptions can have on your current team.
However, by outsourcing your accounts payable, you can reduce your overhead costs by at least 50% or more. You no longer have to even worry about hiring or training as your outsourcing partner will hire and train analysts virtually to execute your entire function.
Additionally, accounts payable processing solutions employ advanced automation and accounting software to achieve more with less. You can enjoy the benefits of immediate scalability, without having to undertake the hassle of hiring and training new employees every time you expand operations
OCR Invoice Capture + Effort-Based Processing
Automation has truly transformed the accounts payable process, but it’s still not enough as the invoices come in varied formats which can be quite confusing for the automation technology. Even once the OCR technology is able to map out and identify the different incoming vendor forms, the invoice formats can be changed or upgraded by the vendors themselves, thus creating another challenge.
This is exactly why the best accounts payable outsourcing solutions combine OCR data capture with effort-based manual processing to offer a more comprehensive and effective solution. While automation improves speed, accuracy and minimizes the headcount requirement, manual supervision ensures that human intelligence catches any exceptions or variation with ease.
Integration with Your Existing ERP
No need to invest more money in updating your systems, as the best accounts payable outsourcing companies have the tools to integrate with your existing ERPs and even upgrade your current system if required.
At ARDEM, while improving your accounts payable processing, we also utilize the full benefits of your existing ERP and integrate with your current team. We work to eliminate redundancies in your processes, check for any duplicate or incomplete invoices and standardize multiple vendor formats for faster turnaround.
Faster Approvals
In the accounts payable cycle, once the data from incoming invoices is captured and processed, it has to be forwarded to the relevant authorities for approval and payment. This crucial step represents another major hurdle that needs to be cleared for prompt and timely payment to vendors.
Most of the time, these paper invoices can just sit on the desk, waiting for approval while getting buried under a pile of paperwork. Similarly, any emails sent can get lost in the stream of incoming messages. At ARDEM, we employ a cloud-based solution to accelerate your approval process, enabling your team to review and approve invoice via a few simple clicks.
Once the invoices have been approved, all payments are made electronically through ACH/Wire for swift and efficient payments.
Managing Exceptions
Most organizations agree that one of the biggest challenges in the accounts payable process is presented by a large number of exceptions and the bottlenecks they create.
These exceptions are determined by cross-matching various documentation to the original invoice to discover any errors or discrepancies. This variance in the figures is often the result of inaccurate data or duplicate bills, etc. While certain processes such as data extraction can easily be automated, effort-based processing backed by human intelligence is required to untangle the knot, i.e., identify and correct inaccuracies.
Immediate Scalability and Flexibility
As anyone who has ever processed accounts payable will know, the inflow of invoices is not always consistent with the flow fluctuating from a few invoices trickling in per day to a veritable storm of invoices arriving during certain peak periods, i.e., at the beginning and end of the month.
ARDEM has processed millions of invoices for its clients and our team is well-versed with the ups and downs in the volume of incoming invoices and we, therefore, adjust our services to manage your fluctuating needs.
As your overall processing requirements increase, we allocate more bots and more analysts to your process and ensure that your works never stops, come what may.
Another useful tool that comes in quite handy while processing your accounts payables is the ARDEM Invoice Manager, an internal cloud-based digital collaboration platform that allows our clients to share their data directly and download the output directly, with a few simple clicks.
The ARDEM Invoice Manager (AIM)
The ARDEM Invoice Manager (AIM) is a cloud-based network that allows you to gain better visibility to improve your AP and invoice processing. With easy-to-use and customizable features, our live dashboard provides you with an overall view of all of your current invoices and real-time updates on the status of your project.
Not only can you see how many invoices were received, but also which stage they are currently in to ensure a smooth payment process. Your dashboard can be further customized to show the different trends from the number of PO to non-PO invoices received monthly, to how many invoices you have received throughout the entire year.
How It Works:
Email, Scan or Upload Invoices
You can mail physical invoices directly to ARDEM where we sort, scan, and upload the images to the cloud network or even email them directly to us.
You can even simply upload all invoices directly to the ARDEM Invoice Manager by logging in. Auto-generated notifications will be sent to confirm the receipt of all invoices.
Streamlined Approval Process
Once invoices have been uploaded onto the ARDEM Invoice Manager, they will be 3 or 4-way matched, reviewed, and an auto-generated notification will be sent for multi-level approval.
Easy Integration
Electronic and physical vendor invoices are processed via ARDEM Data Capture to map out different vendor invoice formats and normalize the extracted data.
This data can be further reviewed and edited in the ARDEM Invoice Manager, saved, and downloaded in easily ingestible file type, reducing the need for a large IT overhaul.
At ARDEM, we are fully equipped to manage your entire AP function from start to finish, evaluating, assessing and engineering an upgraded workflow to deliver superior results while ensuring superior savings.
If you would like to learn more about how we can ensure a smoother transition for your accounts payable, please feel free to get in touch with us and schedule a free consultation to discuss your processing requirements today!