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How to Automate AP and Improve Invoice Management
Invoices are rich in spending details that inform the past, present, and future of your business. They’re details that enable spending visibility, compliance, and data-driven decisions. But invoice management is often tedious for the accounts payable (AP) team, taking them away from more strategic work. Intelligent, AI-powered AP automation provides a mechanism for businesses of all sizes to improve invoice management and workforce productivity, and for AP teams to expand their contributions to the company’s success.
Successful AP Automation Requires Groundwork and a Plan
As with any sizable change to an organization’s technology and processes, a sound approach is to educate yourself about AP automation, understand its impact and advantages, and consider what it will take to improve your accounts payable process.
In this blog post, we’ll outline five key steps to help you get started on your AP automation journey, including:
- Setting a baseline for improvement by assessing your current AP process and the costs involved
- Determining exactly what your business hopes to accomplish through AP automation
- Understanding artificial intelligence’s (AI) transformative role in invoice processing
- Learning how better spend visibility and integration fuel insights and improve AP processes
- Achieving the flexibility needed to navigate uncertainty and pursue growth opportunities
Need to make the case for accounts payable transformation? Businesses that add automated AP solutions to their integrated travel and expense (T&E) platform process 64% more invoices monthly and achieve average savings of 20%.
Your Guide to Better Invoice Management
Learn five steps you can take to close gaps in spending visibility, improve your AP processes and technology, and help the AP team perform a more strategic role
Get the guide1. How Can We Set a Baseline for Improving AP Processes?
To start automating and improving AP processes, your business must establish a starting point by determining its baseline performance when processing, reviewing, approving, and paying invoices.
Ask questions such as:
- What percentage of invoices arrive on paper, by PDF, or electronically? And do they come to one central location?
- Is the accounts payable process handled on spreadsheets and how many invoices must be keyed in?
- How long does it take to process each invoice and how much does it cost?
- How many people must review and approve each one?
- How often does the business incur late payment fees?
- Is invoice data integrated with other spending measures to provide a full spending picture and insights?
Best-in-class vs. average AP teams
8.72 hours to process an invoice vs. 9.2 days
5.36 hours answering supplier inquiries vs. 3.1 days weekly
Source: AP Metrics that Matter, Ardent Partners, 2024
2. How Can I Determine the Benefits We Want from AP Automation?
You’ve assessed how invoice processing is currently done and what it’s costing your business in time, money, and personnel touches. Now it’s time to ascertain what you hope to achieve with AP automation and fewer bottlenecks.
That may include capabilities and outcomes like:
- Centralized capture of invoices to avoid duplication and errors
- Ability to approve spending before purchase orders (POs) are created
- Incorporation of AI and machine learning to collect and categorize invoice details
- Automatic importation of invoice data and photos into your finance system to create a firm audit trail
- More time for the AP team to focus on exceptions instead of chasing details and suppliers
Speed grows with AP automation
64% jump in monthly invoice processing volume and
13.4% increase in vendor engagement by Concur Invoice users vs. non-users
Source: SAP Concur, in partnership with Phronesis Partners, 2024
3. What Can AI-Powered AP Automation Do for My Business?
AI-powered AP automation is transformative because it streamlines AP processes, curtails manual tasks, and supplies a clear and comprehensive picture of spending. Its thoroughness is powerful, as AI can check every invoice and detail—something even the largest and most adept AP team cannot do as efficiently or at scale. And AI only gets smarter and quicker.
AI-powered AP automation:
- Separates documents and extracts line-by-line details for reports
- Creates and improves templates for invoice capture
- Flags duplicates, unauthorized charges, and other abnormalities
- Streamlines two- and three-way matching of invoices and POs
- Accelerates vendor invoicing and lowers costs
4. How Can Greater Spending Clarity Drive Decisions and Profitability?
AI-powered AP automation result in fast, comprehensive, and accurate capture of invoice information. With the clarity and insights delivered by integrated AP, travel, and expense solutions, businesses can make well-informed decisions enhancing cash flow and profitability.
Your AP team can:
- Spot spending trends and negotiate better rates from vendors
- Zero in on expenses affecting cash flow the most
- Share data that empowers other departments and supports collaboration
- Inform strategy and decisions across the company
5. How Will My Business Gain Flexibility and Agility?
AI-powered AP automation provides businesses and their AP teams potent tools—flexibility and agility—to pursue opportunities and navigate economic volatility and other disruptions. It’s an AP platform integrated with spend management solutions that connect with ERPs and other essential business systems.
It’s technology that makes it easier for companies to:
- Adapt rules, policies, and processes as conditions demand
- Work and scale across teams, borders, languages, and currencies
- Foster alignment among the AP team and other finance functions, empowering AP teams to fulfill a broader and more strategic role that helps move the business forward
Tips to Streamline Your End-to-End AP Process
Discover how an integrated, AI-enabled AP solution can improve data quality, reduce errors, and uncover cost-saving opportunities
Get the ebookFAQ: Achieving the Potential of Intelligent AP Automation
Q: Why is setting an AP baseline important?
A: Before automating AP, businesses need to assess how invoices are received, processed, and approved. Understanding costs, time per invoice, manual steps, and late payment frequency establishes benchmarks for improving AP processes
Q: How do we define the benefits we want from AP automation?
After evaluating current accounts payable processes, organizations can identify such goals as centralized invoice capture, fewer errors, AI-enabled data extraction, stronger audit trails, and freeing AP teams to focus on exceptions.
Q: What can AI-powered AP automation deliver?
A: AI strengthens AP by extracting detailed data, separating documents, flagging duplicates, and streamlining matching to purchase orders. It reduces manual work, accelerates invoice processing, and improves accuracy over time.
Q: How does improved spend visibility support smarter decisions?
Integrated solutions unify your AP, travel, and expense data for clear insights into spending patterns, helping companies negotiate better vendor rates, manage cash flow, and inform broader business strategy.
Q: How does AP automation increase business agility and resilience?
A: AI-enabled AP solutions connect with other key business systems, making it easier to adapt policies, scale globally, and support strategic growth. Businesses with integrated, automated AP process 64% more invoices and save about 20%.
