According to PayScale.com 58% of accounts payable managers have 10+ years of experience and 25% have 20+ years of experience so its safe to say that many managers have, and expect a long career in accounts payable. With the increasing adoption of technology and automation, are the industry and its jobs at risk?
A significant percentage of invoices are still being received in paper format, which along with manual invoice approvals, mean that accounts payable remains a very labour intensive process. Whilst automation solutions exist they are often a complex and expensive underaking and mainly only adopted by the largest of companies which benefit through large volume operations.
Below lists the main reasons why accounts payable remains such a manual process.
The prevailance of paper based invoices
Most suppliers have both the facilities and ability to provide invoices in PDF format by email, yet wether through poor supplier onboarding or business’s not realising the potential benefits of digital invoices, they are not insisting the supplier provides invoices by email by default where possible. Posting invoices is a process of the past but businesses still remain slow to adapt.
Manual invoice approvals
Many companies have the purchasing department approve non purchase order invoices or receipt goods once the invoice has arrived which can cause the speed of processing to grind to a halt until a back and forth communcation between purchaser and accounts payable assistant has occurred.
Inefficient manual data entry processes
Data entry of invoices involves entering fields from invoices from many different suppliers, each of which will have the data formatted sligthly differently or have a different invoice layout and is highly subject to human error, each of which causes more issues to resolve.
Accounts payable has long been seen as just a cost of doing business, but it is a variable and not a fixed cost and even with the many benefits of automation such as quicker approval of invoices, increased employee productivity and lower processing costs, it is not until the accounts payable department has scaled significantly that automation is considered.
Barriers include cost, management willingness to invest in new technology and the staff training and upfront time investment.
There are still a number of barriers slowing the adoption of accounts payable automation. So accounts payable departments are here to stay for now.