Medium Size Accounting Systems and AP Automation

I am working though giving advice on different accounting system and Accounts Payable Automation. Yesterday I wrote about large system and AP Automation, today’s topic is on medium size accounting system. As wrote in my last post, it is difficult to identify one accounting system to another based on size, so I am using the accounting system that serves a particular size of companies. For day I am writing about the accounting system that service midsize company.

They Rule The World

I am a huge fan of midsize companies. Like the title suggest, the midsize company are the majority of companies in the United States… I don’t know about the world (I still needed a dramatic title). According to the Economist online the definition of a midsize company are those companies that are from $10 million dollars to $1 billion dollars in revenue per year. Also based on research done by The National Center of the Middle Market, in 2011 there are 197,000 such companies in the US. I also recently heard that 85% of people who are employed in the United States are employed by midsize companies.

There are a Ton

With statistics like the ones above, you can imagine that there are a lot of accounting systems that serve the middle market, and just like I wrote yesterday some of the mid-market accounting system also do work for large and small companies. However, I want to give you an example… Microsoft Dynamic – Great Plains. Great Plains is a system that has been around for a long time and is the perfect examples to give advice about medium size accounting system and AP Automation.

Here It Is…

The biggest problem that leaders in midsize company has, when it comes to AP Automation, is the notion of headcount reduction. The myth (and it is just that) is that Accounts Payable Automation is only good for firing people. It is true that headcount reduction is the quickest way to a return on investment (ROI), however for medium size organization they don’t have the ability to layoff people in accounting. I do a lot of work with midsize companies and a lot of data gathering, I have found that when a midsize company automates accounts payable they are about to:

• Involve 28 People
• Free Up 8200 Hours
• Create a ROI of $120k Annually

Looking at the number, AP Automaton affects 28 people. but the 8200 hours does match up to the number of people. AP Automation will free up time, but it will be percentage of people’s times, not whole jobs/tasks.

What Do I Do?

(Good question) For Accounts Payable Automation to work for medium size companies there has to be a plan for dealing with the percentage of time being freed up. The plan is the most important thing, and the task that are going to be done has to be more important and impactful then the tasks that have been freed up. Let me put it this way, if your midsize company needs more time in accounting,  AP Automation is a great way to get that time.

Want to know more, you can read about it in the Argument to Automate… see the link below

You Should Buy My Books!

To buy the book – The Argument to Automate – How Innovation Can INSPIRE Not Fire – click here to buy

(Also) To get your copy of The 8 Pitfalls of Accounts Payable Automation – click here to buy