When companies look at Accounts Payable Automation one of their initial desires is to make their operations more efficient . This, by the way, is a very good goal, but the types of efficiency the companies focus on are normally within the accounting department. Even through that’s a great place to look it’s not the only place.
When I talk to groups, live, one of the things that I make clear and get a lot of response from is the fact that accounting, even though it is its own department it is subject to all other departments within the company. What I mean by that is accounting’s process are only as good as the rest of the company decides to do them. The best examples I can give, that also produces the most pain and headaches for accounting, is travel and expense reimbursements. Travel and expense is only as good as the people in other departments filling out their form with the correct receipt and turning it in, in a timely manner. If you look back at that sentence there are a few key words that can create big problems, “correct form” – “receipt” – “timely manner”. The point is someone could have the correct form with no receipts that are three months after the fact… that’s a problem.
What It Does
Now, as accountants, we are not victims. We have the ability to create rules and enforce those rules. However, no one likes denying an invoice or expense report, and people outside of accounting have other priorities so things slip through the cracks. What this does is it makes you, the accountant, the bad guy and it puts departments in an us versus them posture.
Enough of That!
One of the big benefits of Accounts Payable Automation is making the software that runs automation the bad guy. Well, not really the bad guy, but as a mentor of mine once said; one of the great things about software is you can make it a disinterested third-party. A disinterested third-party is something that has authority but not emotion about a particular topic. We see this a lot in legal matters where an arbitrator is called in that has no ties to either side and helps make a decision. Even with an arbitrator they are still human so they can potentially be swayed by emotions (however I know some attorneys that have no emotions… I don’t even think they are human). The point here is that when you automate you are able (if done correctly) to shift the policing of a process onto software making it, essentially, the bad guy and it doesn’t care at all.
The effect here is people become more accountable for what they need to do. The outcomes are more black and white (no shades of gray) to where the system has no guilt and the accountant is out of the bad guy role. The best part, people outside of accounting will do more.
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