In the landscape of automation, software, processes and payments there is a new idea that is just starting to show real signs of its usefulness – Payment Automation.
There is a lot of “automation” out there
- Accounts Payable Automation
- Marketing Automation
- Facilities Automation
- Assembly Line Automation
- Engineering Automation
- Salesforce Automation
The Old Days
What they have in common is the idea that before automation, there were people who did manual tasks that were then replaced by some type of technology. Having worked with companies to automate their Account Payable process, I find there is a continual battle to help organizations understand that they have 8500+ hours out there waiting to be freed up. The rub with Accounts Payable Automation is if you don’t need the additional time, automation won’t work for your company.
Working with clients to automate their payment process hasn’t worked the same way. Within companies, especially mid-market companies, there is not a huge time savings or push to reallocate staff for the check cutting process, so traditional forms of justifying automation just don’t apply.
I have been thinking about this all wrong. I have been operating under the misconception that automation is only as good and the time, people and effort that it frees up. What if… just what if, Payment Automation’s value has nothing to do with time and everything to do with the money? With traditional automation, the time being freed up is on the labor side. With Payment Automation, the benefit doesn’t come in blocks of time, but real-time monetary decisions.
When a payment needs to be made in the traditional world, the accounting professional selects the voucher or entry in their accounting system and pushes that payment to the printer and it prints out a check. It’s an easy decision because there is only one option… paper! The reality, however, is there are many decisions that can be made, but just aren’t at the accountant’s fingertips. Unbeknownst to the accounting professional, the vendor may be able to take an ACH payment or a bank draft or even a credit card payment. That’s the key. Know what the vendor is interested in receiving.
What’s the 101?
Payment Automation is a platform that knows the interest and desire of how the vendor wants to receive payments. This interest and desire has a habit of changing on a frequent basis and is extremely difficult (based on electronic payment adoptions for mid-market companies) to manage vendor by vendor. The fix is a single common database that is shared by many paying companies and accessible on a transaction by transaction basis. The outcome is a single file of all the payments that need to be made, separated by vendor that hits the database to initially find all of the vendors that accept electronic payments. The rest of the payments are paper checks that the service cuts on the clients’ behalf.
Want to know more? 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
How about a children’s book? The Princess and the Paper – click here to buy