Q: Which trends in finance are most impacting SAP accounts payable environments today? A: Three trends are fundamentally reshaping accounts payable processes across all businesses:

#1: Cloud DeploymentThe first trend is that more businesses are moving invoice processing to the cloud. Businesses are embracing cloud computing as a way to automate their operations without the up-front capital expense, in-house maintenance, software and hardware requirements, or risk of traditional on premise software. Implementing a cloud-based solution also enables businesses to extend the value of their ERP investments more quickly than in the past. Cloud-based accounts payable solutions deliver the same features and functionality of on premise software, and can be customized to a user’s needs. For instance, cloud-based solutions provide users with the ability to perform payables functions such as invoice scanning, data capture, validation and approval. Cloud-based invoice processing solutions also address the challenge of remote work. And these cloud-based solutions can be integrated with existing on premise ERP solutions, such as those from SAP, creating a hybrid operations environment. The emergence of cloud-

based invoice processing solutions provides another deployment option for mid-sized users of SAP ERP platforms. It is for this reason that one-third of businesses will have a cloud-based invoice processing solution within two years, IFO says. #2: Visibility into the BusinessThe second trend is that businesses are automating accounts payable processes to facilitate real-time decision-making. Today’s increasingly competitive global business environment requires businesses to make strategic and tactical decisions faster than ever. This dynamic requires more precision and efficiency in how decision-makers access and manage financial information. In fact:

By tightly integrating an automated invoice processing solution with an ERP platform, decision-makers achieve a 360-degree view of their operational and financial data, including: • Operational metrics• Aggregated data for cash forecasting and working capital management• Corporate spending and compliance with supplier contracts• Budget variance analysis and expense analysis by vendor

The enhanced visibility that results from the integration of an automated accounts payable platform with SAP helps businesses streamline invoice processing through the automatic validation of invoices against ERP data, faster resolution of exceptions, and streamlined training of front-line users.

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Accounts Payable Automation in SAP Environments3 Questions for an Industry Analyst

Mark BrousseauMark Brousseau, editor of special projects for the Institute of Finance & Management, discusses how accounts payable automation addresses the most pressing business challenges SAP users face.

40 percent of businesses surveyed by Ardent Partners said that improving accounts payable reporting and analytics is their top priority.

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Enhanced visibility also helps businesses control Cash Conversion Cycles, Days Payables Outstanding and Days Sales Outstanding, more easily aggregate spend calculations, more quickly identify budget variances or maverick spending, and gain leverage for contract negotiations.

#3: Intelligent Data CaptureThe third trend is that more accounts payable departments are deploying intelligent data capture solutions to automate the import, extraction, validation, routing, and archival of data from invoices and other accounts payable documents. This technology should not be confused with basic document scanning. Intelligent data capture solutions import and classify paper and electronic documents from any delivery stream (e.g. mail, fax, email), extract header and line-item data based on preconfigured business rules, validate the data, match and link all documents related to a specific transaction, and seamlessly post approved invoices to SAP or any ERP or general ledger system. Invoices that require approval are automatically routed based on defined rules. These capabilities enable accounts payable departments that use SAP to reduce transaction costs, accelerate the delivery of usable data to SAP, reduce invoice approval cycle times, and decrease errors.

Q: What impact are these trends having on SAP users?

A: The trends in accounts payable automation will have big ramifications in the payback businesses receive from their ERP investments. New technologies, changing business needs, and tight capital budgets are bringing rise to what Gartner calls the postmodern ERP: an ERP strategy that integrates existing investments in an ERP with third-party operational business capabilities such as accounts payable automation. This approach offers greater agility and flexibility to satisfy business needs compared to monolithic ERP approaches that depend heavily on expensive customization. Many businesses already have migrated to an environment where third-party applications work in concert with an existing ERP platform, such as SAP. Integrating an invoice processing solution–such as a cloud-based solution that automates data capture, workflow processing, and cloud archival–with an SAP ERP platform complements the ERP to dramatically increase its business benefit. It also reduces the time, cost, risk, and complexity required for deploying applications. As a result, more accounts payable departments will integrate third-party applications with their SAP platform.

Q: What is the most important piece of advice for accounts payable leaders who use SAP?

A: Keep the strategic benefits of accounts payable technology in mind when developing a business case for automation. Accounts payable leaders are well aware that accounts payable solutions such as intelligent data capture deliver tremendous tactical benefits, particularly in terms of reducing costs (60 percent or more!), but technologies such as intelligent data capture also deliver huge strategic benefits across the enterprise, including: fewer errors, decreased warehouse charges, improved Days Payable Outstanding (DPO), better cash position, reduced borrowing, improved supplier relations, increased margins, and higher earnings per share. The real-time visibility provided by intelligent data capture, for example, enables businesses to manage their working capital with greater accuracy and control.

Automation also provides the visibility businesses need to capture more discounts, and maximize returns. Additionally, the technology helps ensure budget and contract compliance by allowing businesses to set rules for price and quantity tolerances during invoice processing. And automation ensures that businesses have ready access to the accurate and complete information they need for planning, forecasting, and decision-making. These benefits can have a major impact on a company’s bottom line:

So don’t sell the strategic benefits of accounts payable automation short!

Not surprisingly, 27 percent of businesses plan to deploy automated data capture and workflow for invoice approval, IOFM reports. Studies show that every day of DPO extension yields

more than $25 million in cash for a Fortune 500 company; every billion dollars of spend yields over $400,000 in discounts per month; and more than 50 percent of supplier financing yields more than 30 percent annualized rate of return.

About TIS

Top Image Systems™ (TIS™) helps businesses compete in the digital economy, where the customer journey begins, progresses and ends in an entirely digital environment. In finance, this means transforming paper-based, manual processes to end-to-end automated processes that work the way you do—on premise, in the cloud and via mobile—inside of SAP. © 2016. Top Image Systems. All rights reserved.