Mapping your current accounts payable (AP) processes is a crucial first step before implementing automation. This helps you understand the existing workflow, identify inefficiencies, and prepare for a smooth transition to an automated system. Here’s how to effectively map your current AP processes:
Identify Stakeholders
Identify all stakeholders involved in the AP process, including accounting staff, approvers, procurement teams, and vendors. Determine their roles and responsibilities in the current workflow.
Document Steps in the Process
Document each step involved in your current AP process from receipt of invoice to payment. This includes:
– Invoice Receipt: How invoices are received (mail, email, electronic submission).
– Data Entry: How invoice data is entered into your accounting or ERP system (manual entry, OCR technology).
– Invoice Approval: Workflow for approving invoices, including approval hierarchy and decision points.
– Payment Processing: How approved invoices are processed for payment, including scheduling and execution.
– Vendor Communication: Methods and frequency of communication with vendors regarding invoice status and payment.
Gather Input from Stakeholders
Conduct interviews or workshops with stakeholders to gather insights into their experiences, pain points, and suggestions for process improvement. Consider using process mapping tools or flowcharting techniques to visualize the workflow.
Document Variations and Exceptions
Identify any variations or exceptions in the AP process, such as rush payments, disputed invoices, or special handling requirements for certain vendors. Document how these are currently handled.
Map Approval Hierarchies
Map out approval hierarchies for different types of invoices (e.g., based on invoice amount, departmental budget, vendor relationship). Document who needs to approve invoices at each level and any escalation procedures for unresolved issues.
Review Compliance Requirements
Ensure that your current AP processes comply with internal policies, regulatory requirements, and industry standards. Document any compliance checks or controls currently in place.
Capture Metrics and KPIs
Identify key performance indicators (KPIs) currently used to measure AP process performance, such as cycle times, error rates, and invoice aging. Document current metrics to establish a baseline for future improvements.
Identify Integration Points
Identify integration points with other systems or departments (e.g., procurement, finance) that are critical for invoice processing. Document how data flows between these systems and any dependencies.
Validate and Verify
Validate the documented process maps with stakeholders to ensure accuracy and completeness. Address any discrepancies or gaps in understanding before proceeding to automation.
Prepare for Automation
Based on your documented AP processes, identify opportunities for automation to streamline workflows, reduce manual effort, and improve accuracy. Prioritize areas where automation can deliver the most significant benefits.
By thoroughly mapping your current AP processes, you gain a comprehensive understanding of how invoices are currently processed within your organization. This foundation will guide you in effectively implementing AP automation, optimizing workflows, and achieving operational efficiencies in invoice processing.
