- CFOs and finance executives are eager to digitize processes and reduce AP costs.
- Accounts Payable automation allows organizations to achieve key metrics of success and overcome the limitations of manual processes.
- Not quite convinced? We've gathered 10 statistics showing how automation has the power to transform the accounts payable function.
As humans, we often avoid change for as long as possible. The comfort and familiarity of the status quo make it easy to simply do things the way we've always done them — in our personal lives and in the workplace.
But think of the tools you consider essential in your daily life, from your smartphone to your air fryer. You may not have always had them, but they make your life easier — and now, you wouldn't trade them.
For finance teams, AP automation technology is one such tool — offering savings, improved productivity and risk reduction benefits that businesses can't afford to go without.
Featured Resource: Accounts Payable: How to track, benchmark, and improve your financial metrics
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10 statistics on the power of AP automation
These 10 statistics show how AP aligns with business success — and how automation can further empower the AP function. They highlight finance executives' most pressing priorities, the measurable drawbacks of manual processes and the major improvements that come with AP automation.
1. The International Monetary Fund predicts low economic growth over the next 5 years
While the economy continues its slow but steady recovery, the International Monetary Fund states that the economic growth rate five years from now will be around 3.1%, a figure that they note is the lowest in decades.
That means that, while the economy seems likely to achieve a soft landing and avoid a recession, financial growth is likely to remain a challenge. Companies will need to take advantage of every possible avenue that can decrease costs, optimize cash flow, and generate revenue.
AP automation offers all three, helping organizations cut the costs of invoice processing, optimize cash flow with AI-assisted insights and reporting, and even create revenue by helping AP teams capture early payment discounts and rebates.
2. 40% of transactions are still made by manual check—the least cost-effective form of payment.
While AP processes offer several areas to cut costs, close to half of finance leaders point to invoice processing as a top priority. Manual invoicing costs range from the hard costs of postage and paper to soft factors, such as time wasted by approval delays.
Though the drawbacks of these outdated AP methods are well known, paper checks still make up 40% of transactions — leaving plenty of opportunity for organizations to modernize their workflows.
3. 76% of CFOs surveyed cited digitization of finance processes as a key factor in their success.
Using physical documents for invoices and other AP paperwork isn't just more costly. It also leaves organizations more vulnerable to fraud, which can cause drastic damage to the health of a business should the worst happen.
What's more, physical documents are easily lost or damaged, they can be unwieldy to manage (think filing cabinets filled with invoices and purchase orders) and they're unfriendly to remote work. It's no wonder that 86% of CFOs are eager for AP digitization — and, in fact, view it as central to the success of their organizations.
4. 96% of employees say that they are dissatisfied with the tools they've been equipped with.
The vast majority of employees say that they are overburdened at work, and that they are not being supplied with the appropriate tools to successfully complete their tasks. These workers want their employer to invest in tools that will make their lives easier — not because they're lazy, but for the opposite reason.
Potential hires want automation to help streamline the repetitive tasks that can all too easily fill their days. That way, they can spend their time on more interesting and challenging work that drives value for the organization — rather than being bogged down by manual tasks.
AP is no exception. Accountants know the burnout that comes with an overabundance of tedious manual tasks like data entry. With the help of AP automation, organizations can equip their finance teams to simplify manual processes and spend their time on higher-value activities. This leads to greater employee satisfaction and a more productive business.
5. 1/3 of accountants admit they make at least a few financial errors every week due to capacity constraints.
Data entry errors, misfiling, and other mistakes can wreak havoc on your AP process. And roughly 33% of accountants admit making mistakes like this multiple times a week. 7.5% of all documents get lost and another 3% is misfiled. These statistics demonstrate one of the clearest issues with physical documents: the inefficiencies they present.
When AP teams must track down one out of every 10 of the documents they need, they're forced to waste valuable time that could've been spent on other essential functions. These wild goose chases are entirely preventable with the help of AP automation. When simple data entry errors occur, time has to be wasted identifying and correcting the mistakes. Digitized documents are much harder to misplace, helping teams stay organized and efficient. Automation and digitization also cut down on keying errors.
6. 76% of office workers spend up to three hours per day on data entry.
While some workers might find themselves enthralled by the prospect of hours of tedious data entry, these happy few are the exception rather than the rule.
Data entry plagues AP teams, and the task is even more burdensome because they have to enter data into multiple sources. Not only is manual data unpleasant and unnecessarily time-consuming — it's also error-prone. But this state of AP affairs doesn't have to continue.
7. 95% of companies who have adopted automation state that it streamlined processes like data entry.
By automatically capturing invoice details from descriptions to unit costs and quantities, automation dramatically cuts manual data entry for AP teams and minimizes human error.
The power of invoice automation extends to approval processes, which organizations can customize and route based on their unique needs. Automation also simplifies the process of searching for invoices. With Quadient AP automation, you simply type in the details of the invoice you need and the system will do the work for you.
8. 84% of companies who have fully automated their AP report increased cash flow and savings
The cost of processing a single paper invoice is a drop in the bucket for most organizations, but a steady drip can fill a bucket in no time — leading to spiraling costs
AP automation slashes the cost of a single invoice by 80% or more. For companies that process around 500 invoices each month, this means an annual savings of between $60,000 and $70,000. Whether your company is in a season of growth or budget cuts, those cost savings go a long way toward shoring up the health of the business.
9. Process automation is expected to result in 20% reduction of operational costs for businesses
Imagine how much your finance team could accomplish when AP automation streamlines repetitive manual processes like invoice validation and approval correspondence. Studies have found that process automation is estimated to reduce operating costs for organizations by approximately 20%.
Not only will your team members be able to focus on higher-value activities, but they'll also be able to say goodbye to overtime spent keying in invoices in favor of a more balanced and less burnt-out life.
10. AP automation can save your organization more than 70% of the time spent on accounts payable.
With manual methods, finance teams can typically process around five invoices per hour.
Through the power of AP automation, this number jumps to 30 invoices per hour. This dramatic increase in productivity means your organization can save between 70% and 80% of the time typically spent on AP activities.
Transform your business with AP automation
If you're ready to reduce costs and improve AP workflows from end to end, Quadient AP is here to help.
Automate invoices and streamline processes for expenses, payments, and purchase orders for a more productive and profitable business.
Featured Resource: Accounts Payable: How to track, benchmark, and improve your financial metrics
