Introduction
Robotic Process Automation has proved its abilities and gained a lot of popularity in today's world. Automation of accounts payable (AP) routine is an effective solution for MSPs to make payments to suppliers in various forms such as checks, wire transfers, and other virtual payments. Automation involves more than simply making payments; it also verifies the account data before any money goes out. RPA speeds up the process of payment while reducing the chance of errors.
The main aim of automating such tasks that humans traditionally performed manually is optimization and productivity of the payment procedures, allowing AP to pay vendors accurately on time. It frees up the staff's time to focus on activities that improve the bottom line, which can be a complete game-changer for MSPs. Additionally, RPA can get financial reports, make forecasts and do an in-depth analysis.
Many employees from MSPs often feel that automating AP is not possible or is not worth the investment. Yet, studies have shown that 93% of payment procedures can benefit from the use of RPA.
An example of automating the AP process could include the complete financial picture of an MSP and make suggestions to ensure the company stays innovative and efficient, with the help of ElectroNeek's RPA platform offering customized end-to-end solutions.
Challenges Involved in the Accounts Payable Process
When MSPs plan to expand, AP is often not a top priority. Businesses need to understand that accounts payable is a vital function that ensures internal procedures are on track. For growing MSPs, there are many issues the AP department faces and are often insufficiently automated.
The AP team often encounters a high error rate by manually conducting the task, including failed transactions and late and delayed payments, which can take many days to correct. From the organization's viewpoint, not using RPA means little to no visibility. The accounts payable team often gets blamed for late payments and interest charges piling up for each account holder. They tend to react to invoices rather than focusing on end-to-end solutions and effective money management.
In addition, the manual process has too many steps, such as invoicing, verification, approval, and payment, often resulting in delays, mistakes, and inaccurate reporting. Hence, the AP departments of MSPs must use the right technology and provider to improve productivity and time management. ElectroNeek offers robust, customized solutions to match every MSPs' AP workflow needs.
Benefits of Using RPA in Accounts Payable
The primary drive for reassessing the AP workflow is to lower the invoice processing costs, improve and standardize the accounts payable procedures. RPA possesses enormous potential to transform the entire landscape of invoice processing as the AP activities have numerous manual and repeated tasks.
RPA plays a vital role for MSPs in automating AP and eliminating repetitive and lengthy low-value tasks like entering data. Furthermore, automation can make the process simple and beneficial for AP personnel.
Some of the advantages of RPA in AP for MSPs include:
1.Smoothly capture input and match invoice data of suppliers:
Manually, capturing and matching supplier data is done through data entry which is long, stressful, and prone to delays. RPA helps change the entire process effectively. For example, RPA can replicate the data entry process and match it to purchase orders accurately with no delays when a digital invoice is received.
2. Efficient Compliance:
A considerable burden for AP staff is creating purchase orders (PO) that often delay the entire workflow, and receipts of services get left unconfirmed. RPA lets MSPs get an automatic alert to the PO creator when something is missing or forgotten to ensure delays get kept to a minimum.
3.Quick Account Reconciling:
Account book closure and reconciliation is a tiring and time-consuming process due to the involvement of inputs from the entire team. Here is where RPA deploys bots to automate data transfer, manage minor decision-making, and ensure everything is running smoothly with no inaccuracies. Additionally, it speeds up the process and reduces errors.
4. Easily Scalable:
RPA ensures the entire AP process is scalable and can be easily reused for various departments and locations. It offers a state of consistent growth in the accounts payable workload. For example, software bots can reassess and allocate busy queues customized to the needs of each MSP.
5. Better Supplier Relationships:
By offering speedy invoice approvals, RPA becomes vital in maintaining better relationships with suppliers. The chance of something going wrong with suppliers is minor.
Manually, the same process can delay payments without the supplier being in the loop about it, and the department may send the purchase amount again, thinking it got lost. Such a confusing nature of the procedure may lead organizations to pay the same invoice twice. Hence, RPA implementation provides a shorter invoice cycle and complete transparency not offered by any other option, especially premium vendors like ElectroNeek.
6. Less Expenditure:
MSPs can save on costs tremendously by adopting RPA to take over invoice data entry and other similar tasks previously outsourced or done manually. Furthermore, reducing the invoice lifestyle, RPA gives MSPs the competitive edge of getting more discounts from suppliers due to consistent early payments. Additionally, it allows the elimination of late penalties, which is relatively high in manual processes.
7. Enhancing Customer Satisfaction:
RPA can be deployed 365 days with no breaks in operation. The automated process working 24/7 allows MSPs to offer better customer service resulting in enhanced customer satisfaction, another competitive advantage over the intense competition in the current market.
8. Seamless Closing and Reporting of Finances:
RPA can reduce the need for manual copying and transcribing data by automating tax entries into financial tools such as Quickbooks. Hence, the AP department can report and close finances more accurately with no further hurdles or errors, making the entire process more efficient and accurate.
How much can RPA Automate in the Accounts Payable Workflows for MSPs?
After MSPs map out the AP processes that require the most repetitive and manual labor, they can begin automating using RPA bots. Top features such as OCR and Computer vision can convert unstructured data into structured data for automated processing. Almost every aspect of the AP process can adopt RPA, from capturing the invoice to payment and analytical reporting. However, the main areas where automation can make the most impact include:
1.Using E-invoices (removing manual data entry):
The starting point of the AP process for any MSP is receiving a vendor invoice for payment. It is the most critical step because if a mistake occurs where it can disrupt the entire process. Invoicing is a compound procedure with no standardized method for capture. An invoice can be recorded in numerous formats such as Jpegs, PDfs, emails, faxes, and even physical paper, making it time-consuming for employees to sort and scan.
Here is where ElectroNeek's OCR system can recognize and extract data from any image or even paper documents, and create editable versions resulting in high efficiency along with more precision than any other available option. The OCR invoice system can also flag and categorize critical data and expenses, making e-invoices the best option.
2. Seamless Approval Process:
AP's approval process is a significant point where errors as the responsibility change hands here. Approval is vital in verifying expenditure and management of the budget. Before making any payment, the vendor invoice must get routed to the correct personnel for payment approval.
Using an automated approach can ensure invoices are seamlessly routed to the responsible party for approval with no room for errors. For example, If an invoice for a new inventory comes in, it will be routed to the employee who initiated the purchase order. After that, it goes to the department head and the financial administrator for payment approval. Using RPA, each concerned person will have precise data and quickly complete the approval process with no data loss or time loss.
3. Automating Matching and Verification:
After paying for an invoice, it often doesn't end up matching what you ordered, which can be frustrating and confusing. Hence, matching and verification in the AP processes are crucial to ensure that every invoice is correct and your MSP pays for what is agreed to be delivered and the exact amount. Using RPA for matching and verification processes can help identify inconsistencies speedily regarding the total products, amount of money due, and the price for each item individually.
Invoice matching will again use OCR to search for an invoice and PO number to match data to verify the specific purchase gets made. Even if the process needs information from many supporting documents, RPA bots can gather all that data from a purchase transaction to provide all the correct details.
4.Combining a smart card and automation tools:
AP departments often don't prefer to spend on a card because it won't allow auto-categorization of information. Here is where smart cards are valuable; A smart card is a tool that helps users connect either through physical contact or a remote radio frequency to make a transaction. It also enables users to store particular data unique to that individual when they make a payment without the need for physical cash.
Above all, it allows for the automatic categorization of data without errors. In essence, it can record all the transaction data accurately, reducing the burden on the Accounts Payable team. It is almost like a convenient USB with maximum security.
Furthermore, smart cards can securely authenticate a specific user from third parties who want to access the card. For instance, entering a personal pin code completes the authentication process.
Smart cards partnered with automated expense management systems can hold all payments until due, ensuring cash remains longer with MSPs. Hence, providing the AP department a way to auto-categorize data, improve flexibility, and let cash flow seamlessly without any errors.
How Can ElectroNeek help?
ElectroNeek offers completely digitized automation facilitating day-to-day processing activities, making your MSP more productive. As an integrated platform, it provides the following primary advantages:
- Streamlines multiple activities under one workflow.
- Provides a guided system for alerts, notifications, and confirmations.
- Supports end-to-end compliance along with vendor compliance.
- Tracks many categories such as vendors, contracts, spend, and many more options.
- The interface is user-friendly and easy to use for MSPs.
ElectroNeek’s AP automation provides MSPs with a boost in productivity, reduces communication problems while allowing your company to meet strict deadlines and satisfy customers. Additionally, with ElectroNeek, there is no need to deal with hurdles like licensing and extensive coding, making it the best option for any MSPs AP department’s automation needs.
ElectroNeek is one of the most trusted accounting community vendors and has worked with top firms like Sage; and is a member of the AICPA accelerator. As a top vendor, the automation solutions available at ElectroNeek are limitless; it goes beyond just automating accounts payable operations to implementing RPA in any financial rule-based, repetitive procedures.
Conclusion
It is evident from the information provided above that RPA for the AP process can be the competitive edge that MSPs need. ElectroNeek being one of the best providers, can genuinely take your MSPs’ accounts payable workflow to the next level. If interested to know more, please get in touch with our team today!