The needs of an AP department can change quickly, and being able to adapt is key to sustaining efficiency and productivity, and avoiding backlogs. This especially applies to the procure-to-pay process. To keep this process running smoothly and to avoid errors, it’s important to be open to change and willing to optimise as needed. Here are a few ways you can do this:
1) Identify Inefficient Processes
An efficient procure-to-pay process can save a department time and money, while an inefficient process can lead to wasted resources and dissatisfied customers. There are several ways to identify inefficient processes. One way is to assess the average time it takes to complete each step in the procure-to-pay process. If certain steps are taking significantly longer than others, or employees have expressed frustration about particular tasks, it may be an indication that the function is not optimised.
2) Consolidate Your Supplier Lists
While supplier diversity is essential for maintaining a competitive edge, it can also lead to inefficiencies in the procure-to-pay process. For example, manually managing a large number of small supplier invoices can be time-consuming and error prone. Consolidating your supplier list using an automated software solution can simplify and streamline the procure-to-pay process, saving you time and money.
3) Educate Your Workforce
By providing targeted training on topics such as supplier selection, invoice consolidation, contract management and invoice processing, you can help individual colleagues and line reports avoid common mistakes and ensure that the process is as efficient as possible. Team-based training and role-play is also a great way to ensure that everyone is on the same page and that processes are followed correctly.
4) Establishing Clear Expectations For Your Supply Base
By having a good understanding of what your suppliers can and can’t do, you can avoid potential problems further down the line. For example, if you know that one of your suppliers is unable to meet a tight deadline, you can plan accordingly and source goods from another supplier. Similarly, if you are aware of any quality issues with a particular supplier, you can put in place measures to ensure that the goods you receive meet your standards.
5) Accelerate Your Cycle Time With an Automated System
An automated system can help you accelerate procure-to-pay cycle time by streamlining the process and eliminating manual tasks. This can free up valuable resources that can be used elsewhere in the business. In addition, automating the process can help to improve accuracy by eliminating paper-based processes and ensuring that data is entered correctly. Finally, automating the process can increase transparency, making it easier to identify potential problems at an earlier stage and avoid bottlenecks.
6) Standardise Your Procurement Processes
By standardising your procurement processes, you can optimise the procure-to-pay process and enjoy several benefits. Perhaps most importantly, you’ll be able to take advantage of economies of scale and get better deals from suppliers when you purchase in larger quantities. In addition, standardising your procurement process can help you to better manage risk and ensure compliance with regulatory requirements.
At Cogent Consulting, we offer a range of AP support solutions to help streamline manual processes, boost productivity, and improve efficiency. To find out more, please get in touch today.