It is with great pleasure that Ardent Partners announces the publication of its latest state of accounts payable (AP) research report—“ePayables 2015: Higher Ground.” Like the annual reports that came before it, the 2015 ePayables report focuses on the state of the AP function as well as assessing how AP teams leverage ePayables solutions to improve business results and offering up Best-in-Class metrics that allow readers to benchmark their own operations against top performers. (The report is available for download here, here, here, here, and here.)
AP’s Two-Year Goals – Make AP More Strategic
The accounts payable team sits in a prime position to become a central “hub” of excellence, insights, and intelligence for the average enterprise. In order for this to happen, however, consideration must be paid to a variety of different operational and functional aspects. One of the keenest is understanding how AP can fit into the wider enterprise’s long-term vision—AP can ill afford to continue along as a back-office unit, despite the reality that many executives still do not pay close attention to the function.
Many AP leaders recognize this, which is readily apparent from the 30% of ePayables 2015 survey respondents that noted transforming AP into a more strategic and agile business function is a goal for the next two years. In order to accomplish this particular aspiration, however, it is incumbent on AP leaders to first uncover the enterprise’s long-term ambitions. Only through finding the enterprise’s long-term goals, and aligning AP with them, can AP leaders take the first step on the road to making the function of more strategic importance.
That said, one of the best ways to transform AP into a function that adds strategic value is through addressing the visibility problems inherent in paper-based manual processes. AP sits atop extensive financial and operational data that can be leveraged in many areas, not least of which is in Treasury’s working capital optimization plans. AP can prove its strategic value to Treasury, and ostensibly to the wider enterprise, through providing insight into upcoming supplier payments. Similarly, visibility into invoice data can assist Procurement with tracking supplier performance. This is in addition to the efficiencies that can occur from taking focus off tactical activities in AP and focusing more energy and attention on how the function can operate with a more strategic aim.
Even though AP has historically operated as a back-office function, the department has significant potential to be of strategic importance to the wider enterprise. In order for this to happen, however, the AP team must migrate away from the tactical activities that it has traditionally focused on and shift attention to those actions that can drive strategic business value. Given that AP sits at the nexus of numerous operational and financial processes, making the function more strategic is a valuable goal to have—the only question now is finding the right executive and stakeholder support to actually make such a transition happen.
Whether you’re an AP or procurement professional, we’d love to have you attend our inaugural procurement executive summit, CPO Rising 2016, to be held at the Harvard Club of Boston in March. Details and registration are available here!