A decade ago, the idea that an AP operation could be effective and efficient in supporting strategic business objectives while working as a key collaborator with both internal stakeholders and external suppliers may not have been impossible, per se, but it was highly unlikely. Today, that level of performance is more than possible. In fact, in Ardent Partners’ most recent State of ePayables market research, the group representing the top 20% of performers (defined by Ardent as the Best-in-Class) have realized this potential. As a group, these top performers are starting to unlock the strategic value of AP, as well as the efficiencies that can be gained from increased automation.
Enterprises with their eyes on delivering significant strategic value would do well to follow in the footsteps of Best-on-Class organizations. Standing on the shoulders of these “giants” allows other enterprises to understand what needs to be done (and how it should be done) to accomplish their goals. Ardent Partners has defined the key capabilities, strategies, and solutions that Best-in-Class AP teams utilize in their continuing transformation efforts. And these Best-in-Class AP organizations provide an instructive example, showcasing for other enterprises the results that are possible by investing in AP transformation.
For AP to make itself over and achieve a successful digital transformation, it needs to expand beyond the basics of the function and begin to augment the more strategic activity to which it is already linked. Invoice-processing, payment management, and data collection are all critical pieces of accounts payable; however, these activities alone are not enough to propel AP to the next level of performance. Most, if not all, stakeholders have historically expected little out of the function beyond being a low-cost operation that can process invoices efficiently and resolve critical issues (such as exceptions) adeptly. With the perception changing around AP, the “makeover” for the function is contingent on getting beyond the basics and into more value-adding territory.
Beyond transactional efficiency, many AP units have the opportunity to serve as a ‘hub of information’ for other stakeholders across the organization, supplying insights and knowledge that can arm key decision-makers. AP sits on a goldmine of information, including data held across thousands (or tens of thousands) of invoices and supplier payments. This data, when transformed into real, actionable intelligence, provides a fantastic link to internal stakeholders, external partners/suppliers, and key business executives like the Chief Financial Officer (CFO), and can provide significant strategic value to an organization while helping to raise the perception and appreciation for the AP function.
