Transcript of a BriefingsDirect discussion on the changing role and impact of accounts payable as a strategic business force.
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Dana Gardner: Hi, this is
Dana Gardner, Principal Analyst at
Interarbor Solutions, and you're listening to
BriefingsDirect.
Our business innovation thought leadership discussion today focuses on the changing role and impact of
accounts payable (AP) as a strat
egic
business force. We’ll explore how intelligent AP is rapidly
transforming by better managing exceptions, adopting fuller automation,
and implementing end-to-end processes that leverage connected business
networks.
As the so-called digital enterprise adapts
to a world of increased collaboration, digital transactions, and
e-payables management -- AP is needing to adapt in 2016.
To learn more about the future of AP as a focal point of automated business services we are joined by
Andrew Bartolini, Chief Research Officer at
Ardent Partners in Boston. Welcome, Andrew.
Andrew Bartolini: Thanks for having me. Great to
speak to you again, Dana.
Gardner: Good to have you with us. We are also here with
Drew Hofler, Senior Director of Marketing at
SAP Ariba. Welcome, Drew.
Drew Hofler: Thank you, Dana. Good to be here.
Gardner:
Drew, let’s look at the arrival of 2016. We have more things going on
digitally, we have a need to improve efficiency, and AP has been
shifting -- but how will 2016 make a difference? What should we expect
in terms of AP elevating its role in the enterprise?
Hofler:
AP is one of those areas that everybody looks at, first and foremost,
as a cost center. So when AP looks at what they can do better, they've
typically thought about efficiency and cost savings first. That’s the
plus side of the cost center as saving money by spending less.
 |
| Hofler |
But what we've been seeing happening over the last
year or so, and what will accelerate in 2016, is that AP begins to move
more from just a cost saving and efficiency focus to value creation. And
this is where they sit in the hub of one of the three critical elements
of working capital -- inventory, receivables and payables -- and AP
sits squarely on that last one.
And they have
influence over that which affects the company's working capital. AP has
become so very important for companies by creating the efficiencies in
the invoice process, it opens up opportunities, and they're going to be
able to affect a company’s working capital for the positive going
forward. That’s going to grow as they move beyond just the automation
that is the foundation to then seeing the opportunities that come out of
that.
Gardner: Andrew, do you see AP also as a
digital hub, growing in its role and influence and being able to increase its value beyond cost efficiency into these
other higher innovation levels or strategic levels of benefit?
Tracking trends
Bartolini:
Yes, absolutely. I've been
researching and working in this space for 17 years, doing significant market research over the last 11 years. So
I've been tracking the trends and the ebbs and flows of relative
interest and investment in AP.
What
we've seen in 2015 in some of our most recent research is that there
has been a broader focus or a shift away from viewing the AP opportunity
as an efficiency one or solely an efficiency one. Let’s automate. Let’s
reduce our costs in processing invoices. Let’s reduce our costs in
payments.
But what we saw this year for the first time
in our research was that the top area of focus, the top business
pressure that’s driving investments in AP transformation was the need to
get better visibility into all the valuable information that comes
across the AP departments or through the AP operation, both on the
invoice and the payment side.
That begins to change
the conversation. We talked about the evolution of AP moving from a
strictly back-office siloed department to an increasing point of
collaboration with procurement at the
purchase-to-pay (P2P)
process, with treasury, from a cash-management perspective. Now, we see
it starting to move and becoming a true intelligence hub, and that’s
where we've seen some momentum. There’s a lot of wind in the sails for
AP, really pushing that forward in 2016 and beyond.
Gardner: Andrew, what’s driving this? Is this the technology that's now allowing that data?
Bartolini:
There are a couple of factors underlying this movement. The first is
taking the broader perspective within business as a whole. Businesses
can no longer allow distinct business functions to operate within silos.
They need everybody on the same team, rowing in the same direction.
That has forced greater collaboration.
That’s
something that we've seen more broadly between procurement and finance
over the past couple of years, specifically with the role of the CPO and
the CFO. A majority of organizations see a very strong level of
collaboration within those two job roles and within their departments as
a whole.
That has opened up larger opportunities for
AP, which is a more tactical function as it relates to procurement, but
by bringing the two groups together, you now have shared resources and
shared focus on improving the entire source-to-settle process.
That
relationship has driven greater interest, because the opportunities are
fantastic for procurement to leverage the value of a more efficient AP
process and to be able to see the information that’s there.
As
Drew mentioned, by becoming more efficient on the front end of the AP
process, organizations are doing a better job in reducing the amount of
paper that’s coming in through the front door. They're processing their
invoices faster. That's opening up opportunities on the back-end, on the
payment side.
So, you have a confluence of those
factors and you see newer solutions in the marketplace as well that are
really changing the view that AP departments have of what defines a
transformation. They're thinking more holistically across the entirety
of the AP process, from invoice receipt, all the way through payment and
settlement.
Allowing for variables
Gardner:
Drew, it seems that over history, once a contract is closed the terms
remain fairly rigid, and then there is a simple fulfillment aspect to
it. But it sounds like -- as we get more visibility, as we get
digitized, and we can automate -- we can handle exceptions better and
allow for more variables.
I've heard instances where
the terms can be adjusted, that market forces can provide for ways in
which a deal gets amended as an ongoing basis, whether it's in terms of
payment, whether perhaps there are other ancillary issues. Is that what
we are seeing, that the digital transformation is giving us more
opportunity to be flexible, and is that then elevating the role of the
AP organization?
Hofler: You make a couple of
good points there, and it really springs from what Andrew just said
about not having to silo or not staying in that siloed place where AP
and procurement are separate or the processes are separate, because what
companies have realized, particularly as the digital age has made it
possible, is that the procure-to-pay process, the source-to-settle
process, is a fundamentally connected one.
Over the
years they've operated very disconnectedly, with hand-offs, where
procurement does its thing, writes a contract and then hands it off once
the
purchase order (PO) goes out the door, and then AP takes up the process from there. But in that, there are a lot of disconnects.
What companies have realized, particularly as the digital age has made
it possible, is that the procure-to-pay process, the source-to-settle
process, is a fundamentally connected one.
When
you're able to bring networked systems together to bring visibility
across that entire process, now you have the AP group acting in a more
strategic manner to deliver value by acting as the value-capture group.
For
example, prior to this age that we live in now, a contract would be
written, it would have specific terms for specific items and specific
prices for specific
SKUs,
and maybe some volume discounts. AP had no idea about that, because
these contracts would get signed and they get put in a file cabinet or
stuck in a PDF file somewhere, and the AP had no idea. So they went off
of the invoice that came in.
This is how an entire
industry about post-audit recovery came about, to go after the fact and
try to claw back over-payment, because there's no visibility in AP to
what procurement did.
By bringing these together in a
system, on a network, you're able to automatically capture those
savings, because AP now has visibility into what’s happening inside of
that contract, and can insure on an automated basis that they are paying
the right amount. So, it becomes not just a buy-right thing from the
procurement side, but a pay-right thing as well, a buy- and pay-right
tied together.
But that's your point about terms. Yes,
you have certain terms tied into that contract, but again, that's set at
the beginning of a relationship with a supplier. There are lots of
opportunities that come up when everybody has visibility into what's
going on, into an early-approved invoice for example.
Opportunities for collaboration
There
are lots of opportunities that arise for collaboration where maybe the
situation has changed a little bit. Maybe a supplier, instead of being
paid in 45 days, now would very much like to be paid in five days,
because they have payroll ahead or they have an equipment purchase to
make, and they want to accelerate their cash flow.
In a
disconnected world, you can't account for that. But in a networked
world, where there is visibility, I like to say that it's the confluence
of visibility, opportunity, and capability where all parties have
visibility into the opportunity created by efficiencies with that
earlier approved invoice. Then, there's the capability inside the system
to simply click a button and accelerate that cash flow or modify those
terms on that contract, in those payment terms.
So this
idea of P2P being a linked value chain and the digital technology of
today can bring those together so that there are no barriers to that
information flow and that creates all sorts of opportunities for all
parties involved.
Gardner: Andrew, we're having a
common denominator here of visibility, the visibility is what allows
for a lot of these efficiencies and innovation values to occur, where
does that visibility come from, where does the data get generated, how
is it shared, and how do we further reduce the silos through the free
flow of data analysis and information?
Bartolini:
Visibility at the core starts with automation tools that automate
processes. If we're looking at the P2P process, you're looking at an
eProcurement system. You can go back to where it starts, from sourcing
and contracting. If you have contract visibility or at least visibility
into your header-level information, you begin to have an understanding
of what, in fact, the relationship is and what relationships you have as
an organization, who are your preferred suppliers, who are your
strategic suppliers.
Visibility at the core starts with automation tools that automate processes.
As you start to drill down, if you have the capabilities to capture things like payment terms and
service-level agreements (SLAs).
That information begins to provide a more robust view of the
relationship that can then be more strategically managed from a
procurement perspective, and then really sets up the operational
procurement side.
If you have an eProcurement system,
you're able to generate purchase orders against those contracts and
you're ensuring that before the purchase order is even sent to the
supplier, the pricing and the terms are correct.
That
cascades over onto the AP automation side. We use the term "ePayables"
very broadly to describe AP automation solutions. When you have an
eProcurement and an ePayables solution connecting, you begin to have
greater visibility within the enterprise for the entirety of the
relationship and the entirety of the transaction.
On
the flip side, where we haven't gotten to the value proposition for
suppliers who really view their customer relationship as a single one,
what often happens is they have multiple relationships within that
customer that really aren't needed. They negotiate a contract, they have
their internal customer, and then they are dealing with maybe a
procurement department and then trying to then figure out who they are
dealing with on the AP side.
When you’ve got visibility
that can be shared with trading partners, you get extraordinarily
greater value out of the entire thing, and you streamline relationships
and you're able to focus on the more important aspects of those
relationships. But to the original question, visibility starts and ends
with technology.
Centralizing procurement
Gardner:
We're also seeing the trend of larger organizations centralizing
procurement, sometimes placing it, if it's a global organization, in
another country instead of having it in multiple countries or multiple
markets. It becomes consolidated and automated. How does that fit in,
Drew?
Hofler: We see definitely a move toward a
shared service or a global process ownership type of thing, where they
want to take the variability out of the different geographies or
different business units doing what is essentially a standardized
process, or they want to make that standardized.
We
definitely see the movement in that, and it's both a business desire and
goal to remove the variability, but it's something that's enabled by
the technology that we have today in business networks, in centralized
systems, that can tie all of this together. Now you have business units
operating across the world, but tapping in all of that information,
tapping in, getting all the invoices to come into one place through a
network. Those business units can see that. Those business units have
access at a controlled pace to the information that they need inside of
those systems as well.
On the procurement side, if you're sourcing globally, you can have different centers of excellence.
For
the ability to connect the data to everybody, to turn that data not
just from an information but to intelligence, getting it in front of the
right people at the right time and the right process, the business
networks really, really help to drive that. Having that centralized
network hub where everybody can connect at the point of the process that
they need really helps drive or enable the movement towards shared
service and centralized AP procurement.
Bartolini:
Anyone would be hard-pressed to make a case that you should have a
decentralized AP operation. That doesn't mean that you can't have staff
that are geographically dispersed, but there's no reason why that should
exist.
On the procurement side, if you're sourcing
globally, you can have different centers of excellence. Again, you want
to have a more centralized view into visibility and to be utilizing the
same systems and processes. On the AP side, centralization also helps
from the standpoint that you begin to get a better sense of what
resources are being applied in the AP process today. It also becomes
easier to centralize or to gain budgets for investment in tools that can
drive efficiency, visibility, and all the things we've just been
talking about.
Gardner: Another thread that I’m
hearing in our conversation is that technology needs to be exploited,
visibility gained, and automation made possible. Then, centralization
can become a huge benefit from all of that. But none of this is possible
if we don't go all digital. If we don't get off of manual processes and
get off of paper. What do you think is going to be the ratio, if you
will, of a paper approach that's left? Are we finally going to pull the
last paper invoice out, or the last payment that's manual? Where are we,
Drew, when it comes to making that full transition to digital? It seems
to me an overwhelmingly beneficial direction.
Still using paper
Hofler:
I've been in the payment space for about 20 years and the payable space
for the last 10, and in payment, there have been predictions in that
space that we would get rid of the paper check completely. Gosh, for the
last 20 years everybody is saying it's going to happen, but it hasn't.
It's still about 50 percent paper checks.
So I'm not
going to make a prediction that paper is going to go away, but most
definitely, companies need to deal with and move toward electronic data.
Even if it's paper based, a lot of companies are moving toward getting
the data in electronically, but a lot of them say, "Well, I get my paper
scanned, I've sent it to a scanning service or whatever, and I get it
in PDF or electronic data form."
That's fine and
that's one step along the process, but companies are realizing that
there's a limitation in that. When you do that, you're simply getting
the data that was on that paper source document faster. If that paper
source document data is garbage, and that's what creates exceptions,
then you're just getting the exceptions quicker, and that doesn't really
help the process, that doesn't really solve the true issue of making
sure you're not only getting the data faster, but that you get it in
clean and that you get it in better.
This is where companies need to move toward full electronic invoicing, where it starts its life as an electronic invoice.
This
is where companies need to move toward full electronic invoicing, where
it starts its life as an electronic invoice, so that a supplier can
submit it and have it run through business rules electronically before
it even gets the AP. They can identify the exceptions and turn it around
to the supplier and have them correct it, all in a very quick and
automated fashion, so that by the time AP gets it it's 98 percent
exception free or straight-through processing.
Companies
are going to realize that just transforming a paper source document
into an electronic form has had value in the past, but its value is
quickly running out, and they need to move toward true electronic.
How
far we are going to get along that path? Well, that’s a big prediction
to make, but I think we'll move along way down that path. Companies
definitely need to recognize, and are starting to recognize, that they
need to deal with native electronic data in order to truly gain value,
efficiency, and intelligence and be able to leverage that into other
opportunities.
Gardner: We mentioned exception
handling, exception management, making that easier, better, faster. It
strikes me that exception management is really a means to a greater end,
and the greater end is general flexibility -- even looking at things as
markets, as auctions, where there's variability and a fit-for-purpose
kind of mentality can come in.
So am I off in some
pie-in-the-sky direction, Andrew? Or when we think about the ability to
do exception management, are we really opening up the opportunity to do
even more interesting, innovative things with business transactions?
Reduction of exceptions
Bartolini:
No, I don’t think it’s pie in the sky. One of our recent surveys of
about 200 or so AP finance, and P2P professionals, a question was asked,
what’s the number one game changer that will get your AP operation to
the next level of performance? And the answer that came in loud and
clear was the reduction of exceptions and the ability to perform
root-cause analysis in a much more significant way.
So
it’s a fundamental problem, and the opportunity is for a majority of
things. About two-thirds of organizations feel that if they could handle
this issue better, if they could reduce that number, they would be
operating at a significantly higher level.
We haven’t
really talked too much about the suppliers in this equation, but a lot
of business focus and a lot of the themes in our research this year and
into 2016 has been focused on agility and the need for organizations to
become more adept and responsive to market shifts and changes.
Part
of that is getting better alignment with the strategic suppliers that
are going to drive more value and that are having a greater impact on
the company's own products and services and ultimately their results.
When that noise in the relationship is reduced it allows organizations
to focus on goals and objectives and to invest more in the strategic
elements of the relationship.
So, you look at
something like exceptions that are problematic for both sides of the
trading-partner equation, when you start to reduce those, when you start
to eliminate a lot of the friction that is built in, certainly around
the manual P2P process, but can exist even in an automated environment.
When that noise in the relationship is reduced it allows organizations
to focus on goals and objectives and to invest more in the strategic
elements of the relationship.
Gardner: Drew,
anything to add to that, particularly when you consider that the pool of
suppliers is, in a sense, growing when we look at contingent workers,
when we look at different types of suppliers as smaller firms, perhaps
located at a much greater geographic distance than in the past. We have
more open markets as a result of connected business networks. How do you
see that panning out in 2016?
Hofler: Yeah,
there's definitely a growth in that. There's a pretty good stat that
shows that a much larger portion of a company's workforce is not bound
to that company, and it's a temporary, it's a contingent workforce, it's
services that are from contractors that aren't necessarily tied to
them.
The need to handle that, particularly the churn
that happens with that, the broader number of contractors that you might
have with that, the variability in the services that are asked for,
that are needed, all of this adds layers of complexity, potentially, to
AP, and to procurement as well. We're focused more on AP here, but it
adds layers of complexity in managing that and approving that, and as a
result, can add a significant number of exceptions.
So,
while you're operating your business in a way that is a little more
fitting in today’s world, you're also adding a lot of complexity and
exceptions to the process, unless you’ve got a way to automatically
build in the ability to define the invoice and to identify the
exceptions so that these various suppliers who are much smaller and
geographically dispersed can submit online or can submit electronically
and can do so in a way that's standardized, even across this large
group.
Catching exceptions
The
exceptions can be caught right away, for example, field services. If
there's a service sheet form that was put out by procurement to hire
somebody to go fix an oil well, and they get out to the oil well and
there’s more to be done than what was on that, they have to get approval
for that. To have the ability to get that approval online,
automatically, through a mobile device, and have it tied directly into
the invoice, and have the invoice close that eliminates all those
potential breakpoints of finally getting that invoice in and getting the
exceptions dealt with and approved.
Exceptions to me
aren't just a matter of, "Gosh, they're hard to do." They're something
we want to get rid of. But exceptions are simply the barrier to the
opportunity that comes when you can get that invoice moved through and
approved right away, not necessarily a matter of paying the invoice
faster from the payer’s perspective, but the ability to have it approved
and ready to go right away, so that you have options, and so that the
supplier has options potentially for cash flow and things like that.
Exceptions
become something that we have to eliminate in order to get to that
opportunity, but without the platform to do that, to your point, the
dispersed workforce, and the increasing contractors, they can make it
even harder than it is or than it has been.
Gardner:
When we look at the payoffs from doing things better using AP
intelligence and technology, we are not just looking at efficiency for
its own sake. I think you're opening up more opportunity, as you put it,
to the larger business.
If procurement and accounts payable can adjust and react rapidly to
complexity, to exceptions, to new ways of doing business -- this is a
powerful tool to the business at large.
If
procurement and accounts payable can adjust and react rapidly to
complexity, to exceptions, to new ways of doing business -- this is a
powerful tool to the business at large. They can go at markets
differently. They can acquire goods and services across a wider
portfolio of choices, a wider marketplace, and therefore be able to
perhaps get things easier, faster, cheaper.
Let’s look
at this idea of non-tangible payoffs that elevates the value of AP to
being a sophisticated intelligent operation. Let's start with Andrew.
What are some of the intangibles -- if we do all the above that we have
mentioned well – how does this empower the organization in ways that we
haven't seen before?
Bartolini: That’s a great
question and it gets back to the one point I was just making about
agility. If you were to argue that we're operating in an age of
innovation, where globalization and the level of competition, and the
speed of business in general has really accelerated the time frames that
organizations must react -- I think this is happening at a much faster
pace.
You can see that in areas like the consumer
electronics market, and in all industries, product lifecycles are
shortening, and so the windows of opportunity to maximize sales and
revenues in the marketplace are much shorter as well.
Things
are happening at a much faster clip and in tighter time frames. This has
created a much greater reliance upon your suppliers and upon your
supply chain. And so having visibility across the P2P process, across
the source-to-settle process, and having much tighter relationships with
your strategic suppliers ultimately positions the organization to
become much more agile and much more competitive. And that's the value
dividend that's created from a more streamlined P2P process.
It’s
being able to more fully optimize the relationships that you have with
your suppliers, and it's being able to make decisions and shifts in a
much faster way than in the past, and that's not just from the sourcing
side, that carries all the way through to the payment side as well.
Business agility
Gardner: Drew, when we think about the strategic role of AP -- of providing business agility -- you can’t get more strategic than that.
Hofler:
No, that's right. AP particularly can become the source of much of that
strategic intelligence that companies need. They can't just see
themselves as processing paper or as a back-office cost center, but as
being the ones that capture that can, through their use of systems and
investment in systems and networks, capture the data in invoices, for
example, and can feed that data into the sourcing cycle at the
beginning, so it becomes a virtuous circle.
They can
create the opportunity for the company to meet some of their very
strategic goals around working capital. So now AP and their ability to
tie into what procurement has done before them and automate the process
and get things done very nimbly and ready to go and create this
opportunity, are creating opportunity for treasury as well, so now you
have got a third party in there.
The treasurer is very
concerned about what his liabilities are out there, what the payments
liabilities are. Does he know? Often, in today’s world, treasurers can’t
see their payable liabilities until they run through their payment
cycle and they're ready to be paid the next day. So they have to move
cash around to make sure that they have enough cash to manage those
liabilities going out.
With visibility into what’s
going to be paid out 30 days from now, having that 30 days in advance
offers the treasurer all sorts of options on how to manage their cash
among various different bank accounts.
It gives the treasurer the opportunity to pay that supplier early, using excess cash that’s sitting in a bank account.
Plus,
it gives them the option to do things around their days payable
outstanding (DPO), to bring third parties into a business network, to
bring in third-party supply chain finance that allow a supplier who
might need early payment liquidity and early cash flow to access that
from a third party while the buying organization is able to hold on to
their cash, and so extend their DPO and improve their working-capital
management.
Or it gives the treasurer the opportunity
to pay that supplier early, using excess cash that’s sitting in a bank
account. Even though the Fed just raised rates in the last day or two,
they only raised it a quarter of a percent. So it’s still not earning
very much. But now, a treasurer can take that and pay a supplier early
in exchange for a discount that earns them something along the lines of
8-12 percent annually.
It opens up options, but right
at the nexus of all of that opportunity, information, and intelligence
sits AP. That’s a very strategic place for AP to be if they can get
their hands around that data, create those opportunities, and make it
visible to the rest of the business.
Gardner:
One last area to get into for 2016 … One of the top concerns in addition
to business agility for companies and organizations is risk, security,
and dealing with compliance issues, with regulatory issues. Is there
something that AP brings to the table when it has elevated itself to the
strategic level, with that visibility with that data, with the ability
to act quickly and be able to take on exceptions and work through them?
Andrew,
we've heard about how, on the procurement side, that examining the
supply chain, knowing that supply chain, being able to head off
interruptions or other issues, having business continuity mindset is
important. Does that translate over to AP, and why and how does AP have a
larger role in issues around continuity?
Risk mitigation
Bartolini:
From a risk-mitigation standpoint, when you have greater assurances,
that the invoices are matched to the PO, to the orders that have been
generated, to what has been delivered, when you have a clear view into
how that payment is made, across and into the supplier’s account, you're
reducing the opportunities for fraud, which can exist in any type of
environment, manual or fully automated. One of the largest
risk-mitigation opportunities for AP is really at the transactions
level.
When you start to cascade the visibility that
AP generates out into the larger organization, you can start to do some
predictive analysis from the procurement side to better understand
potential issues that suppliers may be facing.
Also
from a treasury standpoint, when you have visibility into the huge
amount of money that is being paid out by AP, you have a better sense of
your company’s liquidity, your cash positions, and what you need to do
to ensure that you maintain that liquidity.
Looking on
the supplier’s side, when you're processing invoices more quickly and
you have the opportunities to make payments early, there are those
opportunities for the larger companies to step in and help out some of
their struggling suppliers, whether that’s paying their invoices early
or some other mechanism. It starts with visibility, and from that
visibility you start to have a better ability to make smarter decisions
and to anticipate potential issues.
They may have had an otherwise healthy business, but not sufficient
cash flow to maintain operations, and that hurt buying organizations who
depend on them.
Gardner: Last word to you
Drew on this issue of risk reduction, continuity, using intelligence to
head off disruption or fraud, how do you see that panning out in 2016?
Hofler: I think AP does play a large role in that. Andrew touched on some of that.
One
of the key areas, if you think about supply chain and from the
procurement side, the financial supply chain is pretty much just as
important as the physical supply chain when it comes to risk. As we
learned, people have gotten it deep in their bones since 2008 and 2009
when liquidity became a very big issue. There was liquidity risk in
supply chains of suppliers who couldn’t access cash flow or didn’t have
sufficient cash flow. They may have had an otherwise healthy business,
but not sufficient cash flow to maintain operations, and that hurt
buying organizations who depend on them.
By being able
to approve invoices very quickly and offer up to your suppliers,
through a single portal, a single network access, access to cash, either
from a buying company using their own or bringing in third-party
financing, you essentially are able to eliminate or greatly mitigate
liquidity risk in your supply chain.
But there are
other areas of risk, too. Anytime you're talking about AP, Andrew said
it the right way, where he talked about the massive amounts of money
that AP is paying out. That’s their job.
In order to
do that, they have to actually capture, manage, and maintain bank
account information from their suppliers in order to pay electronically.
We're always trying to get away from paper checks, because paper
checks, we know, are rife with fraud, very horribly opaque and very
slow, but electronic payments require them to capture bank account
information. And that’s not a core competency of most AP departments.
Network power
But
AP departments can tap into the power of network ecosystems that bring
in third parties whose core competency that very much is, to eliminate
their need to ever even see a supplier’s bank account information.
Some
forward-looking AP departments are looking at how they can divest
themselves of that which is not their core competency, and in some ways
around risk mitigation and payment, one of them is getting rid of having
to touch bank account information.
Beyond that, when we talk about compliance and that type of thing, AP sits right in the middle of that, whether that be from
VAT
compliance in Europe, to archival compliance, to stocks compliance here
in the US, having all of the data electronic and having an auditable
trail and being able to know exactly where every piece of data and every
dollar or euro spent has been and where it went along the way and
having a trail of that automatically capture and archived, that goes a
long way towards compliance.
Some forward-looking AP departments are looking at how they can divest themselves of that which is not their core competency.
AP is the one that sits right there to be able to capture that and provide that.
Gardner:
I’m afraid we will have to leave it there. You've been listening to a
sponsored BriefingsDirect podcast discussion on the changing role and
impact of accounts payable as a strategic business force. And we have
learned how intelligent AP is rapidly transforming -- via better
managing exceptions, adopting fuller automation and implementing
end-to-end processes that leverage connected business networks.
So please join me in thanking Andrew Bartolini, Chief Research Officer at Ardent Partners in Boston, and Drew Hofler, Senior Director of Marketing at SAP Ariba.
And a big thank you as well to our audience for joining this
SAP Ariba-sponsored business innovation though leadership discussion. I’m Dana
Gardner, Principal Analyst at Interarbor Solutions, your host and
moderator. Thanks again for listening, and do come back next time.
Listen to the podcast. Find it on iTunes. Get the mobile app. Download the transcript. Sponsor: SAP Ariba.
Transcript
of a BriefingsDirect discussion on the changing role and impact of accounts
payable as a strategic business force. Copyright Interarbor Solutions,
LLC, 2005-2016. All rights reserved.
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