In today’s world, the phrase “time is money” has never been more relevant. It’s absolutely vital to get things done in a timely manner, with minimal hassle and the lowest possible amount of wasted time. So it’s no surprise that companies of all shapes and sizes across a myriad of industries are always looking for ways to save time and become more efficient in their day-to-day operations.
There may be many areas in which your business can save time and improve efficiency, and one of those areas is surely accounts payable. Because no matter what sort of business you’re running, there are always bills to pay, invoices to sort out, and finances to keep track of. It can be very wise, therefore, to put measures in place to reduce the amount of time spent on accounts payable processes. Here are some tips and tricks to help out.
Simplify the Workflow
One of the first top tips we can provide when it comes to improving efficiency for accounts payable processes is to make the entire AP workflow as simple as possible. This means trying to reduce the number of check runs you carry out and try to centralize all data in one easy-to-access repository.
Make Use of Top Tech
In today’s technological age, there are many tech tools and pieces of software that can improve efficiency in many areas of business, including accounts payable. AP automation systems can help you save huge amounts of time and reduce the risk of human error too, so find out about these tech solutions and start making use of them today.
Get Started Early
When it comes to approving invoices and managing your various accounts payable processes, it’s always best to get an early start. This allows your AP professionals to feel less pressured, making them less likely to rush through the process and make simple mistakes that could generate problems and bigger workloads later on.
AP processes can seem a little monotonous and tedious at times, but they’re a vital part of the day-to-day running of any business, and they need to be treated with due care and consideration. A single mistake during the process can be disastrous, so try to ensure that all AP teams remain focused and concentrated on their job, reducing the risk of workplace distractions however you can.
Enforce Access Limitations
Another good practice to get into when it comes to accounts payable is to carefully control access to key files, like the master vendor file, in order to reduce the risk of accidental errors, data breaches, or leaks. Make sure that only those with requisite experience and seniority are granted access to key files and limit the access of other users to prevent any mistakes or difficult situations from occurring.
Value Your Teams
Ultimately, every business is dependent on its employees. You need them to carry out their tasks and duties as efficiently as possible in order to keep your business growing and evolving, and if their motivation or focus levels start to drop, you can see the effects on your bottom line. Motivate, inspire, and value your workers by creating a positive workplace culture, responding to employee requests, and showing you care about their needs.
Make Invoices Your Top Priority
When doing check runs for your AP processes, make sure to focus a lot of your attention on invoices. They need to be prioritized based on the due date and payment terms, and it’s vital to get your invoices in order, as a single missed payment or late payment can have a lot of consequences for the company later on.
Many businesses make the mistake of acting like their vendor payment terms cannot ever be changed, but this simply isn’t true. Over time, situations change, and you might be able to get a better rate that could help your company in a lot of different ways. All you have to do is call the vendor and try to renegotiate. They might decline, but it’s still wise to give it a try.
Strong Communication Is Key
Communication is an integral aspect of any business and plays a key role in many aspects of the typical company. It’s really important for AP too, as processes can get delayed or errors can occur if clear communication lines aren’t open between your AP teams. Set up a strong communication channel, making use of digital systems as needed to ensure that all of your team members can keep each other updated and on the same page.
Use RACI for Clarification
When carrying out any kind of work-related duty or task as a team, it’s vital that every team member knows their specific role in relation to the overall group. The RACI structure can help with this. RACI stands for Responsible, Accountable, Consulted, and Inform. Each team member should fit into one of these categories, and this can help everyone in AP understand where they stand.
Reduce Verification Responsibilities
Often, it’s the CFO who has to sign off on any checks, but the actual check runs are carried out by team members throughout the AP department. If the AP team does their work correctly, there really shouldn’t be any need for the CFO to verify every little bit of data before signing off. If you optimize your process well enough, you can cut out some of the unnecessary verification steps and save everyone a lot of time.
The days of filing cabinets and reams of documents are slowly fading away, with many companies all over the globe going paperless and switching to digital documents and cloud-based storage solutions instead. Give this a try yourself with the help of trusted software and wave goodbye to paper invoices and checks.
Accounts payable can seem like a lot of work at times, and it’s a big aspect of any business that needs to be handled with care, but with these tips and tricks, you can optimize your AP processes like never before.