A recent study by the International Accounts Payable Professionals (IAPP) shows that few senior executives are actively engaged with what’s going on within the Accounts Payable (A/P) departments at their organizations.
In a majority of companies, for example, only the Chief Financial Officer (CFO) and the Controller are truly aware of A/P automation efforts and the potential benefits. Other key executives such as the Chief Executive Officer (CEO), the Chief Operating Officer (COO), Chief Information Officer (CIO) and Chief Technology Officer (CTO) are not, according to the IAPP.
This lack of awareness may be one reason why many companies continue to struggle with inefficient paper-based processes even though other business processes have long since been automated.
One way to accelerate efforts to automate the A/P department is to garner the support of more C-level executives. Executive support has been critical to the success of almost all major automation efforts at enterprises over the last few decades and there’s little reason why it should be any different for the A/P function.
A look at the list of the most commonly cited obstacles to A/P automation shows clearly how important the support of the C-suite can be. Many A/P executives for instance, cite a lack of internal IT resources as being their biggest impediment to implementing A/P automation.
One of the reasons could simply be that CIOs and CTOs are not aware of finances efforts to automate A/P functions. The IAPP study showed that less than one in three CIOs are actively aware of automation projects within their A/P departments
Similarly, many of the respondents in the IAPP survey said their A/P automation projects were being stalled because of “too many other projects” at their companies. It's no mere coincidence that less than 20 percent of chief operating officers are aware of what their A/P organizations are doing to automate key processes, or why they might be doing it. As a result, A/P automation projects are often given a lesser priority than other, more visible, projects.
Interestingly, when a C-level executive is sufficiently informed about the issue, s/he tends to remove many of the obstacles to automation. For instance, CFOs and Controllers are the only senior executives who really are informed about A/P automation efforts within their organizations. They are also the executives in charge of the corporate purse strings.
Perhaps that’s the reason why A/P automation projects seldom get stalled because of a lack of money. So it’s quite conceivable that if a CIO or a CTO were made similarly aware of A/P automation efforts, IT skills availability wouldn’t be such a big issue. Similarly, if a CEO or COO knew how important A/P automation was, it’s quite possible that such projects would be given a higher priority.
The CFO needs to lead the way when it comes to A/P automation but almost all c-suite executives these days have a stake in modernizing the A/P function within their organizations whether they realize it or not.
A/P automation projects that are done without the active participation of the internal IT organization for instance, could end up resulting in the introduction of non-standard platforms and technologies.
So, CIOs and CTOs have a stake in ensuring that A/P automation technologies are introduced, tested and implemented in a manner that is consistent with the rest of the organization. Similarly, chief security officers and chief risk officers have a stake in ensuring that new A/P projects and technologies are rolled out in a secure manner.
Security executives and risk officers are under more pressure than ever to ensure data security and compliance with state, federal and industry-specific mandates relating to data collection, use, retention and destruction.
CEOs and COOs have an obvious stake in ensuring the modernization of their A/P departments. Numerous studies have documented issues related to costs, errors and inefficiencies that exist within most A/P departments because of their continuing dependence on paper-based processes.
The key to raising the visibility of A/P automation efforts among such executives may well lie in making them aware of just how much of a stake they have in it as well.
We’d also be happy to act on your behalf and get answers to the key questions and concerns you have about accounts payable automation. If you have questions leave a comment below, contact us through this web form, send us a Tweet or contact me personally on Linkedin. Help us shape the editorial agenda for this blog so you can get the most value out of what we produce.
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Victor Bensusan is CEO of Yakidoo. He has 20 years experience in Finance and Information Technology primarily in the area of process automation, information management and business performance improvement.