- Accounts payable teams cut the time they spent on core invoicing and payment tasks by up to 50% when they switched to automation, according to a Quadient customer survey.
- Calculating the value of work hours saved can help organizations quantify the return on investment. The average organization saw a 5x ROI.
- Freeing accountants to focus on high-impact, creative tasks supports employee retention and fosters a happier, more productive workplace.
Many companies hesitate to automate their workflows because of the perceived upfront cost. Yet automation is one of the few business development plans that can deliver an instant ROI by using employee time more efficiently.
Quadient recently looked at AP data from 331 customers. We found that accounting teams across dozens of industries all faced similar challenges with manual processes. But once they implemented automation, not only did workflows speed up and become more accurate, but the cost savings were instant. Customers saw an average 5x ROI on their monthly investment.
Account executive Nico McEown shared the findings of this survey in Quadient’s recent webinar, AP Data from 331 Customers. No matter the size of their organization, here are four elements that every accounts payable team could automate — and a tangible calculation of the money they saved.
1. Invoice processing
Paying vendors and suppliers is the core function of AP teams, so it’s not surprising that most accountants reported this took up the majority of their time. Perhaps what’s more striking is the value of the time saved from automation.
Of the companies surveyed, Quadient found the average organization processed 113 invoices per month and required two full-time equivalents to handle the workflow. With an average employee salary of $57,000, automating invoice processing amounted to savings of $726/week or $37,752/year.
2. Managing approvals
It sounds simple enough, but our customers reported that managing approvals accounted for 19% of their AP teams’ workdays prior to automation.
Chasing down signatures takes time, while managing approvals also includes all the necessary follow-ups and questions. It’s a thankless, tedious process. Based on Quadient’s data, automation cuts approval management time by 56%. Instead of waiting for approvers to return to their office or check a shared drive, documents automatically arrive at the mobile device of the person who needs to see it in almost real-time.
Automating approvals resulted in an average savings of $255 per week.
3. Scanning and filing
This is a category that saw a wide range across Quadient’s surveyed customers. Of course, companies relying on paper filing systems for invoices spent a great deal more time physically scanning documents to enter into their ERP and filing them away.
But that’s not to say paperless invoicing systems have no filing time required; it takes manual effort to share folders on drives, break down complex invoices or label complicated receipts.
Across all Quadient customers surveyed, the average time spent filing documents was 7% of the workweek, or 5.6 hours split between two full-time employees. Automation shaved that time by 33%, saving roughly $55 each week.
4. Sending payments
Prior to automation, another 15% of AP teams’ time went toward sending payments. From preparing the payment run to remitting checks, this is a time-consuming process prone to costly human error.
Quadient AP Automation has the added benefit of sending remittance emails to the vendor and linking a payment ID for easy tracking and lookup. The average time savings on payment automation was 3.6 hours, equalling about $108 per week.
Calculating the ROI
So far the automation savings from processing invoices, managing approvals, scanning and filing, and sending payments total $1,144 per week. If you figure four weeks per month, that’s an impressive $4,576 in monthly savings.
For the customers interviewed in this survey, the average monthly subscription for AP automation totaled just $873. That’s a stunning 5x return on investment.
The impact of AP automation savings
Companies in all industries have struggled with employee retention in the past few years. According to Gallup poll data, one of the top three things employees want is the ability to do what they do best. They want purpose, fulfillment and the opportunity to use their skills for meaningful contributions to an organization — and manually keying invoices is hardly anyone’s dream job.
Reallocation is the best word for it. Employees are moving their talents to more intellectually stimulating work.
“AP teams really appreciate it because now they're putting their time into more useful, interesting and impactful tasks as opposed to focusing on the monotonous tasks of data entry, managing emails and so forth,” Nico explains.
See it in action
Even our thorough research into 331 companies can’t anticipate the specifics of every situation. That’s why we’ve developed our easy AP Automation ROI Calculator.
Many managers wonder if automation is worth the cost. A better question is whether or not the organization can afford to keep manual processes and remain competitive.
Quadient AP is reshaping accounts payable with leading automation tools. Learn more about how Quadient injects modern finance teams with the efficiency they need!
