Every finance team wants to reach a state of Fintopia, a state where they have immediate insight into the entire accounts payable process and can use analytics to flawlessly predict cash flow and demand. So why doesn’t it happen? Why doesn’t every team reach Fintopia?
In many cases, the answer is quite mundane. It’s simply because not enough teams are building a solid foundation of automated data capture. As a result, they can’t see internal and external spend, how customer demands are shifting, which suppliers are most effective, and more. Without this data, their innovations tend to fall flat. After all, if you can’t see what’s currently happening, how do you know where to improve your financial processes? If you don’t have full visibility, how do you forecast? Without data, it’s next to impossible.
That’s why Fintopia is built on a foundation of 100% automated data capture. There are countless ways this can function inside an organization. In our Fintopia Report, which contains extensive original research, we focused on three.
1. Automatically capture all invoice information.
Perhaps surprisingly, we found that 44% of respondents say they still have to manually enter information into their ERP or other system of record. This means that standard, routine data is entered by a team of humans, taking up time that could be used to capture non-standard (but essential) data such as supply management trends. What’s worse, in many cases different teams start to develop their own ways of recording information, making it completely impossible to run advanced data analysis.
What percentage of the information on your organization's approved invoices are manually entered into an ERP or other system of record?
As you can see from the chart above, only 9% of finance professionals say they don’t have to manually enter any approved invoices into their system. These trailblazers are building a foundation of data that enables them to move more quickly. For instance, Heineken adopted invoice automation to cut the approval time for order-related electronic invoices by 95%. Time savings like that result in higher ROI and set them up to optimize their data sets for the future.
2. Automatically archive all invoice data (in a way that’s easy to retrieve).
Your ability to reach Fintopia rests heavily on the quality of your archives. Can your data analysts pull standardized information from a deep and robust archive of data? Can they be certain the data is accurate? If not, your analysts won’t be able to put the data to use. They won’t be able to see when a supplier is slowly trending toward making late payments, or when a supplier’s price is slowly creeping up (possibly at the same time quality is going down).
Fortunately, more than half of procurement professionals (64%) say that their accounts payable department digitally archives invoices and related data. Unfortunately, this means that the practice is becoming table stakes, so teams that don’t have this ability are quickly being left behind. In other words, it’s more essential than ever to streamline and automate the archiving process.
3. Automatically capture all early payment discounts.
Every AP team knows that success isn’t just about receiving regular payments. Timing is also essential. That’s why so many companies offer early payment discounts. And yet, most companies don’t fully capture this data and therefore can’t make informed decisions based on it. In fact, only 6% of finance professionals say they capture all this info today.
What percentage of available early-payment discounts does your organization currently capture?
It’s unfortunate that so few companies do this well since capturing early payment data empowers teams to see where their bottlenecks are, know what trends are changing, and favor suppliers that exceed expectations on timing.
Reach Fintopia Through Automated Data Capture
To reach Fintopia financial data across the entire procurement process must be captured and then effectively put to use. Once you’re capturing the entire range of data, you’ll be in a position to pivot quickly and effectively no matter what the future brings. Just think of what’s possible: You’ll be able to set up dynamic dashboards to give leaders immediate insights into what’s happening internally and externally. You’ll be able to optimize every part of the process in light of findings that were previously hidden, you’ll be able to automate auditing (which, unfortunately, is still part of financial departments even in Fintopia).
Of course, reaching Fintopia is about more than just capturing data. To see the full range of practices you can optimize to reach this state of procurement bliss, read our full report. And as always, contact us with any questions.