When tumultuous events arise, the disruption of processes, performance, customers, suppliers, and partners simply cannot be avoided. When they do overtake and impact us, keeping cash flowing is fundamental to keeping everything else moving too. Learn more from Sami Peltonen, VP of Purchase to Pay Product Management at Basware.
Automate and digitize to stabilize supply chain disruption
Indeed, every once in a while, life throws something at us that comes so far out of left field that it completely redefines what we thought we knew. Events that, when they transpire, end up providing the whole world with a sudden, stark, but important and timely reminder of just how easily control can slip from our grasp.
One obvious case in point is still panning out even as you’re reading this blog. And quite enough has been already been said and written about it without me commenting further here.
But it does illustrate three key points:
One, just how reliant businesses are on ‘ordinary’ everyday processes to keep functioning at the most basic level.
Two, how much we tend to take these ordinary processes for granted.
And three, that when something fundamentally impacts the business, our ability to react quickly and effectively is crucial. And it doesn’t need to be as dramatic and all-encompassing as a global pandemic.
How wide-reaching that ability needs to be should not be underestimated either.
While the impact of business disruption on physical and logistical supply chains is clear, organizations often overlook how severely financial supply chains can be affected – and how easily.
Consider something as simple as the physical presence of an Accounts Payable team.
When they are out of office, whether for health reasons or something else, the processes for which they are responsible cannot simply stop. Invoices must be processed. Suppliers must be paid. If this fails to happen, especially in the kind of waters we are all trying to navigate currently, the consequences could be dire.
Keep all your suppliers paid – regardless of size
There are already signs that certain suppliers – especially smaller ones – are beginning to struggle, while some could even go out of business altogether. That presents a significant threat not only to those businesses in the immediate firing line, but to organizations further down the supply chain.
Indeed, several big businesses are now taking steps to intervene and help. UK supermarket giant Morrisons for example, has just announced that it has accelerated payments to its smaller suppliers in the wake of recent disruptions. For smaller suppliers, this helps keep them afloat given they have far less cash on-hand to act as a cushion during challenges such as what we’re facing currently.
From the middle of March, to the benefit of around 3,000 of its smaller supply concerns, businesses supplying less than £1m of goods to the supermarket annually will receive payments within 48 hours rather than the previous standard two-weeks.
The biggest and most crucial catalyst for keeping business and society moving and flowing is finance. So, what’s the secret to keeping finance flowing in such circumstances?
Staying ahead of the curve with AP Automation
Taking slow, tedious, manual, paper-based processes out of the AP cycle and moving to a digitized process provides clear and compelling benefits. Submitting, processing, and paying invoices electronically is easier and faster. It means less paper, decreased handling of physical documents, and fewer manual interventions. Additionally, the automation of associated workflows such as routing, coding, matching, and approvals will realize similar benefits.
Agility and flexibility are further vital considerations when it comes to digitization and automation. Done properly, finance teams can work from anywhere, at any time, on any device providing significant payables, cash- and workflow benefits. While emerging machine learning (ML) and AI elements can help prioritize payments and manage discounts based on early payments.
Dealing with the curve balls is sometimes simply part of doing business. Given all this, it’s clear that automation can drive a direct and positive impact on the bottom-line of suppliers and customers alike. A crucial step in such a complex climate.
Use AP Automation to increase flexibility
To learn more about the benefits of AP Automation visit our solutions pages or download and read the trends from the EIU Report.