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Improve AP Performance BY MAKING KPIs COUNT 1 of 5

KPIIn the world of accounts payable, “measurement” is critical to analyze performance and help increase operational efficiencies. This series of blog posts discuss the key performance indicators, usually referred to as KPIs, that AP departments are advised to track and monitor to improve the performance of their operations. Keep in mind that while the responsibility of tracking KPIs may ultimately fall under various roles or groups—depending on many different factors such as the size of the company, the industry, the organizational structure, or even the interest of individuals— the key is that there must be clear accountability as to who is responsible and how the tracking is done. For example, milestones such as how often the measurements are taken, how progress is tracked, and how the data is shared should all be part of a formal process that all groups within the organization should have visibility into for maximum efficacy.

Percentage of Electronic Invoices and Payments

One of the primary goals of AP automation is to remove paper from the source and migrate to electronic invoices and payments. For organizations that have implemented an electronic invoicing and/or electronic payments solution, a valuable metric is the percentage of invoices received electronically and the percentage of payments made electronically to suppliers. Electronic invoices are those received via EDI, a web portal or other B2B connections but do not include invoices received via email that still need some data entry. Electronic payments include all non-check payments made via ACH or wire.

 

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This article was orginally posted on Paytech.com in January 2015

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