04.29.15 |
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P2P Trends 2 of 5: Leveraging Workflow Rules to Help Reduce “Approver Fatigue”

WorkflowAnother trend highlighted in the recent PayStream Advisors’ webinar on the “Top P2P Trends for 2015” was “eliminating approver fatigue.” Not all invoices are created equal, so it generally does not make sense to give the same time and attention to every invoice. But in the world of paper invoice and manual processes, organizations often have no choice but to review, code and approve every single invoice in the same manner. However, payables automation solutions can help address some of these issues by allowing organizations to configure business rules that allow for the auto-approval of certain invoices that match pre-defined criteria.

So let’s take a look at some scenarios where the manual review and approval process can be automated or even eliminated to move toward a process that manages by exception instead of focusing on every single invoice.

Imagine your organization subscribes to a magazine every year and the annual subscription fee is $20. Now think about the typical invoice approval and payment process. The magazine’s AR department would have to generate an invoice and send it in the mail to you.  Someone in your payables department receives the invoice, reviews it and sends it to an approver who has the required authority.  This person approves the invoice and then sends it back to the AP department so that it can send a check as payment against the invoice. Add to this the effort associated with generating and approving a requisition if the company follows a traditional procurement process that requires pre-approval for every purchase.

That just seems like a lot of effort and cost for buying a $20 item. In situations like these, organizations can use purchasing cards (p-cards) as an alternative to the traditional invoice and payment process. Or in the event that corporate policy dictates that every purchase has to be associated with an invoice, these low-dollar purchases may be good candidates for auto-coding and -approval. Depending on your organization’s spending policies, you can determine the dollar threshold for auto-approval.

Purchase orders are another way to help reduce effort on the back-end of the process. If detailed purchase orders can be used for certain expenses, once the invoice comes in and matches the PO and the goods receipt, it can be automatically approved and sent for payment.

Yet another criterion for auto-approval of invoices is segmenting your supplier base and identifying strategic suppliers. If there is a certain set of suppliers from whom you regularly buy the same goods and services, and you have had no issues in the past when it comes to invoices, you could consider setting up auto-approval rules for these suppliers and periodically auditing the invoices to ensure there are no errors and exceptions.

Finally, recurring invoices like lease payments that follow a certain schedule and are always the same amount may also be good candidates for auto coding and approval.

Setting up business rules that facilitate the auto-coding and -approval of invoices helps to increase processing efficiencies and reduce approver fatigue. This has the additional benefit of helping to free up AP staff and approver time from tactical activities to focus on more strategic and value-added tasks like spend management, supplier relations and discount capture.


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