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How to Harness the Power of the Cloud for Accounts Payable

If you’ve heard of AP Automation before, chances are you know just how many varieties of accounts payable software are out there. There are on premise systems, invoice scanning software, solutions for procure to pay, open source programs – and the list goes on.

Sure, you can throw a dart at the options and run with whatever program you land on, but before you do, there’s one other option you should be aware of. It’s the new, modern normal for software as a service (SaaS) that’s gained a lot of positive traction in the past five years; That other option is cloud-based accounts payable software. 

Before we dive into the best ways to take advantage of the cloud to reach your accounts payable goals, let’s briefly go over just what makes a cloud-based AP solution so unique.

Silver-Lining Solutions in the Cloud

Increased Power for Finance Executives

Cloud computing is the term used to describe services that are delivered to a consumer over the internet. Nearly every piece of modern technology uses some form of cloud-based technology; from the photo storage on your smartphone to the infrastructure supporting popular video streaming websites like Netflix, it’s difficult to find a segment of technology untouched by the cloud.  

For finance executives, there’s a market-wide push for modernization of most business components, and it’s especially powerful in driving the adoption of technology in departments that traditionally have a high level of manual or paper-based work. Although there are several ways for businesses to adopt modern technology services, the two most common methods are through on premise and cloud-based software. Companies choosing to implement an on premise option - instead of something like a Software as a Service model - for their organization must be prepared to cover the upfront capital expenditure and IT resources and budget necessary to build and maintain the infrastructure for such a large application. For companies that don’t want to designate a vast amount of resources necessary to support these services in-house, the clear choice is to opt for cloud services.

The 3 Variations Inside the Cloud

In business, there are 3 types of cloud services:  

  • Public cloud is when the services and infrastructure are provided offsite over the internet. This is what is sometimes referred to as “true cloud” because it is the only type that brings you all the benefits of a cloud community and shared resources.  
  • Hosted or private cloud is when the service is maintained on a private network. Here you will still need to purchase and maintain the software and infrastructure and miss out on the benefits of sharing resources on a public cloud. It’s basically the same as hosting your solution in-house.
  • Hybrid cloud includes a variety of public and private options with multiple providers. One possible downside here is that a user will need to keep track of multiple platforms and make sure their different business solutions can communicate with each other.  

The variety of cloud service we recommend is a public cloud service, sometimes referred to as a “true cloud” which we’ll be focusing on the benefits of for the rest of the article.

Learn more about AP in the cloud - White paper: 5 reasons for AP invoice automation in the cloud.

Efficiency is Fast and Focused

It’s no secret that reacting quickly and efficiently to change is essential to the success of a business. When fluctuations, such as acquisitions, global expansion, and departmental reorganizations, occur in a business it can often seem like a never-ending checklist of steps to ensure a seamless transition. Having a business process solution that is hosted in the cloud leaves you with one less process to worry about being affected, as cloud-based software is scalable and agile enough to work with new or multiple ERPs and can be deployed without extensive onboarding to new users for immediate adoption. Additionally, any customer service needs are managed remotely by the hosting company, which takes the strain away from your own IT resources.  

Cloud-based services have another great feature to take advantage of when it comes to measuring and reporting on performance within the accounts payable department. Management can gain actionable insights (invoice processing time and automation levels) into how efficiently (or inefficiently) their AP team is operating. Because this data is reported real-time through the cloud, companies can make key decisions using of-the-minute business intelligence and accurately measure the effects of those adjustments. Even more important, the mobility of a cloud-based system means that multiple stakeholders can access the and manage reports from anywhere with an internet connection, increasing cross-departmental collaboration and productivity.

Reap the Financial Rewards

The cost-effectiveness of a cloud-based software is generally accepted and often a motivating factor for adopting a solution hosted in the cloud. Often, the savings come after deployment of the solution in the form of avoided IT requirements and soft costs for upgrades and customer service solutions.  

The efficiency provided by remote access for approvers through cloud-based accounts payable software translates into the potential for huge savings in avoided late-payment penalties and interest. With MediusFlow, an approver’s dashboard can be accessed through an internet browser on any device, which is why our clients boast an average manual approval lead time of 3 days or less, and an average total lead time of 7 days. This kind of streamlined, expeditious approval rate makes it easy to achieve early payment discounts and take advantage of dynamic discounting models with key suppliers.

Choose Wisely

Choosing a partner in the cloud to accommodate your unique business needs is a big decision to make, and it’s important to fully understand what a solution has to offer in their accounts payable software.

Below are a few key areas to explore before settling on the cloud-based system that’s right for you.

  • Can the solution provide touchless, end-to-end invoice processing (from scanning to coding/allocation through the approval and syncing with your ERP, all without human intervention)?
  • Has the vendor deployed their solution with another client using the same ERP as your organization? Are there any case studies or testimonials for those clients?
  • How long has the vendor been in the business of providing accounts payable solutions?
  • Is the solution solely focused on AP or do they have many solutions for various business processes?
  • What does the vendor’s global presence look like? Will they be able to support your business as you grow into new geographies?
  • Does the vendor outsource any part of their development or customer service? What level of support can you expect before, during, and after deployment?
  • Does the vendor provide any benchmarks or KPIs that compare their clients with the rest of the industry?
  • Does the solution require any strict rules or conformity from your suppliers in order for it to be effective? 

Harnessing the power of the cloud recaptures the ability for accounts payable teams to improve productivity for maximized efficiency, to better manage the business’s cash flow with increased visibility and reporting, and to become the most agile, scalable component of a company’s financial department.  

Want to learn more about AP in the cloud? Download this whitepaper: 5 reasons for AP invoice automation in the cloud.

Daniel Saraste

VP Product Management

daniel.saraste@medius-group.com
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