Accounts Payable Survey 2010 – Key Findings

The Future for AP in 2010
The last 18 months have been challenging times for all organisations during which time the collapse of several household names has been a sharp reminder that no-one can afford to become complacent. With Accounts Payable increasingly taking on a more strategic role, and moving away from the mainly transactional role of the past, CEOs are responding by placing further demands on the department.

With this in mind, it came as no surprise to see that increasing efficiencies (83%), reducing costs (61%) and implementing new technology (51%) came out as the top 3 challenges facing AP for 2010.  Get these three areas right and the control is back where it’s needed – in the hands of the AP Manager.

Today’s Reality
However, when it came to what AP departments are actually doing now, the reality was somewhat different. While some 59% of our respondents said that they scanned their invoices in, and 53% were able to accept e-invoices – only 24% were able to capture early settlement discounts, only 33% captured weekly KPIs and only 22% managed a
P-card scheme.  In a move away from our survey last year, and a clear indicator of a slightly more optimistic economic outlook, reducing staff numbers as a method of cutting costs moved into third position behind increasing efficiencies (77%) and purchasing new AP software as a method of cutting costs. A further 35% of respondents stated that finding duplicate payments was a priority for them.

What is Best Practice & Do You Want it?
When asked specifically, 74% of those surveyed stressed that it was their aim to become a best practise AP department – many giving valid suggestions as to how such a department should operate.  Again, this further emphasises the gulf between what AP departments aim to achieve and the processes which they’re currently using to try to achieve those results. With many AP managers highlighting a lack of time and reduced resources as being among some of the reasons why they are unable to work in the conditions they would like, it is likely to be a question of when this shift towards
best practice will happen, but not whether.

Supplier Relationships
Our respondents were also surveyed on how they managed their supplier relationships, and although the majority (48%), said that it took no more than 5 minutes to set up a supplier account on the master vendor file, 26% stated that it took on average 10-20 minutes or more. On top of this 33% indicated that they spent “a fair amount” of time dealing with suppliers chasing late payments.

Control of one-time only suppliers continues to be an issue with 18% of our respondents picking this as the one area they would like to improve the most this year, together with compliance and an improved system for guaranteeing swift invoice approval. When asked specifically whether they’d consider using a secure online platform for managing one time only suppliers, more than 40% said that they would.

Conclusion
In conclusion, the prospect for those in Accounts Payable remains one of consolidation – limited growth and an emphasis on tighter controls and efficiencies. In other words, whilst the outlook is a little brighter than last year, there remains a strong element of nervousness within the general economy which is reflected back into the financial powerhouse of our organisations – Accounts Payable.

With an emphasis on improving technologies, increasing control and the purchasing of new AP software, the shrewd AP Manager will have his/her ear to the ground for all the new products out there, to ensure their departments are best placed to take advantage of any impending economic upturn.