AP Stays Lean With Exercise

There are times in my career that I have felt the manual processes of Accounts Payable push my patience to the limit and make me want to jump off the wagon and eat a whole cake. Which would be awful because those calories just make it difficult to move! I found that the reason these processes pushed me to the brink of sanity had to do with the lack of understanding from upstream. No one really knew what was happening within AP to make us all slow and sluggish.

The water always flows down, AP is the bottom of the basin. How does one clear out the basin without manual processes? Hard answer: you can’t. If the data flowing into your AP world is a hard copy or is dirty with static, there’s not much an AP department can do but manually clean up the data. That means data entry is by hand, invoices are touched more often than necessary, human error happens frequently, and there is over all lag in the payment process.

Taking a tool from the Six Sigma world and mapping out all the steps of the payment process can bring a lot of unnecessary lag to light. Six Sigma has a practice of counting time, clicks, or handoffs during every step of a process. For many areas this may be over kill, but when you are dealing with manual processes timing every step can give you an idea of how much manpower you need to complete a task and if it’s worth hiring more people or getting an automated system instead.

For example, ever seen an AP system that allows you to enter in the invoice in entirety before it tells you that it may be a duplicate? You’ve essentially added an invoice to your data entry processor’s KPI that is not counted at the end of the process. This is time wasted on empty metrics, no value to time spent.

What about time spent waiting for systems to load? Timing should not just be added for the amount of time it takes for the employee to do the work, but also the time we use waiting for reports to run. Have you ever sat and waited for a screen to show up in your ERP system so long that you move to another task? This is time wasted. Context switching eats up time. Switching from one task to another increases the likelihood of errors or lag in finalizing a task.

All of these lags can come to light when you create a process map. Call it an invoice’s journey if you don’t want to sound too technical. Generally speaking, it is easier to create a map if the journey is confined to your AP department, but if you need to bring in other departments, be sure to keep it nonjudgmental and always fact based. It’s the process, not the people, that need review. Always keep mapping about the process.

So, keep up those new years resolutions and keep your department healthy! Your AP map (or The Journey of an Invoice) should be looked at once a year to be sure it’s still relevant. Just like any exercise routine the best way to stay lean is to be consistent with your processes and continue to follow your journey.