With the end of the year fast approaching, it is time to start thinking about 2022. How will the accounts payable landscape evolve? What technology trends will shape work in AP departments? In this article, we share our top AP automation predictions for 2022 along with some tips for a successful year in AP.
E-Invoicing is set to transform invoice exchange
E-Invoicing is a disruptive technology that is transforming traditional methods of invoice exchange. Many countries—including Italy, Brazil, and Singapore—are far ahead of the U.S. when it comes to adapting a uniform E-Invoicing standard. Improved fiscal consistency, uniformity in accounting, and optimized business efficiency are just some of the advantages offered by transitioning to an E-Invoicing standard. E-Invoicing is particularly important for companies that operate globally, as these need to be familiar and comply with the laws in their various places of business. However, organizations whose operations are limited to the U.S. should not rest on their laurels, as the American government is expected to adopt electronic invoices soon. This will result in a set of regulations stipulating the invoice format (including mandatory information), how invoices are to be submitted, and the scope of the regulations (e.g., B2G, B2B, and B2C). Standardized rules on how to provide and process invoice documents will smooth the path towards AP automation. Why? Because when every invoice is submitted in the same format and contains the same information, companies can easily automate repetitive AP tasks such as invoice receipt and data extraction. Even though it will probably be a few years before there is a nationwide E-Invoicing standard in the U.S., it would be wise to begin preparing for this inevitable shift in 2022.
Digital supplier management will become more prevalent
Digitization continues apace, transforming more and more industries and business departments. While many organizations have already automated their AP processes, there is still work to be done in procurement departments. Nevertheless, an increasing number of organizations is starting to recognize the benefits of a digital supplier portal that allows them to communicate easily with their vendors. This trend will continue in 2022. An online platform allows both customer and supplier to upload information, exchange documents, track orders, and manage their business relationship, while integrated self-service options enable suppliers to access information at any time. A digital supplier portal such as our Business Partner Portal Sphere streamlines processes, increases flexibility, and supports companies in their digital transformation journey.
Artificial intelligence is here to stay
With its diverse fields of application, artificial intelligence (AI) is a true game-changer in how we do business in the twenty-first century. That’s why corporate investment in AI will continue to increase in 2022. Most companies have come to recognize the technology’s immense potential and are keen to use AI and data to improve their processes. This is especially true for departments such as AP and procurement, where due to the repetitive nature of some financial processes, AI can provide quick wins. By automating the invoice processing workflow and reducing the amount of manual labor required, organizations can pay their invoices much faster and receive early payment discounts. As a result, AI-based AP automation optimizes cash management and provides direct business value. It also leads to more security and reliability along the entire AP process. In 2022, the role of AP staff will continue to evolve: instead of manually processing invoices, employees will deliver business insights and monitor relevant finance KPIs to ensure business performance.
Formerly outsourced processes will move back in-house
In the past, many companies relied on business process outsourcing (BPO) to reduce their operating costs. Accounting and payroll processes, for example, were typical BPO candidates because they are labor-intensive and do not vary greatly between companies. These processes were often delegated to a third party, who owned, administered, and managed them on behalf of its customers. But this trend is currently reversing, with more and more organizations bringing tasks that were previously outsourced back in-house. Why? Because of the significant cost savings provided by digital solutions. By digitizing and automating their workflows, companies no longer need to rely on external service providers to save costs. Instead, they can use a software solution to perform formerly labor-intensive processes efficiently and cost-effectively.
More companies will move their processes to the cloud
By now, the transition to the cloud is well underway. According to a recent market report, 85% of businesses will follow a cloud-first principle by 2025. Moving to the cloud can deliver numerous benefits, including reduced capital expenses, increased flexibility, more efficiency, improved security, and better long-term competitiveness. In 2022, companies will continue to develop their cloud strategies and prepare their processes for migration. This is especially important for SAP customers who would like to use the new SAP platforms and integrate their processes into S/4HANA. To begin their cloud migration process, many of our customers have chosen a hybrid scenario that includes on-premises installations as well as cloud solutions. If your organization has not yet begun preparations for the transition to cloud computing, the new year would be the ideal time to do so.