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Businesses continue to struggle with outdated accounts payable (AP) systems that rely predominantly on inefficient, manual processes. These traditional approaches contribute significantly to operational delays, impacting productivity throughout the source-to-pay cycle. Manual workflows can lead to bottlenecks in tasks such as invoice processing and payment execution, among many others. The need for more streamlined solutions is clear.
Amid these challenges, more companies are turning to artificial intelligence (AI) to modernize their AP workflows. AI-driven automation presents an opportunity to reduce manual labor, enhance accuracy and boost overall efficiency. As firms adopt these innovations, they aim to transform AP from a source of delays into a catalyst for financial efficiency.
Outdated AP systems reliant on manual processes are a persistent burden on businesses. Their inefficiencies contribute to operational delays and hinder overall productivity, affecting various stages of the source-to-pay cycle.
These difficulties come as AP automation remains relatively uncommon. As of November 2023, 36% of mid-sized companies still had not automated any AP processes. Among those firms that have introduced AP automation, 44% had automated only one or two processes, and only 4.6% had automated all.
In fact, delays are the norm rather than the exception. PYMNTS Intelligence research shows that nearly two-thirds (63%) of CFOs experienced delays in their AP cycles.
These inefficiencies are common in areas throughout the source-to-pay cycle. For example, 15% of CFOs experienced delays in supplier onboarding, 17% in invoice matching, 18% in payment authorization, and 23% in payment execution, to name just a few.
More businesses are turning to AI to improve AP processes, recognizing the technology's growing importance. With plans for automation on the rise, firms aim to boost efficiency and address staffing challenges within their AP workflows.
The need for increased efficiency is especially urgent because AP teams are already overburdened. In fact, 9 in 10 CFOs say they outsource at least some of their accounting tasks, with AP being the most common area to contract out. Moreover, half of finance and accounting leaders who are not already outsourcing said they would consider it for their AP tasks.
AI offers significant potential to enhance AP efficiency by automating various tasks and improving accuracy. Companies are increasingly exploring AI-driven solutions to streamline workflows, reduce manual labor and support better financial decision-making.
AI has the potential to yield efficiency gains of up to 40% for AP processes. In fact, AP ranked as the accounting process that stands to gain the most efficiency through use of the technology.
Among the 74% of CFOs who intend to invest in AI accounting tools by 2024, accounts payable is the most popular investment target.
The integration of artificial intelligence in accounts payable processes presents a key opportunity for businesses to enhance efficiency and accuracy. As teams adopt AI technologies, they can streamline workflows, reduce manual labor and ultimately transform AP from a bottleneck into an asset.
Companies that embrace these innovations stand to gain a competitive edge in an increasingly fast-paced market.
Key benefits of AI integration in AP:
The evidence is clear: Businesses that invest in AI for AP stand to gain more than just time savings. They can improve accuracy, enhance financial visibility and free up the capacity for higher-level initiatives. Modernized AP processes can become a catalyst for financial agility, cost savings and overall business success. Now is the time to leverage AI technologies to unlock the full potential of AP operations.
