This blog is part of a series detailing the projected outlook for purchase-to-pay (P2P) in 2020. Increased adoption of automated processes, a changing workforce, and increased government regulations all present challenges in the near future for many AP departments. Preparing for these challenges and meeting them head-on is essential to ensuring sustainability and profitability for any organization.

P2P in 2020 will be about perfect processing. Perfect processing involves entirely automated untouched transactions with first-pass acceptance and payment. This results in seamless collaboration between suppliers and buyers to ensure timely payments that capture the highest discounts and rewards.

The level of perfection an AP department attains depends on efficiency and effectiveness. In essence, efficiency in AP is a measure of what your process is taking away from your organization—How many invoices are electronic? How much time are staff devoting to manual data entry? What’s the average cost per invoice and turnaround? These are also the areas that will drive effectiveness. Effectiveness is the measure of the value that your AP process is adding to your organization—What is the rate of invoice exception? What percent of available discounts are captured? Does the organization have enough visibility to monitor and control maverick spending?

Strengthened relationships with suppliers, transparency into spend, and increased revenues are all results of an effective AP process. As more businesses realize and adopt perfect processing, suppliers will come to expect quicker payments. Eventually, perfect processing (and the resulting fast payments) will become the status quo. Organizations that take steps to move toward efficient and effective P2P will see a larger long-term ROI than those that wait to implement perfect processing after it has already become the norm.