Organizations that have low levels of automation in capturing, transmitting, and processing invoices lack real-time visibility into expenses, making it difficult for them to manage spend, cash flow, and working capital.
Stamford, CT and Orlando, FL (PRWEB) September 14, 2011
A report sponsored by Basware, the leader in enterprise purchase-to-pay, and conducted by professional association The Institute of Financial Operations indicated that companies are becoming more sophisticated in how they approach procurement and finance. While e-invoicing implementation may be gradual, there has been clear growth since last year as companies begin to understand its benefits.
It’s striking that the number one financial priority for companies in 2011 is improving operational efficiency – far surpassing their focus on increasing profits and top-line performance. The great majority of organizations surveyed recognize the importance of e-invoicing in helping them achieve this objective, and they also realize the negative consequences that come from primarily relying on manual processes.
Indicating an increase in invoice processing since last year, the 2011 e-invoicing survey results show that approximately one-third of those who took the survey reported that their employers did not in any way use e-invoicing. That compares with a similar question from last year’s survey in which 58 percent responded that their companies used a manual data capture and approval process for receiving invoices.
The majority of survey respondents (nearly every respondent), however, think that there is room for improvement in how companies leverage technology to implement key invoicing processes. Despite an understanding of the benefits of e-invoicing in terms of cost savings and increased efficiency, many companies have been to slow to adopt it.
"The research sponsored by Basware shows us how much promise the technology has, but also how far we have to go in terms of educating financial leaders to make the investment and commitment,’’ said Thomas M. Bohn, president and CEO of The Institute.
The survey also identified the challenges respondents face in sending and receiving non-electronic invoices, including time spent entering and scanning invoices and securing their approvals, as well as misplaced or lost invoices.
“The insights gathered from our research with The Institute of Financial Operations help Basware better meet the needs of our customers as we partner with them to achieve excellence in procurement and finance. The results of this survey are very revealing, and they underscore the significance that companies place on automating their key financial processes,” said Bob Cohen, vice president of Basware, Inc. “Organizations that have low levels of automation in capturing, transmitting, and processing invoices lack real-time visibility into expenses, making it difficult for them to manage spend, cash flow, and working capital. Without visibility, it’s also hard for procurement and finance departments to share information, further clouding the financial picture.”
Companies that took part in the survey noted that speeding up invoicing processes and reducing invoicing costs were the most compelling reasons to implement e-invoicing. These companies also recognize the benefits provided by an open network, where buyers and suppliers can easily transmit e-invoices and purchase orders without the need to install the proprietary technologies that traditional networks typically require. They value the increased efficiency and cost savings that such an open network delivers.
Almost half of research respondents said that they are able to receive and process invoices electronically, and a quarter of respondents are able to send invoices electronically. However, 76 percent of these respondents indicated that they receive e-invoices as e-mailed PDFs and 50 percent of them print out the e-invoices for further processing, which does not allow them to take advantage of the full benefits that true e-invoicing offers, such as increased AP automation, improved invoicing quality, and reduced manual errors.
“While there is increased interest in improving e-invoicing capabilities, most companies are still at the very beginning stages. Basware is committed to helping companies activate e-invoicing in their organizations so they can fully take advantage of all of the benefits e-invoicing offers,” Cohen said.
Supporting survey findings that e-invoicing adoption is growing, the U.S. federal government has just recently mandated that by the end of 2012 all treasury bureaus must implement the Internet Payment Platform (IPP), an electronic invoicing processing solution, and that all of its commercial vendors submit invoices by IPP by the end of 2013.
A total of 434 respondents took the survey during the spring and summer, with the largest number representing accounts payable managers and supervisors. Other titles included chief financial officer, controller, treasurer, financial executive, accounts receivable manager, accounts receivable supervisor, and operations manager. Most (81.8 percent) were in North America, with 16.3 percent in Europe and a few in South America, Australia, and Asia.
The full report is available at http://www.financialops.org/research at no charge to members of The Institute and for purchase by nonmembers.
About The Institute of Financial Operations
The Institute of Financial Operations is a membership association comprising four affiliates: International Accounts Payable Professionals (IAPP), International Accounts Receivable Professionals (IARP), the National Association of Purchasing & Payables (NAPP), and The Association for Work Process Improvement (TAWPI).
Based in Orlando, Fla., with offices in Boston, New York, and London, The Institute serves as a global voice, chief advocate, recognized authority, acknowledged leader, and principal educator for people in financial operations, with a particular focus on accounts payable, accounts receivable and payments, automation, data capture and document management, and procure-to-pay. Combined, the affiliates have more than 6,000 members.
Under The Institute, the affiliates share one board of directors, one staff, and a single portfolio of member benefits available to all, including Financial Operations Matters magazine and a new website scheduled to launch in late 2011. Each affiliate maintains its own brand, events, career resources, volunteer opportunities, online tools and other leading-edge resources, and educational offerings including e-learning and certification.
Basware (http://www.basware.com) is the global leader in purchase-to-pay solutions with more than 1,000,000 users in over 60 countries. The Basware Open Network for e-invoice and purchase message transactions today connects more than 320,000 companies globally. With Basware, an organization can reduce the cost of buying and paying for goods and services and gain visibility and control of its entire spending process by automating manual processes, from sourcing, contract management, purchasing and supplier collaboration to invoice automation. Basware solutions and services enable a company to improve its cash position, optimize working capital and maximize the agility of its finance operation across the purchase-to-pay cycle. The solutions are distributed and implemented, either on site or as a service, in Europe, the U.S., and Asia-Pacific through an extensive network of Basware offices and business partners. The company’s U.S. business, Basware Inc., is headquartered in Stamford, Conn. More information can be found at http://www.basware.com.
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