Written by Annabel Sim, Compleat Software: Those of you who think that finance professionals are the only people who benefit from having your purchase order and invoice management process online are mistaken!
The benefits go far beyond commitment accounting, time saved from invoice data entry and manually keying into your finance system to pay your suppliers.
These aspects, of course, are an inevitable step into the 21st century when it comes to paperless systems and data access from anywhere on any device. But what about all the employees in the multiple departments spending company money?
But this isn’t only essential to finance departments. All departments that spend also benefit:
1. Keep track of commitments made in your department
When there is only one person in your department making purchases within your budget allowance, keeping track of orders might be easy. But as you scale up, purchase orders will keep track of what’s committed in your department, who it was committed by and when, also providing a record to check invoices against. Make sure you have the visibility to keep on top of all committed spend within your department, with an easy way to analyse where it’s being spent.
2. Gain visibility over spend against your budget in real-time
Capturing purchases as they happen provides you visibility in real-time of what has been spent against your suppliers, budget, and projects. This information is fundamental to accurately manage how much budget you have left and what your department is planning to spend money on in the future. As you raise your orders, you will also have a view of the status of your supplier account, which means you can use this information to ask for better pricing from your supplier.
3. Save time reviewing and approving Invoices
Remove the time spent approving invoices with automation, the purchase invoice could be automatically processed, checked against your purchase order and receipt and if there is a match (within tolerance), the approval can be completely automated. Saving you a lot of time reviewing and approving every invoice when you don’t need to.
To achieve these benefits, first and foremost you must provide the tools to the people that spend the money and make them aware of the benefits of adopting the new process.
A growing proportion of company purchases will be made directly through supplier websites, so if your spending departments can use ‘Punch Out’ functionality to shop directly on these websites, add to their shopping basket and create the internal purchase order directly within your online application. This will deliver a purchasing experience that we all use when we personally shop online, meaning an easy, seamless, company purchasing experience for all staff who buy on behalf of the company.
For most businesses, about 70% of all purchasing are repeat orders for the same or similar goods and services. When you order, you can save it as a ‘Template’, so the next time you order, you simply open your template, make any amendments and you are ready to order again. This functionality significantly speeds up the buying process and includes all of your budget and supplier checking information in real-time.
Finally, solve the problem of getting timely approvals for purchase orders and invoices. To achieve this, make authorising requisitions and invoices easy and accessible on any web-browser or mobile application, so approvals become accessible anywhere on any device. By speeding up the reviewing and approval process, it ensures the best purchasing decisions are being made, saving a huge amount of time. Your suppliers will also get paid faster, retaining good relationships.
Department budget holders are given the responsibility of effectively managing their budget, but without access to these tools to easily capture what they are purchasing from their suppliers, they are left relying on out of date monthly management reports and their own spreadsheets to manage their departments spend against budget. Your budget holders can become better, more informed financial managers of their areas of responsibility, simply by capturing the order within the new application, which will, in turn, make available the real-time information required to make the most informed spending decisions that they can.
Written by Annabel Sim, Compleat Software. Exhibiting on stand 460 at Accountex 2018.