Automation is drastically changing the way we work. New professions are emerging that weren't there ten years ago. When my accountant came by recently, I told him that companies are increasingly appointing a purchase-to-pay manager to bring the accounts payable and purchasing departments closer together. Something he could hardly imagine. When he was still in training, alarm bells were ringing precisely where procurement and finance were one.
By Michiel Leenaers, senior account manager at ICreative
My accountant and I have known each other for years. When he visits, we always take a moment to tell each other what we are currently working on and talk about developments in our field. In finance, companies are increasingly thinking in terms of processes rather than departments. For example, at some clients I see the processing of invoices coming under the responsibility of the Chief Procurement Officer.
Traditionally, finance and procurement have actually been separate worlds. That, according to my accountant, was taught in school. After all, whoever is wearing both hats can orchestrate the process, and that does make it very susceptible to fraud. With a manual process, there is also no audit trail where you can trace who placed the order and who worked the invoice. A payment to a "wrong" bank account number is then easily made.
Automation
Today, invoice processing is increasingly an automated process, especially in large enterprises and institutions. When you receive tens of thousands of invoices on an annual basis, automatically matching invoices leads to efficiency, provided the process is seamless. Unfortunately, this is often not yet the case in practice.
For example, it happens that purchases are not or incompletely recorded in the system, receipts are not booked, packing slips are lost, no one in the organization knows who placed the order, supplier questions cannot be answered quickly, and the pile of paperwork on the administrative assistant's desk continues to grow rather than decrease.
Troubleshooting
As a result, accounts payable spends too much time on the administrative handling of the entire procurement process, from ordering to processing purchase invoices. Traditionally, the finance department often solves problems in the operational process, for example, by correcting an incorrectly submitted purchase order with a correct invoice. So this is where something goes wrong, because this is not the responsibility of the Accounts Payable manager.
Finance, in my opinion, has a signaling function in these issues. Purchasing is basically responsible for creating the contract. Purchasing managers should take concrete action to make things easier for finance. They should make contractual agreements on how invoices are delivered. That may be easier said than done.
New feature
Getting suppliers to submit data in a different way is quite a challenge. Often the supplier also wants to receive the purchase order in the same format. So that means that Purchasing has to consider this issue together with Finance. This is a joint responsibility. The position of purchase-to-pay manager was thus born.
Back when my accountant was learning the business, the purchase-to-pay manager did not exist. Logical, because software for automatic invoice matching didn't exist yet either. We live in an interesting time with automation and new professions. I wonder what I will tell my accountant next time.