"Non-core, low-value" business processes like accounts payable are highly suited to Business Process Outsourcing (BPO). PayStream Advisors, underwritten by BancTec, released a detailed report on "Optimising Accounts Payable". Part of the report focuses on the benefits of outsourcing accounts payable to a third-party provider. Here's the short(er) version.
#1 Reduced costs
In-house implementations of accounts payable software and technology usually involve a high upfront cost. Traditionally, a business has to engage consultants in addition to IT personnel and the vendor - to design, implement, test and train. Accounts payable solutions may also be part of larger enterprise software packages and this can add to the upfront cost for businesses. In contrast, outsourcing providers have a different pricing structure based on transactions, transaction volume, and/or other key performance indicators. This "pay-as-you-go" method can reduce upfront and ongoing costs.
#2 Faster deployment
It's clear that old-fashioned or "legacy" systems are on the way out. Instead, "cloud" or Software-as-a-Service (SaaS) systems allows access to accounts payable through a web browser on a mobile, tablet, laptop or desktop device. Outsourcing providers usually interface with their clients using SaaS systems and hence allow a business to rapidly deploy new accounts payable solutions. PayStream also makes strong argument: SaaS solutions are automatically updated - witout SaaS and outsourcing providers, businesses would have to spend copious amounts of time and money on software upgrades and/or new hardware.
#3 Quicker "go live"
Despite the increase in the ease-of-use and versatility of accounts payable software, in-house staff still need to be trained and monitored. It can take several days to several months for organisations to come to grips with the new system. In contrast, outsourcing providers can "go live" almost straight away since they have an established software and hardware solution along with existing trained staff familiar with the processes and technology involved.
#4 Increased Efficiency
It can be difficult to convince suppliers to operate in a totally paperless fashion. But, if the outsourcing provider's location is used as the hub for invoices and other paperwork, your business rapidly becomes paperless. Additionally, while outsourcing is thought to be the offshoring of "low-skilled" tasks, outsourcing providers are proving themselves to be of benefit in specialised areas such as automating and operating accounts payable.
#5 Decreased labour costs
In today's business environment, whether it be Australia, Asia or Alaska, hiring employees can be a tricky process... let alone when it comes time to (unfortunately) let them go. Many businesses also have difficulty retaining employees due to changing attitudes in the workforce and/or more attractive offers from competitors. Even if temporary employees are available, good outsourcing providers will have staff trained and ready-to-go with performance metrics and service level agreements in place so you know exactly what to expect.
#6 Minimised risk
Finally, PayStream highlights how organisations have to face changes in the business environment, complex government regulations and the quick evolution of financial automation technology. Accounts payable is one area where a business can reduce risks by outsourcing.
Team Wired can help kickstart your Business Process Outsourcing, whether it be data entry, bookkeeping, or automating accounts payable. Contact us today before you're swamped in unending piles of paper.