Have an Accounts Payable Automation project initiative? Before you get too far in the vendor evaluation process, make sure you have evaluated whether it really makes sense to house an automation solution inside your ERP.
At first glance, many AP departments think keeping an AP automation solution inside of their ERP is the best option. Makes sense – who wants to adapt to a new technology? However, there are many drawbacks to “inside ERP” workflow, so let’s dig in and take a look.
4 Drawbacks of Keeping AP Workflow Inside Your ERP
- Integration Risks
Opening up your ERP system to add AP workflow automation carries significant costs and risks. Solutions that function within an ERP environment often require a major investment of time and money for installation, integration and maintenance by ERP application engineers. (Read: IT won’t be pleased.)
- Flexibility and Functional Limitations
Solutions developed to operate within an ERP environment are, by nature, limited in their ability to integrate with multiple systems. Businesses need an AP workflow tool that will work with any AP-related systems they may currently have or may add in the future.
- Impact on ERP Performance
In the constantly changing IT landscape, it is important to integrate AP workflow automation at a level that maintains ERP system integrity while working seamlessly with the ERP system. Tools that operate with an ERP environment can tap system resources allocated to core ERP applications and other enterprise systems. The impact is multiplied as companies add systems through mergers and acquisitions, and as additional staff require more resources. Offloading AP workflow from an ERP server to an independent architecture can allow for higher server performance and reduced drain on resources.
- Workflow Inside Means Recognition Outside
“Inside ERP” workflow solutions need data to work with. This data must be extracted from paper invoices, email, faxes, EDI and any other means by which a company receives invoices. Placing this important part of the solution outside of an ERP system, while approval workflow is inside an ERP system, creates a break in the end-to-end audit trail that companies are looking for to better control business processes.
Advantages of AP Workflow Outside of Your ERP
Workflow outside an ERP system allows users to access all relevant information in order to make an informed decision when approving an invoice, without the need to be an ERP solution user. This can reduce the need to add ERP seats in the execution of an AP automation project. Users have a single access point for invoice data along with the original document image and a history of actions carried out.
As a result, companies can:
- Share AP data across business applications
- Include Purchasing and other involved departments in the workflow
- Include pre- and post-processing steps in the workflow
- Extend approval workflow to remote staff and across mobile devices
- View archived invoices and audit trail outside and ERP application
Interested in learning more about housing an AP workflow solution outside of your ERP?
Check out our white paper, Best Practices in AP Automation: Consolidating Workflow Outside ERP Systems.