The Value of Keeping Humans in the Loop in an Automated Environment

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Accounts payable (AP) leaders must cut through a lot of hype around automation.
From self-service supplier onboarding and touch-free invoice processing to digital payments and bots that respond to supplier inquiries, emerging technologies promise to replace workers with machines.

As tempting as it sounds, the key to optimizing AP lies in balancing people and process automation.

AP leaders must find automated solutions that redefine the role that humans play, otherwise, they risk deploying a fractional solution that takes the organization two steps forward and one step back.

That’s why more AP leaders are embracing automated systems that combine advanced technology with white-glove service. By putting people at the center of automation, organizations can achieve faster payback, stronger supplier relationships, reduced risk of fraud, and better business continuity.

This white paper shows you how.

Balancing people and process automation

Automation is transforming finance.

Consider the way that organizations pay suppliers. Over the past two years, the percentage of businesses that pay their suppliers with a paper check has declined by 7 percentage points. What’s more, 4 percent of all businesses now make all their payments to suppliers electronically1.


Ninety-two percent of treasurers say that increased efficiency was the primary reason for transitioning to electronic payments. Eighty-two percent of treasurers cited cost reduction2.


Beyond digital payment methods, new generations of more capable automated systems are emerging that eliminate friction across the invoice-to-pay lifecycle. Artificial intelligence (AI) and machine learning have made especially big strides in AP departments in re-cent years. These technologies are generating tremendous value, and companies of all sizes and across all industries are using them to uncover opportunities to earn early payment discounts, identify fraudulent transactions, and more.

About half of the activities (not jobs) carried out by workers could be automated3.

At the same time, technology is transforming the workplace itself. Rapidly evolving machines are performing more tasks previously done by humans. Work activities like data collection and data processing are easily automated, for instance. But that’s not to say that technology will spell the end of finance jobs.

In fact, the best results are achieved when humans work cooperatively alongside automated systems.

More jobs will be changed, rather than lost or gained, as machines complement human labor in the workplace4.

The most powerful automated systems are meaningless without people. For starters, someone needs to manage and troubleshoot automated systems. Someone needs to talk a supplier through their frustration with an erroneous payment. Someone may be required to explain the benefits of electronic payments to a supplier. Humans will always be needed to step in to assist with unusual or risky situations. And there always will be payment exceptions that require human intervention.

Humans may no longer do routine work. But they will play a big role in an automated environment.

Unfortunately, many approaches to AP automation are so focused on replacing human workers that they miss this fundamental point. There are no “humans in the loop” to complement the technology.

People and process automation: the pillars of holistic automation

The concept of replacing human workers with machines is a tempting one – especially in times like these when labor markets are tight. But a better approach to automating payments is to find a solution that uses human workers strategically to complement the technology. After all, if the goal of automating is to ensure that your organization is operating at its most cost-effective and efficient levels, then chances are you will need knowledgeable employees to help you scale and capitalize5.

That’s why more AP departments are embracing automated systems that offer white-glove services. These solutions combine ad-vanced technology with U.S.-based subject matter experts employed by the provider. The result is better outcomes at each step of the payment automation lifecycle:

Implementation
No organization has the appetite for long or complicated system implementation. SaaS-based payment automation solutions, backed by white-glove service, are deployed fast, with minimal IT involvement, no impact on existing workflows, and seamless integration with any legacy accounting software, enterprise resource planning (ERP) application, or system of record. As a result, these systems often can be implemented in five days or less, whereas traditional payment systems – which don’t make as great a use of subject matter experts as part of their rollout process – can take months to fully deploy.


Spend analysis
A first step to achieving strong supplier adoption of electronic payments is for an organization to review its spend file to see which of its suppliers accept electronic payments, and how much spending they represent. Many suppliers already accept electronic payments and focusing enrollment efforts on these suppliers will deliver the biggest bang for the buck. Few AP departments have the time to perform this analysis. Fortunately, payment automation providers typically perform this analysis as part of their white-glove services.

Enrollment plan
Organizations have too much at stake to leave their migration to electronic payments to chance. That’s why it’s imperative to develop a plan to enroll suppliers in electronic payments. The plan must include a strategy for communicating the benefits of electronic payments to suppliers and convincing them to switch. And it must define project goals, rules of engagement for each supplier, critical action items, milestones, and a timeline. If this sounds like a lot of work, you are not mistaken. But a payment automation provider can develop and execute this plan as part of its white-glove service. What’s more, unlike many banks and Fintechs that only enroll suppliers for a short period of time, leading payment automation providers offer ongoing supplier enrollment, with every batch of supplier payments. This ensures optimal adoption, even as suppliers change.

Taking a ‘set it and forget it’ approach to payment automation can result in missed opportunities to migrate suppliers from paper checks as their needs and decision-makers change.

Supplier enablement
The cost to convert suppliers from paper checks to electronic payments is the top drawback to conversion6. Once a supplier agrees to accept electronic payments, an AP department must collect the details needed to initiate payment. Paperwork must be completed, suppliers must be registered, and administrative tasks must be handled. And someone must oversee the entire enrollment process. AP teams shouldn’t have to take on this work. And they certainly shouldn’t have to bear the responsibility of collecting and storing sensitive banking details for all their suppliers. That’s why more AP departments are partnering with payment automation providers who offer best-in-class services.

Traditional payment automation solutions tend to limit services offered to suppliers.

Support
No one likes to feel like they are left holding the bag. But that’s what happens when suppliers cannot get timely help with updates to their payment preferences, changes to their banking details, issues with payment, or questions on how they will receive payments and related data.

One bad experience can have suppliers eager to return to paper checks, or worse, looking for the door. AP teams don’t always have the time or the expertise to respond to payment support issues. And suppliers don’t want to deal with an online support bot to get answers to something as important as their payments. Put the burden of responding to supplier support issues on the shoulders
of a payment automation provider that offers white-glove service. Leading providers have more than 100 customer service repre-sentatives based in the U.S. who can respond to inquiries from suppliers or AP teams in 2 hours or less. Some payment automation providers will even follow up with suppliers to ensure that all payments are processed, eliminating a potential reconciliation burden on AP departments.

Without white-glove support, all payment exceptions end up in your AP team’s lap.

Fraud
The increased risk of fraud is the biggest concern that AP leaders have about the way their department is operating these days. The prolonged shift to remote working disrupted established policies and procedures for paying suppliers. AP departments can mitigate their risk of fraud by partnering with a payment solution provider that offers white-glove service. Each year, the internal security teams employed by these technology providers stop hundreds of fraud attacks against their clients, saving millions of dollars. If an AP department that works with one of these tech vendors falls victim to an outside fraud attack – such as through phishing or Business Email Compromise (BEC) – the payment automation provider’s security team diligently monitors the organization’s payments for any suspicious or abnormal activity that might indicate fraud. And the security teams educate AP pros on an ongoing basis on how to mitigate fraud.

Eighty-five percent of treasurers cite AP as a key area within their organization to bolster with fraud prevention and control investments8.

Business continuity
If there’s one lesson that organizations learned during the pandemic, it’s that they must be prepared for the unexpected. With no telling when or if AP teams will return to the office full-time, organizations can no longer rely on sending paper checks through the mail or storing reference documents in filing cabinets. Organizations must have tools for their AP teams to work effectively from anywhere. Payment automation enables business continuity by eliminating tasks and establishing roles-based controls and providing AP leaders with visibility across the enterprise, whether that means across an office building, across town, or across the globe. Leading providers also have more than 100 payment experts online who can help an orga-nization navigate a fast-changing business environment.


Redefining AP
The operational benefits of AP automation are well documented. But an overlooked benefit of the technology is how replacing mechanical tasks frees staff to focus more time on fulfilling, higher-value activities such as collaborating with stakeholders to come up with solutions, building relationships with suppliers, and analyzing complex data to uncover new early payment discount opportunities and get a clearer picture on the cost to pay suppliers – the types of things that aren’t well-suited to today’s technology. When you free your AP staff from mind-numbing tasks that have nothing to do with their finance expertise, you unlock their value and skills to improve the value they deliver to the organization.

If history is any indication the new paths that technology will create on the road ahead are likely to bring more job opportunities, not job obsolescence. Research from McKinsey Global Institute projects that automation will create up to 83 million additional workers worldwide by 2030.

From deployment through day-to-day use, partnering with a payment automation provider that offers white-glove services helps ensure that an organization achieves the full benefits of AP automation.

Human heroes of automation

Few organizations still need to be sold on the benefits of migrating from paper checks. Seventy-one percent of AP departments plan to automate the way they pay suppliers, either for the first time or by refreshing their existing technology9. There are lots of compelling reasons for AP to automate.

But AP leaders must step back from thinking that automation is all about replacing human workers.
Only when AP departments combine advanced technology with human workers will they achieve optimal benefits. Partnering with an AP automation provider that keeps humans “in the loop” can help an organization migrate to electronic payments faster, drive sup-plier adoption of digital payments, strengthen supplier relationships, ensure business continuity, and mitigate fraud risk.


¹ Institute of Finance and Management (IOFM)
² Association for Financial Professionals (AFP), 2022 Payments Cost Benchmarking Survey
³ McKinsey Global Institute
⁴ McKinsey Global Institute

5 Ravin Jesuthasan and John Boudreau, The Harvard Business Review
6 Association for Financial Professionals (AFP), 2019 AFP Electronic Payments

7 Institute of Finance and Management (IOFM)
8 Strategic Treasurer, 2022 Treasury Fraud & Controls Survey
9 Institute of Finance and Management (IOFM)


Paymerang is an innovative payments solution for AP departments that transforms supplier payments into a new stream of revenue. By enrolling your suppliers in electronic payments, you can earn cash back rewards that can put several thousands of dollars back in your school’s pocket each year. 

Paymerang currently works with over 65 schools nationally to help take the tedious work of paying vendors, reconciling payments, and fraud prevention off their plate. A dedicated Customer Success Team will walk you through the simple process that takes less than 10 hours of total staff time to implement.

Interested schools can contact Paymerang’s Account Executive, Kenan Korfez at 804.256.7905 or by email at kkorfez@paymerang.com to set up a demo of the program and learn more about the impact Paymerang can have on your school.