By Matthew Dragiff
Director, Product Management, SunGard AvantGard
Recently, I had an interesting conversation with an A/P manager who was told to reduce her A/P department budget by 10 percent. No one told her how to accomplish this, but after some analysis a reduction in staff seemed to be the only alternative. Fortunately, two employees approached her about working part-time and what could have been a painful staffing adjustment became a win-win situation.
As companies struggle to recover from the economic downturn, these directives are all too common – reduce headcount, do more with less, outsource non-core functions and streamline processes. No one disputes the efficacy of technology to achieve these goals, but capital funding is a major challenge.
Often times, we see automation technology implemented in the same sequence as A/P processes. Areas such as document scanning, OCR, e-Invoicing, imaging, workflow and payment approval are addressed before payment execution. But did you know that payment execution has the potential to fund other A/P automation efforts?
The latest trend among corporations when it comes to payment execution is to pay invoices electronically by card using virtual card technology. Adopting an electronic B2B payment strategy that takes advantage of highly secure virtual cards will enable your company to reduce its A/P costs, streamline A/P processes, and generate revenue through card rebate programs.
Rebates from card payments can turn your A/P cost center into a revenue generator. Your company can earn rebates from check disbursements that are migrated to card payments. These rebates are based on a defined percentage of your total monthly spend and are paid to you monthly. This contributes directly to your company’s cash flow. You can use these rebates to fund your A/P automation initiatives upstream. Using card rebates to offset the cost of additional automation makes the ROI in your business case even stronger and more compelling!
What do you think?