So you have decided to outsource your accounts payable operations or your shared service – what now?
How do you make sure the transition is a smooth one and provides the desired productivity gains and financial return on your investment?
Having spent 20 years guiding companies through this process, there are a number of considerations that can influence whether this transition to an outsourced model succeeds or not. Here are six tips that will help ensure your company minimises the risks and successfully outsources its accounts payable:
- Choose your outsourcing partner carefully
Take the time to check their references. Talk to their existing clients directly, rather than relying on website testimonials.
- Transparency is essential
Ensure that you and your AP team members have complete accessibility and visibility of all processes. Your colleagues will support you if they can access any invoice and understand at a glance its processing status, the processing history and the assigned team member.
- Visit the outsourcing company
It is worth the overseas or interstate trip to meet the people you are going to work with. Take the time to get to know them and understand their strengths, weaknesses and how best to communicate with them. Establishing this relationship will help you and them to succeed. Take note of how the company employees are treated and check for fair work practices. Partnering with a “dodgy” business could damage your company’s reputation, and even its bottom line.
- Set KPIs
Before you make the transition to an outsourced accounts payable model, take stock of your current performance to establish a benchmark. This includes the number of invoices processed per person, error rate, on time payments etc. Then create similar KPIs for the outsourced accounts payable team. This will help you to measure the performance of the outsourced accounts payable team based on “before and after” data, not emotion.
- Employee engagement
It can take time for employees to adjust to a change in process. The best way to manage the change is to involve your AP staff. Ask for their input; engage them in training the outsourced AP team or developing documentation and materials. They will feel valued and in most cases gain from the experience. Consider offering an incentive or bonus to help motivate staff. Ensure your AP team is informed every step of the way. Keeping the plan to outsource accounts payable a secret can create unrest and distrust.
- Disaster Recovery
And finally, ensure you have a contingency plan should something go wrong. Establish a clear Service Level Agreement that you can fall back on. Consideration should be given to back up and disaster recovery arrangements as well as short-term solutions should the outsourcing provider go off line.
Do you have more questions about outsourcing accounts payable and business process optimisation? We can help you provide exceptional customer experience while making your entire operation more efficient.
Contact Richard Bates at firstname.lastname@example.org