How ERPs are Holding Back Accounts Payable Processes

October 18, 2023
How ERPs are Holding Back AP Processes
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The Problem

Current enterprise resource planning (ERP) systems are not sufficient to handle company Accounts Payable (AP) processes. These systems are often lacking in terms of functionality and are not purpose-built for the processes at hand, leading to a negative cycle of bad automation practice across finance teams and businesses alike. 

Findings from The CFO’s finance automation survey indicate that 50% of overall respondents do not raise purchase orders because they are simply too hard to organise through their current ERP systems. A staggering 60% of these respondents also report being dissatisfied with their current purchase request tools, limiting overall adoption. Why might this be? 
  • Lacking in function: System-specific intricacies and cumbersome interfaces make it difficult for users to navigate ERP software and use them effectively. Employees often find manual data entry time-consuming and a burden to use, disincentivising proper use of purchase orders without effective automation features.  
  • Lacking flexibility: Standard ERP systems often lack the adaptability required to meet evolving business needs. Customisation options are limited, leaving finance teams constrained within predefined functions, the process of adding a single custom field often requiring specialist input and hours to implement.  

These findings underscore significant challenges in the ways finance teams are hindered by manual processes such as invoice matching, raising and approving purchase requests, and establishing audit trails. Current tools are not aligning with user needs and expectations, resulting in delayed purchase order creation, low tool adoption rates, and difficulties in establishing clear audit trails.

Additionally, finance teams and management may not occupy the context to recognise bad practice in automation, therefore not reaching the root of the overall problem. This lack of contextual understanding often leads to an ongoing cycle of inefficiency. Without recognizing the nuances of their inefficient processes, finance teams find it challenging to implement effective solutions. 

The Solution

Kloo harnesses the latest Generative AI technology to supplement ERP systems and optimise AP functions in finance teams. Our pioneering autonomous AP tools are integrated with AI technologies to achieve new levels of accuracy and efficiency, saving time across a variety of financial functions. 

  • AI-powered payment processing: PO requests utilise GenAI to deliver the best user experience, allowing employees to raise purchase requests in natural language via email, making the process time-efficient and accessible.  
  • Invoice automation: AI technology and OCR data extraction manage invoice data, directly matching POs to invoices or receipts and reduces the need for manual processing. 
  • Payment run and approvals:  The automated payment run creation and approvals engine enhances accuracy and enforces company payment policies. 
  • Email integrations: Off-platform email approvals can minimise delays in approving purchase order requests, all without having to log in to the platform.
Additionally, Kloo's purpose-built, customisable features harness flexible usability, streamlining financial management across a variety of functions. 
  • PO and invoice matching: Kloo offers the ability to set custom rules determining when invoices should be automatically or manually matched. 
  • Customised approval flows: Unlimited, threshold-based approval workflows allow the user to direct workload to designated approvers through departments, accounts and payer entity functions.  
  • ERP system integration: Kloo functions as a standalone AP tool, but can also be integrated with other existing ERPs and accounting software. 

While ERPs are often seen as the obvious or easy choice for AP management, they lack in functionality and flexibility for their users. Complex processes, rudimentary automation, and manual processing waste hours of time every week for finance teams and disincentivise employee engagement with AP best practice. Kloo provides the solution: leveraging the power of AI technology to automate your AP processes.  

Purpose-built to manage a variety of financial functions, Kloo’s built-in automation services streamline the entire AP workflow, from purchase order creation to invoice processing and payment approval. By harnessing the capabilities of AI and automation, Kloo ensures unparalleled accuracy and efficiency, saving valuable time and resources for finance teams. 

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