This year, Ardent Partners highlighted three steps to face and overcome the challenges that AP departments have been encountering and will continue to encounter due to the COVID-19 pandemic. These three steps were:
- Ensure continuity
- Build resilience
- Support recovery
Within each of these steps, Ardent Partners provides strategies for success. Here are some of the strategies outlined by Ardent Partners to help organizations ensure that they are safeguarding continuity, building resilience and supporting recovery.
Strategies to Ensure Continuity
As the pandemic rages on, it is essential that organizations’ AP leaders do what they can to ensure continuity and make sure the business can maintain business operations. Right now, this means focusing heavily on cash management. Ardent Partners recommends that AP leaders:
- Align AP operations with the CFO and its team to ensure liquidity. This helps assure that cash management and liquidity are prioritized by utilizing the power of AP to provide intelligence around cash management and real-time updates and direction as to how to execute payments.
- Understand and react to changes in business and supplier payment strategies. It is crucial that AP leaders are flexible and able to react to changes in the market as the pandemic continues to develop and use the knowledge they gain to react even more effectively as the crisis continues.
- Develop short-term “work-arounds” to fill gaps in core AP processes. If your organization has yet to develop new long-term processes, the first step is to find short-term fixes to manage the immediate impact of the pandemic and its effect on business operations.
Strategies to Build Resilience
Once you’ve assured that your business operations can continue, the next step is to make sure that you have adapted and returned to a state of operations that is sustainable in the long-term.
- Accelerate automation efforts. Now is the time to truly explore how automation can benefit your AP department. Because the transition to work-from-home is lasting longer than anyone expected, part of adapting to this new culture is having the tools in place to sustain it. Automation is one of those tools and it’s time to embrace the power of digital transformation.
- Expand all cash management tactics and strategies. The pandemic continues, so businesses must make sure that their cash reserves and access to credit can get them through the coming months. Of course, AP is pivotal in cash management and it has the ability to provide visibility into invoice- and payment-processing and can help CFOs strategize payments.
- Invest in and develop an agile AP workforce. You will want to make sure your AP employees are agile, flexible, savvy and able to respond to real-time challenges facing today’s AP departments.
- Push the department to become more forward-thinking and strategic. If your AP department has been doing things the same way for years, now is the time to rethink those processes and procedures. Whether that means investing in new technology, reconfiguring the department or updating processes, it’s important not to get complacent and to think more strategically.
Strategies to Support Recovery
While we can’t predict that another pandemic will happen again in the near future, it is vital that companies make sure they can recover from the current crisis in a way that will allow them to continue to move forward successfully. The time to plan for recovery is now.
- Collaborate with other key stakeholders to closer operational and strategic gaps. The most efficient, effective and strategic AP departments work together with other stakeholders to enhance the way they work and to ensure they are managing working capital and cash in a smart and intelligent way.
- Maintain and build organizational expertise. Now is a good time to take a look at AP staff and see where there are gaps in knowledge or expertise and provide training and other educational opportunities. You want to make sure that your team is highly skilled and effective to manage the challenges of the current times.
- Develop more robust data and intelligence capabilities. The better your data, the more strategic you can be. Collecting and analyzing data in real-time allows your leadership team to make more informed decisions about payments and payment processes.
- Revamp disaster recovery and continuity plans. It may be a long time before corporate returns to a state of “back to normal,” This means that AP leaders have to apply what they’ve learned during the pandemic to safeguard themselves for future crises to assure they can handle unknown events down the road.
No matter where your teams are working and what industry you work in, making sure that you are set up to get through this current crisis and are prepared for future events is important, and now is the time to get ready.