The process of purchase-to-pay (P2P) is constantly changing. Automation brings efficiency and precision, while human insight still plays an important role. Do we really have to choose one over the other?
In this article, we look at how automation and manual processes can interact and complement each other, so your business can get the best out of both approaches.
Automation vs. manual work
Automation provides businesses with valuable data analytics that can help make smarter choices, such as the right supplier strategy and better negotiations. However, human insight is often needed to interpret the data and make the crucial decisions. Automation is not about replacing people, but about empowering them with good tools.
While automated systems efficiently handle routine tasks and standard transactions, human expertise steps in when deviations occur or more complex challenges arise. That's when the interaction between technology and people provides good solutions.
What are the benefits of automating procure-to-pay?
Manual P2P processes can be both time-consuming and error-prone. Repeated data entry, managing deadlines and transferring information between systems can easily lead to delays and inaccuracies. By automating these tasks, the margin for error is significantly reduced, while the business becomes more efficient and better equipped for growth. Automation improves precision and frees up time for more value-adding work.
The benefits of automation include:
- Faster data collection and processing of transactions than with manual methods.
- Fewer errors in data entry and calculations, resulting in more accurate data and fewer discrepancies.
- Better compliance with internal policies and regulatory requirements.
- Real-time insight into P2P processes, providing more control over operations.
- More accurate analytics and reporting that can be used for cost savings and efficiencies.
- Reduced need for manual intervention, reducing operational costs.
What are the benefits of manual processes?
While automation offers many benefits, there is still a need for manual processes - especially when flexibility and human judgment are crucial. Complex or unique cases often require solutions that go beyond what automated systems can offer.
A good example is sensitive negotiations with long-term suppliers, where human communication and the ability to adapt to situations play a crucial role. In such cases, the human factor makes a big difference.
Benefits of manual processes:
- Humans have the ability to adapt to unique situations and handle exceptions with greater flexibility than automated systems, giving you operational freedom that technology cannot yet fully replicate. At the same time, artificial intelligence is evolving rapidly and machine learning models are becoming increasingly adept at handling common exceptions and learning from past experience. While human oversight is still crucial in complex or ambiguous situations, AI can now effectively take care of more standardized deviations.
- Manual processes leave room for human judgment and expertise, especially in complex situations where flexibility in decision-making is needed. As AI gets better at analyzing and interpreting large amounts of data, it plays a supporting role by making recommendations and assisting with data-intensive decisions. However, human input is still necessary when decisions require a broader context or ethical considerations.
- Good supplier relationships are built on communication and negotiation. While automation can make transactions easier, it's human interaction that builds trust and strengthens these important business relationships. AI has become increasingly adept at supporting such interactions by analyzing past communication and relationship history, as well as handling simpler negotiations. Yet the finer nuances of human relationships - such as reading emotions, adjusting tone and building trust - are irreplaceable and critical to the long-term success of supplier relationships.
The future of P2P: A harmonious combination?
The discussion about procure-to-pay shouldn't be about choosing between full automation or human effort, but about how these can be combined to leverage the strengths of both. Automation provides businesses with efficiency, accuracy and scalability, while human expertise adds flexibility, strategic depth and strong business relationships.
With the development of artificial intelligence, more and more aspects of the P2P process can be automated, including communication and negotiation. However, the human nuances of relationship building and strategic decision-making will remain irreplaceable.
By combining advanced technology with the human touch, businesses can achieve more agile operations while retaining the flexibility and insight needed to manage both complex decisions and valuable business relationships.
Want to learn more about how AI and automation are impacting P2P?
Check out our Sofa Talks episode, "7 myths about AI-based invoice processing", where we explore and clear up 7 common myths, and show you how AI can improve your P2P process.