We’ve probably all heard of “The Great Resignation” by now. It’s supposedly a massive trend that has millions of workers getting out of the labour pool as the pandemic had them reassess their work-life priorities. Economists who are digging into labour market statistics are no longer sure that people are dropping out in droves. Instead, they see a more nuanced picture emerge where employees are quitting their jobs in record numbers, but only to seek out better, more rewarding careers elsewhere. The Amherst academic Arindrajit Dube therefore prefers to call this phenomenon “The Great Reshuffling.”
What does this development mean for companies in 2022 and beyond? Attracting and retaining the right talent will require companies to be ready to deal with the challenges of digital transformation as well. Otherwise, a tight labor market will hurt their competitive position.
Implementing digitalisation and automation is one way executives facing this dilemma can have their cake and eat it, too. Making key processes and workflows around the finance, accounts payable and procurement functions digital and automating them lets them boost their productivity and efficiency, plus engage key employees with value-added tasks and responsibilities at which professionals excel.
The messy state of remote work can be blamed for a lot of the upheaval organizations large and small are facing to this day. Back offices were closed for months, staffing levels were reduced and employees suddenly had to work from home or navigate the maze of hybrid arrangements. Adding paper-based processes to this mix, it’s no wonder that many teams experienced disrupted workflows and rising frustration.
Digitally transformed processes allow the flexibility necessary for current workplace trends
When market researcher Ardent Partners surveyed mid-market enterprises (MME) for its annual report entitled AP Pulse of the Mid-Market in 2022, they found that working remotely is one of the top challenges for one in four AP teams.
“Most MME AP departments and professionals were not raised with a work from anywhere spirit and the ability to easily work while remote. The underlying culprit, not surprisingly, was the reliance on paper – specifically paper invoices and paper checks,” Ardent Partners concludes. “For a majority of leaders overseeing AP, the pandemic made it patently obvious that manual processes are no longer acceptable and must be stricken from the workplace.”
Gathering all people in one big place and burdening them with desks, filing cabinets and inter-office mail is a paradigm that goes back to famous British economist Ronald Coase. He argued almost a century ago that we needed such bureaucratic structures to compensate for the high transaction costs of coordinating resources and thousands of staff to get their work done. Herding people made sense for decades.
Fast forward to 2022, and that logic no longer holds true. Digitalization is driving Coase’s transaction costs down to zero, and that’s particularly obvious when it comes to handling purchase orders, invoices and payments. Companies that implement cloud-based processes to get rid of paper documents and cumbersome workflows save significant amounts of time and money because they eliminate a lot of waste, errors and delays.
Digitally transformed processes create happier employees to retain employees
More importantly, they are laying the groundwork for attracting and retaining the right talent. Agile technologies such robotic process automation and machine learning can automate most menial and repetitive tasks such as data entry and review, including matching POs to invoices and intelligent routing for approval. In short, automation done right, and end-to-end, allows businesses to do more with less, or rather do more with the staff they have now, particularly if they aren’t in a position to hire new people yet.
Intelligent workflows also boost morale. Having employees’ hands and heads free empowers every team member to play a more strategic and value-added role, leading to a measurable rise in job satisfaction. What’s more, access to real-time analytics and reporting tools in teams’ browsers or mobile devices doesn’t just positively affect the bottom line – it turns a lowly invoice into the raw material for financial intelligence that can benefit all departments.
According to Ardent Partners’ research, mid-market enterprise AP staff today spend almost one-third of their time working directly with suppliers to fix invoice, processing and payment errors. The universal dislike for mundane and repetitive tasks like these reiterates the importance of implementing digitization: “For AP to move into its next phase of evolution, its staff cannot spend this inordinate amount of time tracking down phone numbers, correcting erroneous contact information and interacting with suppliers to lock down missing pieces of information and fix mistakes.”
Whether an organization chooses a hybrid work model or goes to the other extreme with so-called “notdesking”, automation accommodates their preferences and will keep the business going. Cloud-based workflows gives teams more flexibility to let the employees do their job from anywhere and without delays. After all, when there’s no paper, it can’t pile up.
Additionally, companies get to bask in an important halo effect that helps bring new hires on board. Job seekers post-Covid want more freedom and demand more space to grow. When Adobe recently polled Millennials about their preferred work arrangements, 73% said they’d switch jobs to one with greater flexibility if their salary and job description stayed the same, and two-thirds of Gen Z and Millennials said they’d switch for the option to work remotely.
Digitally advanced automation technologies attract top talent
And here’s one more compelling reason why automation can artfully blunt the impact of the Great Resignation or Great Reshuffling, whichever side of the argument you come down on. It turns a back-office role into a lighthouse project. When a traditional cost center becomes a pioneering services center, it can pave the way for the entire organization to accelerate the journey toward digital transformation. I’ve spoken with quite a few AP department leaders who were able to recruit outstanding candidates for that exact reason.
Not to mention new hires. They like to see top technologies and digital solutions in place when they’re evaluating new opportunities. What would you choose? A job that calls for manual data entry and shipping piles of invoices, POs and expense reports to the head office by courier every week – or one that puts a powerful set of tools at your fingertips to devise and run creative queries against live procurement and Accounts Payable data? Of course, the latter, I’d argue. It’s this kind of job that helps companies make strategic decisions that affect everything from cash management to more favorable terms with key vendors.
As the report states, “more nuanced skills and strategic thinking are required for the next generation of AP professionals.” In order to keep up with the evolving landscape and retain a strong workforce, you must automate the daily grind and make the essence of the procure-to-pay workflow more exciting. You’ll be surprised how many great minds will want to reshuffle their careers and join your journey.
By François Lacas, CMO Yooz