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Where we’ve been and where we’re going

GUEST BLOG

By Jim O'Rourke

For those of us who have been involved in AP, in one capacity or another, for many years have seen technology play a big role in the evolution of AP from a largely paper based, data entry dependent operation.  But over the past several years, we have seen many improvements in technologies affecting AP.  Moving from the old “green screen” financial systems (and believe it or not they are still around) and complicated workflow applications to more user friendly ERP platforms and the myriad of point solutions has provided AP managers the ability to transform their operations.  So, how did we get here and where are we headed?

Over the past year, we have seen the acceleration of a trend that has been taking place over the past decade – consolidation of technology vendors who are prominent in the AP space.  It started when large technology companies saw the need to add the big Enterprise Content Management (ECM) companies (and their AP automation solutions like workflow) to their portfolios.  IBM acquired FileNet, EMC bought Documentum and Oracle absorbed Stellant.  The next step was for these companies to add data and document capture to their suite of products so we saw EMC/Documentum add Captiva and IBM/FileNet take on Datacap.  While these transactions mostly affected large companies from an AP perspective, the ripple effect began.

In the past couple of years, we have seen this trend continue with Hyland Software buying AnyDoc and Perceptive Software purchasing Brainware and being bought by Lexmark to name a few.  So, what does this mean for you the AP manager or practitioner?

One manifestation of this consolidation is you will now see fully integrated AP solutions from these vendors.  The technologies can now be packaged and integrated into a single solution with content management, capture, workflow technologies bundled into an application. 

As with most things, there is the good and the bad to this trend.  On the good side of the ledger, there will be more opportunities to implement a “holistic” solution to automate your AP operation from a single vendor.  It makes the procurement and implementation process much more streamlined.  While this will no doubt be a very attractive development for many AP departments, it is not for everyone.

The downside of all the consolidation is less choice in putting together customized solutions to build an AP operation designed to meet the unique needs of your business or industry.  Many larger companies, or those with complex supply chains, may not benefit from this trend and will still look to purchase best of breed point solutions to address specific functionality.

So, where is all this headed?  In the new year, and in the years to come, you will start to see some new trends in AP technology emerging.  With the consolidation of what we will call the first wave of AP technology – capture, imaging, workflow – we will now start to see much more emphasis on the next wave.  This next wave will be dominated by the same trends we see in other aspects of our business and personal lives.  Data, e-commerce, networks, social media, and other emerging technologies will become more and more prevalent in AP automation.  Specifically tools like vendor portals, dynamic discounting, open trading/invoicing networks, web based vendor management systems, and the continuing move towards transforming paper documents into electronic records that can be easily moved around the world in seconds and stored for a fraction of the cost of paper.  So, expect to see more new vendors coming onto the scene and the inevitable next wave of consolidation that will follow.  In fact, with SAP’s recent purchase Ariba, it would appear that wave has already begun to form.

Whether you are a small, medium, or large AP operation you will be the ultimate beneficiary of all this consolidation in the long run.  It will spurn new innovations that can help you to continue the transformation of your AP organization while lowering the cost for the more established technologies you have come to rely on.

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