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How new technology is curing ailments and streamlining processes in one practice’s AP department.
The practice I work for, Family Allergy & Asthma, was founded in 1979 and is a group of board-certified allergy and asthma specialists with offices in Kentucky, Indiana, Ohio, and Tennessee. We currently operate more than 50 clinics with over 30 Board-certified allergists and physicians.
Like many businesses, we are continually looking for ways to streamline our operations, maximize cash flow and create better processes. One thing we have recently tackled is our accounts payable (AP) process.
We regularly work with hundreds of vendors from immunotherapy drug manufacturers for things like wasp serum, to medical suppliers to Staples for office supplies. But, none of our transactions are PO-based, as departments place orders as needed directly with vendors.
As such, our finance team has had little insight into the AP pipeline. Until recently, we didn’t have any visibility into invoices until the order arrived. With the majority of our 400 monthly invoices coming in via postal mail, processing was manual and slow. Our accountant hand-coded each invoice and managed approvals among fifteen people.
We knew there must be a better way, so a few months ago we began looking for new technologies to help. It was especially important that any new solution would integrate with our enterprise resource planning (ERP) system.
The work-from-home order due to the COVID-19 pandemic came in just as we were implementing our new automated solution, Stampli. Fortunately, we were able to get set up in about one day and our 15 invoice approvers trained quickly.
Automating our AP function has fundamentally changed the way we do business for the better.
Approvals now move quickly. We can easily and quickly identify who has what invoice and its status in the approval process. It’s easy for our approvers to ask and answer questions in real time, track approvals, and establish an audit trail—all without anyone having to be onsite.
We have reduced our invoice lifecycle from 10 to 3 days. Our invoice lifecycle used to take up to 10 days, and with that came the risk of late payments and potential fees. Now it's been shortened to about one day per approver, so three days total—that’s a 70 percent reduction in the invoice lifecycle.
We are 90 percent faster getting invoices into Intacct. We’ve gone from 10 days to just one day to get all invoices into our existing ERP system, and that's a huge value add because it gives my team insight into all invoices so we can better plan. Additionally, with the COVID-19 crisis, cash flow management has become more critical, and our solution’s search capabilities allowed our team to quickly manage it by identifying outstanding invoices for payment.
Big changes—like pivoting to telemedicine—are less painful. Right after our invoices were automated, our IT director was tasked with rolling out telemedicine to enable providers to treat patients who were sheltering in place. Suddenly he had a huge project to implement, and at the same time a growing number of invoices to approve. With full visibility into all invoices, we were able to identify which ones needed his approval, reduce his load, and enable him to focus on other projects.
The combination of the pandemic and how much our AP process has improved has shown our company the need for digital automation. From an accounting systems’ perspective, we’re at the beginning of what we will do with automation and new we have the foundation to establish future growth.
A few tips for practices and physician offices looking to automate some of their financial processes:
Zachary Kulow is the Financial Controller at Family Allergy and Asthma. An experienced Controller, Zachary has held financial positions at many well-known companies including Castle & Key Distillery and GE Appliances. He has a MS focused in Accounting from The University of Akron.