The document discusses 5 key performance indicators (KPIs) that are important for measuring accounts payable performance and how automation can help improve them. It outlines the 5 KPIs as invoice lead time, processing costs per invoice, invoices processed per full-time employee, invoice exception rate, and invoices linked to purchase orders. For each KPI, it provides industry benchmarks and standards, describes how automation can help reduce costs and errors as well as improve productivity through tools like optical character recognition, machine learning and workflow automation.

1. 5 KPIs THAT DRIVE
ACCOUNTS PAYABLE PERFORMANCE
Delivering The Future of Work
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2. 2
Common Accounts Payable Challenges
1. Reduce database errors due to manual data entry
2. Monitor invoices collection from various channels
3. Identify AP fraudulent transactions
4. Reduce number of exception and manual workflow bottlenecks
5. Match invoice data with purchase order, contract value, and
goods/services received notes
6. Improve efficiency of multiple accounts payable channels

3. 3
• To identifying bottlenecks
• To maximize the efficiency of the accounts payable department
• To continuously measure performance against key business
objectives
• To set the target for continuous improvement
• To track efficiency, effectiveness, quality, timeliness, project
performance, personnel performance or resource utilization
• To provide objective evidence of progress towards achieving a
desired result
Why AP Department Need to Track KPIs?

4. Benchmark Accounts Payable KPIs
Industry
Benchmarks
Top Performing
Companies
Why is it Important ?Accounts Payable KPIs
1 Invoice Lead Time 17 days 8.3 – 3.7 days
Faster invoice processing
Competitive Payment Terms
2 Processing Costs Per Invoice $ 10.08 6X Lower / $3.34 Reduce Operational Cost
3 Invoices Processed per FTE
~3000 - 5000
Invoices / month
~ 8000 – 20,000
Invoices / month
Improve Staff Productivity
Enable Employees to Generate
Greater Value
4 Invoice Exception Rate 22.6 % 10.7%
Touch-less Invoice Processing
Improve Payment Accuracy
5 Invoices Linked To PO 50 % 75% Improve Payment Accuracy
6 On-time Payments 60 – 80 % 80 – 99 %
Strengthen Vendor Relationships
Early Payment Discounts
Manage Cashflow
7
% of suppliers that submits invoices
electronically
24.9% 92% Touch-less Invoice Processing
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(Data Source: Ardent Partners’ Accounts Payable Metrics that Matter in 2020)

5. © Aavenir All rights reserved. 5
5 KPIs
For
Review
Accounts Payable
Automation
1. Invoice Lead Time
2. Processing Costs Per Invoice
3. Invoices Processed per FTE
4. Invoice Exception Rate
5. Invoices Linked To PO

6. KPI#1: Invoice Lead Time
Time from invoice receipts to ready for financial payments
How Automation Improves Invoice Lead Time?
• Automate invoice data entry and coding
• Automate matching of the invoice data with PO, Contract, and
GRNs
• Automate complex invoice approval workflow
• Reduce time for final review and post to Financial System/ ERP
Key Outcome:
• Faster Invoice Processing
• Competitive Payment Terms
• Improve Supplier Relationships
• Identify Bottlenecks
Industry Standards: 17 - 25 days
With Automation: upto 8.3 Days
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7. KPI#2: Processing Costs Per Invoice
Total average cost of processing one invoice
Total accounts payable costs / Total number of invoices processed
How to Automation Reduces Invoice Processing Costs?
• Reduce Direct Costs: data entry, employee, infrastructure costs
• Reduce Indirect Costs: exception handling, approval costs
• Reduce Hidden Costs: penalties, missed discounts, rebates,
duplicate payments, vendor rotation, cashflow issues, office
supplies
Key Outcome:
• Reduce Total Cost of AP Operations
Industry Standards: $10-30 per Invoice
With Automation: upto $3.34 per invoice
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8. KPI#3: Invoices Processed per FTE
The number of Invoices processed by AP Employee.
Total number of invoices processed / #no of FTEs in AP Department
How to Automation Increases #no of Invoices Processed per FTE?
• Identifies invoice patterns and continuous machine learning
• Identifies which suppliers cause you the most process
interruptions
• Identifies which employees face the most ad-hoc, unstructured
tasks
Key Outcome:
• Improve Staff Productivity
• Enable Employees to Generate Greater Value
Industry Standards: ~3000 – 5000 Invoices / month
With Automation: upto ~8000 – 20,000 or more Invoices / month
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9. KPI#4: Invoice Exception Rate
The percentage of invoices that require special handling,
approvals, workflows, or that contain errors.
How Automation Reduces Invoice Exception Rate?
• Touch-less invoice processing
• Increase number of invoice processed straight-through
• Reduce time spent correcting and managing invoice exceptions
Key Outcome:
• Fewer Invoice Bounce Rates, Re-entries, Re-keying and
Re-routing
• Improve Payment Accuracy
• Reduce Time and Resources to Process
Industry Standards: Avg. 20-25% across all Invoices
With Automation: Avg. 10.7 % or less across all Invoices
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10. KPI#5: Invoice Linked to PO
The percentage of invoices linked to a PO.
How Automation Helps to Link information of Invoice to PO ?
• Real-time analytics and Dashboards
• Increase number of invoice processed straight-through
Key Outcome:
• Fewer Duplicate payments, overpayments, and other wrong and
invalid payments
• Improve Payment Accuracy
• Stronger supplier relationship
Industry Standards: Avg. 60.5% of invoices linked to a PO.
With Automation: Avg. 73.3% or more of invoices linked to a PO.
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11. © Aavenir All rights reserved. 11
Aavenir
Accounts Payable
Automation (APA)
for ServiceNow

12. Approval & PayProcess
EMPLOYEES PROCUREMENTFINANCE IT
Accounts Payable Automation Workflow on ServiceNow
12
Validate
Onboard Data on ServiceNow
Identify Confidence Levels
Trigger A/P Workflow
>>>>>>>>
2-way/ 3-way Match
Business Approval
Integrate with ERP/ Payment
Aavenir Invoiceflow for ServiceNow
Submit
Send Non-PO / PO Invoice
Format : PDF/ JPEG
Single Email Alias / Folder
AI-enabled Data Extraction
Identify & Match Patterns
Extract Meaningful Data
>>>>>>>> >>>>>>>> >>>>>>>>
Supplier AI/ML Accounts Payable Finance / ERP
🡪 TECHNOLOGY 🡪 🡪 WORKFLOW / INTEGRATION 🡪

13. Calculate ROI
https://aavenir.com/accounts-payable-automation-roi-calculator/
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14. © Aavenir All rights reserved. 14
Resources to get started
ROI Calculator RFP Template Buyers Checklist
Request a Demo
Want to see Aavenir Invoiceflow Live-In-Action ?
www.aavenir.com

15. Onward and Upwards
with Aavenir!
Thank You !
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