Build a Better Workflow: Practical Exercises for Finding the Right Payment Approval Solution

When your business receives an invoice, how do you know you are being billed correctly, or haven’t already paid the bill in the past? Does the person paying the bill consult Procurement to ensure the prices are correct, or the Receiving Department to validate receipt of goods and services? How long does it take to get approvals? After the payment is made, how easily can you access the audit trail and source documents to answer payment questions from a vendor or auditor? 

These scenarios reflect some of the business challenges that payment approval workflow (PAW) solutions are designed to address.

PAW solution providers offer a wide array of features and benefits. But what exactly does your business need? 

To answer those questions, you need to know what’s missing, inadequate, or can be improved with your process today. The exercises and questions in this post will help you determine: 

1. What is your current accounts payable / payment approval process?

2. What is your ideal approval process?

3. What do you need in a payment audit trail?

4. Next Steps in Building a Better Workflow

What is Your Current Accounts Payable / Payment Approval Process?

To establish a baseline of your existing approval and payment process, you should map out how your business processes bills into payments. Figure 1 shows an example payment approval workflow. 

 Figure 1. Example Payment Approval Process Map

 One person may not know all the intricacies of the process. It is a best practice to lay out the process with representative individuals involved in the process and the stakeholders. Questions to help you and your team outline the process are shown in Table 1. 

Table 1. Key Questions for Mapping Your Payment Approval Process

What is Your Ideal Approval Process?

After mapping your process, you can then consider what you would like to change. Identify gaps, missing steps, or inefficiencies in your process map. Append the questions in Table 1 with the words “in the ideal scenario”. The first question would be “In the ideal scenario, what type of would trigger an approval process?’

If you kept approval trails, review representative cases of payment errors and inefficiencies. For example, if payment delays hindered your business, examine the length of time between steps and determine if those are reasonable. Also ask:

• What gaps or inadequate approval policies make you vulnerable to fraud?

• Would automation, including mobile capabilities, close the gaps or streamline inefficiencies? 

• Would a better workflow alter those inefficiencies, and if so, what is preventing your adoption of a better workflow? 

• If the same group of approvers reviews all payment requests, is that necessary? Or would your business be comfortable instituting fewer or no approvers for bills below a certain amount? 

• If other business applications rely on the approvals captured in your PAW, would your process be expedited with full integration with the PAW?

Assess payment or approval mistakes — including inadvertent delayed payments, missed payments, and multiple payments — and their sources of the errors. What could have prevented those mistakes? 

• Would better access to supporting documentation have prevented those mistakes? 

• Would a different set of approvers have caught and rectified the errors? For example, does your PAW solution restrict you to selecting approvers from only one department, when you really need reviewers from several departments for more comprehensive scrutiny of payment requests?

• Would automated integration or syncs between your PAW solution and accounting software have prevented the errors?

If you have a PAW solution and are considering a replacement solution, ask yourself:

• Am I able to implement the workflow I need to run my business effectively?

• How easily can I configure the solution to my business needs? Can an administrator in my company make those changes, or must an application developer implement them?

• What combination of capabilities and cost would spur me to purchase a new solution?

If you do not have a PAW solution today and rely on a manual process, your ideal scenario may be automation. What are the critical steps that need to be automated, and what are nice-to-have automated steps? 

What do you need in a payment audit trail?

PAW solutions may offer payment audit trails that can be used for a number of reasons. Your lenders, investors, creditors, shareholders, auditors, and other local, state, and federal agencies may require you to furnish proof of internal controls. Business leaders may want documentation to evaluate and/or improve the effectiveness and efficiencies of your payment process. Identify all the business and regulatory requirements you must fulfill with your PAW solution. 

Next Steps in Building A Better Workflow

We recommend these additional resources as next steps to help you build or refine your payment approval process: 

1. Read our white paper, The Practical Guide to Payment Approval Workflows, which discusses key capabilities offered by PAW solutions, why they are important, and how the workflow engine in Bill.com delivers these capabilities.

2. Evaluate the fit of Bill.com to your approval policies and payment process through a risk-free trial. Our award-winning Customer Support team will ensure that you optimize you use of Bill.com.