How “business as usual” in the back office hinders your digitization efforts
When it comes to digitization and modernization initiatives, most organizations tend to focus the bulk of their efforts on customer-facing activities like customer service and marketing communications.
Still, front-office systems and processes can only do so much. Back office employees may not directly interact with customers, but 60 percent of customer dissatisfaction can be traced back to ineffective support and administration in the back office, according to Capgemini.
So, why is everyone ignoring the back office? It’s pretty simple.
Every year, the ROI expectations on your technology investments increase. And the most straightforward way to prove that ROI is to invest in solutions that offer a direct 1:1 return on new deals. When an outcome can be traced back to an action, it’s easy to show the value of that action.
For example: supply chain disruptions. While organizations are already battling a challenging supply chain problem, the impacts can be disastrous when just one milestone is missed, especially if it’s early step in a long process.
Let’s say a bill for parts doesn’t get paid on time; due to lack of payment, the shipment of parts is delayed; then an entire product line isn’t built because it’s missing the parts it needs. The result? The product isn’t where it needs to be in time for the holiday season — all because someone in the back-office wasn’t aware they had a looming invoice deadline.
In this case, the ROI is clear: If the back-office team had the tools it needed to execute efficiently, the product would be where it needed to be, and annual profit goals would be within reach.
The more steps between the initial action and the eventual outcome, the harder it is to prove. But. That doesn’t make the initial action any less valuable. Often, the eventual outcome never would have happened without that long-ago push.
So when IT leaders go looking for the best ways to build new digital processes, increase productivity, reduce risk and realize fast ROI, they focus on solutions that show that a more immediate impact on revenue.
But in a lot of ways, that’s backward. Or at the very minimum, it’s missing a complete view of how your organization runs. The longer you let “hidden” departments operate with outdated processes, the more value you’re missing out on. Selling more only gives you a benefit at your profit margin, but every penny you save in the back-office hits the bottom line directly while making your organization more adaptable to change.
Why Back Office is Important
When you think about the modernization efforts that will make the largest impact on your forward-facing organizational efforts, think like Julie Andrews: Start at the very beginning (a very good place to start). The back office.
Imagine how that would affect your salespeople, your marketing department, your customer success team.
Now think about how things are done today.
Legacy technology platforms and information silos contribute to bottlenecks that slow down processes, sure, but the biggest contributor is “business as usual”: day-to-day, paper-based and manual tasks. This type of work not only leads to higher costs since it takes longer to complete — with a risk of error that leads to rework and additional costs — but it also keeps employees from pursuing other initiatives that add value to the organization.
Your back office employees and the tasks they’re responsible for are more valuable than the tedious processes they’re spending their time on. It’s impossible for your back office to work hard enough for their department to be anything but a cost center.
Now think about how you would build back office processes if you could start at the very beginning, without worrying about your legacy systems, where crucial corporate information is stored, and shaking the status quo.
You’d eliminate those manual processes — from the way information is captured as it enters your systems, to the way it routes to other systems, to the way it’s governed to compliance standards. You would build processes designed to save time and money, reduce errors, and create a better experience for employees, customers, vendors and partners.
60 percent of customer dissatisfaction can be traced back to ineffective support and administration in the back office
Back Office Automation: Make a Quick Impact
To transform your back office functions into strategic departments that focus on revenue-driving initiatives and organizational growth, the logical first step is to do away with inefficient processes.
But wait, we’re talking about jobs, right? Will automating these back-office functions make staff redundant?
Not at all. The right automation solution complements the back office, helping employees not only work more efficiently and productively, but also be more satisfied with their jobs. As a bonus, your organization not only grows faster — an intelligent automation strategy is key to growing smarter.
Getting automation right requires a strong focus on people strategies, transforming the business while maintaining an engaged, motivated and appropriately skilled workforce.
— EY report
Where to Begin Automating Business Workflows in the Back Office
Here’s another daunting piece: the back office isn’t a single team with a singular focus. So where’s the best place to get started?
We’ve identified the two back office departments where digitization will make the biggest impact: Accounts payable and human resources.
Instead of proactively getting ahead, AP is trying to catch up
With its unique insight into an organization’s cash flow, accounts payable (AP) can and should play a strategic role in the company’s operational efficiency and financial success.
But as long as AP departments continue to receive invoices in unstructured formats — like paper, emailed PDF or fax — manual data entry and inefficient processes will continue to be major challenges for AP departments.
When those processes are automated, though, your AP team can start focusing on things that will derive real value from their department — like contract negotiation, pending renewals and vendor usage value.
Instead of Focusing on People, HR Is Busy With Paperwork
It’s a similar story in another back office area, human resources (HR), where time-consuming paperwork take up a significant portion of the day. This leaves little time for HR staff to focus on the people who keep your organization running.
Instead of concentrating on hiring the best talent or driving great employee experiences that improve productivity and retention, HR professionals spend a lot of time on managing the many documents involved throughout the employee lifecycle.
Move past paper: Learn how to digitize HR so you can set up your team for long-term, far-reaching organizational impacts.
The Value of AP Automation
Imagine an efficient, streamlined AP function that’s not just about ensuring you receive and process invoices in a timely manner; it’s about optimizing the entire procure-to-pay lifecycle, freeing up working capital, and driving growth for the organization.
A main component of intelligent automation is intelligent data capture. This powerful tool allows you to capture invoices at the source — no matter what format they come in — eliminating the need for AP staff to manually enter information into the ERP.
Then, automatic workflows route invoices for approval, minimizing the number of touches per transaction and eliminating the risk of error. Workflow automation also empowers you to stay on top of the game and capture early payment discounts. And a seamless integration with your existing systems means users can instantly access related payment documents like receipts and packing slips from one screen.
Modernize Back Office HR Functions
Now it’s time to optimize human resources.
The right HR solutions eliminate risky and costly paper-based processes, provide easier access to employee files, streamline workflows and improve employee experiences. That’s important, because in today’s remote-work world, HR teams need to be able to work efficiently and securely from anywhere — sometimes without ever needing to step into the office to retrieve a document.
With electronic content management, case management, capture, and enterprise file sync and share capabilities, Hyland enables HR departments to eliminate paper, reduce risk, and ensure data security.The result? An empowered HR department that spends less time on paperwork and more time impacting every aspect of the employee experience, creating ripple effects throughout the entire organization.
In an increasingly digital-first world, you need to get your back-office functions moving forward, not backward. That means doing away with manual processes that drain efficiency.
But that doesn’t mean you need to overhaul the entire tech infrastructure. With automation solutions that seamlessly integrate with the ERP, HRIS and HCM systems that employees use every day, partnering with Hyland extends the value of your existing tech investment and ensures faster ROI and efficiency gains. Hyland’s enterprise integrations also eliminate the need to switch between screens to find the right information, leading to higher user adoption and satisfaction. Now that’s a win-win.
Get started today on your back office digital transformation in accounts payable and human resources.