In the continuous pursuit of business transformation, organizations consider accounts payable (AP) operation as a high-value target for innovation and automation. They need solutions that help them digitalize the AP process end-to-end, starting from invoice reception, data capture, coding, matching, approval, and payment.
Companies can choose from different types of solutions to increase the touchless invoice processing rate and lower the cost per invoice. Solutions that can help you handle exceptions easily will save you a lot of time, increase productivity, and allows you to focus on more business-critical tasks.
Microsoft Dynamics ERP solutions like D365 F&O, BC, AX, and NAV—each have their own way of handling the AP process, and most of them are gaining more features over time. For most finance departments, today, the basic features provided are not enough and would still require them to do a lot of manual work. That would lead to errors, high costs of invoice processing, and limited visibility in the whole process.
When we talk about AP Automation solutions for Microsoft Dynamics, there are two types to choose from—a built-in solution or best-of-breed application. At To-Increase, we have experience with both methods. Invoice Workflow is our built-in offering for AX/D365 F&O, while To-Increase MediusFlow is our best-of-breed AP automation solution for Microsoft Dynamics.
Built-in AP Automation
With a built-in (or embedded) AP Automation solution, you have the advantage of working in the same system with all users. You do not have to worry about additional user interfaces or integrations with external systems. However, these built-in solutions do not come with their own Optical Character Reader (OCR), Data Capture solution, which means that integration to such a solution would still be needed. Managing the whole process in a single system is, thus, not entirely the case, unless you decide not to work with OCR and make use of outsourced invoice scanning services instead. These solutions have tight integration with Microsoft Dynamics and use the business logic of the respective Microsoft Dynamics ERP solution.
Limited user experience
A disadvantage with a built-in solution is that the UI/UX is tied to the D365/AX logic, which might hinder the user experience for AP staff, reviewers, and approvers. Compared to most best-of-breed solutions, they are also not as advanced and feature-rich and do not have a purpose-based UI. They often require multi-click navigation and are restricted by the limitations of the standard Dynamics workflow. However, some people might like the fact that it is making use of the standard Dynamics workflow, since they are used to work with this workflow in other processes as well.
Keeping up with Microsoft updates
Next to that, version updates depend on Microsoft Dynamics updates. Almost every month, a new version is released as per the one-version release policy of Microsoft Dynamics 365. It can be challenging for built-in solutions to keep up with the Microsoft updates. Any change or customization needs to be thoroughly tested to make sure it works well in the next release.
Best-of-Breed AP Automation
Easy to use
Best-of-Breed AP automation solutions have the advantage of a purpose-based UI for AP users, resulting in fewer clicks and more ease-of-use. They come with flexible workflows, and many provide powerful reporting as well.
The level of automation is typically higher compared to a lot of built-in solutions, and most solutions have a large set of features that make the process smoother, user-friendlier, and more automatic.
Integration with other MS Dynamics ERP
A solution like To-Increase MediusFlow also adds a standard and certified integration with the different Microsoft Dynamics ERP solutions mentioned earlier in this blog, which utilizes master data and business rules within Microsoft Dynamics.
A disadvantage of best-of-breed solutions could be to work with two separate applications and UIs. Some would prefer to work in a UI that is purpose-based for AP, while others prefer to work in Microsoft Dynamics only.
Right vendor selection
Several vendors recommend integration with your ERP as they have experience doing this for a few of their customers. However, the maintenance of such integration is not always a priority, and they often lack knowledge about your ERP system as well.
An improperly integrated best-of-breed solution could be another disadvantage. This is something you should verify. You must make sure that the vendor has a proven and standard integration that covers your requirements and is updated in line with the Microsoft release policy of your Dynamics ERP system.
So, which approach would fit best for you?
Although it depends on your requirements and the particular results, let me help you by making it more specific.
Choose a built-in solution if your company:
- does not have complex requirements and thus does not need a very advanced solution
- prefers to do the invoice approval in Microsoft Dynamics, where you can work with a single UI (except for OCR/Data capture)
A built-in solution like To-Increase Invoice Workflow would be a great choice. When selecting such a built-in solution, make sure that it is out-of-the-box or allows making changes through configuration only. This is because customizations can result in a lot of hidden costs with every new update of Microsoft Dynamics.
Choose a best-of-breed solution if your company is looking to:
- achieve a highly optimized accounts payable with the highest level of automation
- have a splendidly integrated solution with Microsoft Dynamics.
A solution like To-Increase MediusFlow is an excellent choice for a best-of-breed solution. According to analyst research, MediusFlow is a leader when it comes to touchless invoice processing rates, time to process a single invoice, and invoice exception rate. No built-in solution in the market today (including To-Increase Invoice Workflow) achieves this level of automation.
It is important to note that the higher the level of automation, the lower the cost per invoice, which, in the end, can make a big difference on your bottom-line.
When selecting a best-of-breed solution, I strongly recommended going for a solution like To-Increase MediusFlow, where you have a certified and standard integration to Microsoft Dynamics. That way, you are relieved from a great deal of the high integration costs. As the impact of the integration package on Microsoft Dynamics is minimal, you can also avoid a lot of the (hidden) cost with every new update.
Several other factors could play a role in deciding whether you need a built-in or a best-of-breed AP automation solution. Here are a few to consider:
- Multi ERP
- Complexity of the approval structure
- Number of approvers that normally do not work in Microsoft Dynamics
Since we, at To-Increase, can offer you both scenarios and have extensive experience in the AP automation domain, we would be happy to discuss your situation and advise you on the most beneficial approach for your business.