Adopting LEAN Methodology in Accounts Payable

February 20, 2017

By Whitney Bronson-Smith, Sales Support Representative, Accounts Payable Solutions Consultant, Canon Information & Imaging Solutions

LEAN – the basic meaning of this term in business is to maximize customer value, while minimizing waste. As enterprises look to the future, one major focus is to drive efficiencies in an effort to create a more agile organizational structure. What does your roadmap look like?

Surveys of Finance and Business Management are showing that these initiatives are not necessarily centered on cost reduction, but on the ability to grow or increase value with the current resource and adapt to future business needs with improved control and visibility. Because of these needs, process improvement has increasingly come to the forefront as organizations increase their global footprint as well as adjust to millennials in the workforce and various technology innovations.

One improvement method, the Lean Process Improvement, which originated in manufacturing, has expanded to numerous industries and business processes as a way of thinking to drive efficiencies. To align a standard document-intensive process with Lean, the MPI Group identifies 4 steps: Plan, Do, Check, and Adjust. These steps become easy to implement in an organization by adopting imaging, automation and other business process management (BPM) technologies.

When we adopt this methodology to create a Lean Accounts Payable process we can not only reduce paper and manual steps, but create improvements across various process and resource areas. Canon USA has successfully applied these concepts with the implementation of CIIS’ AP Automation Solution in the Finance Department and continues to achieve additional efficiencies. With the AP solution implemented, our Finance team focuses on connecting workflows and people within an end-to-end Plan-Procure-Pay process, to further create value and reduce waste.

Transforming AP from a manual, paper-intensive process to a digital, automated process unlocks data and value to increase speed, improve talent utilization, remove waste, and simplify compliance and data governance, which are all improvement areas relating back to Lean. Below are examples of efficiencies the teams realized after the initial implementation of invoice automation:

Increased Speed:

  • Project Approval: Before 11 days  I  After 5 days
  • Requisition Invoice: Before 8 days  I  After 5 days

Talent Utilization:

  • 1 FTE AP Resource Per Year: Before 10,000 invoices  I  After 27,7000 invoices

In addition, Canon has seen a reduction in print and paper storage costs, further supporting our environmental initiatives, and cost management, such as taking advantage of supplier discounts. As Canon continues to look forward, we share our experience and expertise with our customers as we strive to solve their business problems with future focused solutions. If you would like to learn more about Lean processes, I encourage you to view our webinar on demand, “How Accounts Payable Benefits from Lean Processes", which further explores the connections between Lean and Accounts Payable.