As a practicing legal professional, you’re probably always looking for ways to improve financial management and increase the efficiency of your law firm.
While you may have already considered digitizing some aspects of your practice, have you thought about automating your accounts payable processes? According to a recent Levvel Research survey, 50% of businesses are currently using accounts payable automation, and this figure is expected to rise. But what is accounts payable automation, and how can it benefit your law firm?
Let’s understand the benefits of accounts payable automation and how it can help you increase productivity and profitably for your law firm in 2023.
Who are the law firm’s vendors?
First, let us understand what type of vendors law firms deal with. This includes legal and operational service providers like:
Legal research providers –Companies that provide access to legal research databases and tools, such as LexisNexis or Westlaw.
Document management software providers – Companies that offer software for document management, such as NetDocuments or iManage.
Court reporting and deposition services – Providers of court reporting and deposition services for legal proceedings.
Litigation support providers – Companies that provide litigation support services such as eDiscovery, trial consulting, and electronic data management.
Legal staffing agencies – Companies that provide temporary or permanent staffing solutions for legal professionals, such as attorneys, paralegals, or legal secretaries.
Printing and mailing services – Businesses that print and mail legal documents and court filings.
Translation services – Companies that provide translation services for legal documents and communications.
IT support providers – Companies that offer IT support services, such as network management, data backup and recovery, and cybersecurity.
Financial and accounting services – Companies that provide accounting, bookkeeping, and financial services for law firms.
Marketing and advertising agencies – Companies that specialize in legal marketing and advertising, such as website design and search engine optimization (SEO) for law firms.
How can AP Automation streamline Law Firms Invoice system?
Compliance with company policies:
AP automation solutions play a crucial role in helping law firms strengthen compliance. By automating invoice processing, expense tracking, and payment workflows, these solutions ensure adherence to regulatory requirements. With features like automated approval workflows, real-time monitoring, and audit trails, law firms can maintain accurate records, prevent errors, and demonstrate financial transparency.
AP automation streamlines compliance efforts, reduces manual intervention, and enhances overall operational efficiency, enabling law firms to meet their compliance obligations effectively.
Faster approval processes:
According to a report by Aberdeen Group, the average time to process an invoice manually is 34.4 days.
The time it takes to process such invoices, from receipt to payment, can be significantly reduced with AP automation. The process can be completed in as little as three days.
This quick turnaround time can assist law firms in maintaining good vendor relationships, which can lead to better pricing and terms.
Increased vendor payment punctuality:
Law firms can use AP automation to ensure that their vendors are paid always on time. Late payments can strain vendor relationships and result in late fees or penalties. According to an Atradius report, 46% of US businesses reported that late payments had a significant impact on their cash flow. Law firms can avoid these issues by streamlining the payment process and ensuring timely payments with AP automation.
Employee Well-being:
Most invoice management tasks are clerical and mundane in nature, which does not induce creativity or critical thinking among the working employees working in the office.
In fact, a study by PwC mentioned how 69% of employees say they would be willing to take a pay cut if it meant having a job with more purpose.
Employees at law firms can benefit from AP automation by freeing up time from manual processing and allowing them to focus on higher-value tasks. This can result in increased job satisfaction and employee retention.
Simple expense and invoice management:
AP automation centralizes all invoice and expense data, making it simple to track and analyze expenses. This can assist law firms in identifying areas where they can cut costs and increase efficiency. According to a Levvel Research report, companies that use AP automation save 29% on invoice processing costs.
Reassignment of personnel to priority tasks:
The invoice process has generally been very personnel-intense in the past, however, this has changed since the AP automation
Thus, Law firms can use AP automation to free up staff from time-consuming manual tasks and allow them to focus on higher-priority tasks and prominent cases. This can lead to increased productivity and better product quality.
How to Implement Accounts Payable Automation in Your Law Firm
Implementing Accounts Payable (AP) automation in your law firm can be a straightforward process. Here are the steps you can take to get started:
Step 1: Define your requirements and goals
The first step in implementing accounts payable software is to define your requirements and goals. You need to identify the specific pain points in your current accounts payable process and determine what features you need in a software solution. This will help you find the right software that meets your needs.
Step 2: Research and compare software options
Once you have identified your requirements, you can start researching software options that match your needs. There are many software solutions available in the market, so it is essential to compare different options and evaluate their features, pricing, and user reviews.
Always choose a solution that can tailor its systems to your custom needs.
Step 3: Choose the right software
After comparing different options, you can choose the right software for your law firm. It is important to consider factors such as ease of use, integration with existing software, and scalability when making your decision.
A good AP automation software will assist your office in reducing the infamously large amount of paperwork that law firms are notorious for.
Step 4: Prepare your data
Before implementing the software, you need to prepare your data. This includes organizing your invoices, bills, and other financial documents, and uploading them into the software. You should also create a list of vendors and set up payment terms.
It must be noted that all
Step 5: Set up the software
Once you have prepared your data, you can start setting up the software. This includes configuring the software settings, adding users, and creating workflows for the approval and payment process.
Step 6: Train your staff
You must train your staff in how to use the software to ensure successful implementation. This includes showing them how to upload invoices, approve payments, and generate reports.
Step 7: Go live
You can use the software after completing the setup and training. It is critical to closely monitor the system during the initial days to identify any problems and ensure that everything is running smoothly.
Step 8: Regular auditing
Once the software is up and running, you should monitor it on a regular basis. You should continuously evaluate its performance and identify areas for improvement. A well-maintained and updated system is the key to a great AP automation implementation process.
The Future is Here: Embracing AP Automation for a More Productive Law Firms
Companies that embrace automation now will be the ones that thrive in the future. The legal landscape is rapidly changing, and those who are slow to adapt will fall behind. By investing in AP automation, you are not only improving your firm’s operations but also securing its future.
So don’t put it off any longer. Deploy AP automation for a more productive, profitable, and sustainable law firm. It’s time to take your legal practice to the next level and join the ranks of the most forward-thinking companies in the industry. The transformation has arrived, and you must seize it.
