The Internet of Things (IoT) continues to unlock Industry 4.0 as the new reality of the digital-first enterprise. Through automation and availability of rich data, IoT has created new opportunities for organizations to optimize workflows reaching from supply chain coordination to mobile workforce management.
The pandemic has greatly accelerated the digitization of the enterprise, and with more professionals working from home permanently, middle-market and large corporates continue to invest in technologies to support remote workers and the demand for more agile operations in a volatile market.
But the embrace of the cloud and other complex technologies has created new pressures on the accounts payable (AP) department thanks to a surge in volume of complex invoices related to these digital-first services and products. Tellennium Founder, CEO and President Greg McIntyre said the result is a near-total loss of visibility into exactly what organizations are paying for. Speaking with PYMNTS, McIntyre explained why AP departments are struggling to obtain visibility into IoT and other technology-related expenses, and why outsourcing the invoice management, payment and reconciliation workflows can alleviate the AP pressure.
An IoT Evolution
The IoT revolution has been in the works for several years now as more organizations embrace digital platforms and connected devices that can consolidate the management of operations — and the data it generates — within the cloud.
For all of its benefits, this enterprise modernization push has created new challenges, particularly when it comes to invoice management and AP. Everything from the billing of phone lines, Bring Your Own Device (BYOD) programs, cloud and data services, and assets like routers combine to create a mountain of invoices, which are often recurring bills.
“All of your phone lines, phone numbers, internet circuits, cloud services, things of that nature — those invoices and billing workflows received at accounts payable are very complex,” noted McIntyre. “They don’t provide the details of what you’re paying for.”
Historically, a large enterprise that may receive anywhere from hundreds to thousands of IT and IoT-related invoices each month will be forced to log on to each supplier’s proprietary portal to pay for that bill. When it comes to reconciliation and spend management, these technology categories often get lumped together, meaning AP and finance teams merely have visibility into monthly payments.
This pain point created the rise of so-called telecom expense management, which evolved into technology expense management as organizations expanded their IT investments.
“The whole industry spawned to say, ‘We need something more than thousands of dollars listed as monthly charges,’” explained McIntyre, pointing to the importance of an organization to gain visibility into exactly what these charges are for.
Bridging The IT-AP Gap
While this pain point has existed for several years, McIntyre said the onset of the pandemic has intensified the complexities of invoices sent in via paper, PDFs and other means.
“Especially in the last year, everyone went remote,” he said, noting the recent surge in IT licensing billing that’s landed on the laps of AP teams. Solutions like Office 365 or Zoom each have different billing structures, with various pricing tiers based on how many employees an organization has or which features have been implemented. “If you have 10,000 or 100,000 employees, it adds up really quickly on a monthly basis.”
Obtaining visibility into line-item details ensures that the payments initiated to settle these invoices are accurate.
“The devil is in the details,” added McIntyre.
In an effort to elevate spend management capabilities in the wake of this surge in complexity, Tellennium this month announced the creation of its Management of Things (MoT) expense management platform. In addition to capturing granular data from these complex invoices, the solution can support the management of the actual payment as well as reconciliation, effectively outsourcing the AP workflow for this spend.
Breaking down silos is quickly emerging as a critical goal for organizations that need greater visibility into such a high volume of IT spend.
Through integrating into enterprise resource platforms (ERPs) and human resources platforms, for instance, McIntyre said spend management can strengthen the connection that exists between IT spend and human capital. For instance, when employees come and go, a change will inevitably occur as to which assets like mobile devices must be in operation. There will also be changes to charges from software suppliers that bill on a per-employee basis. Gaining visibility into HR means strengthening the ability to identify any discrepancies or missing savings opportunities.
Likewise, elevating technology spend management strategy also means bridging the gap between IT and AP, noted McIntyre. After all, the IT team’s investments in technology continue to drive the enterprise forward into the modernization age. By strengthening visibility into that spend, AP can play a role in digitization, ensuring fiscally responsible spend.
“We want to address the most complex, most difficult, most time-consuming pieces in an enterprise that fly under the radar,” he said. “And they shouldn’t — because it’s a lot of money.”
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