- Aug 8, 2018,
It might be difficult to remember, but not that long ago approvals in business were done on paper. You wrote out the request – maybe an expense report or a purchase order – walked down the hall to collect a series of signatures, then dropped the paperwork off in the accounting department. Then the physical paperwork was made obsolete by simply attaching requests and reports to an email. Hooray! Now instead of walking down the hall, employees could just send their request for approval over the internet.
Eventually the approvals process joined the modern day with suites of tools designed to not just expedite submitting requests and getting approvals, but also that tied into bookkeeping tools and other business software such as ERP, CRM, expense management and HCM.
But somewhere along the way the process became bloated, slow, and inefficient. New logins and passwords to remember for every system. New notifications to track. New systems to be integrated into other (often) slow and inefficient systems. Even worse, organizations the world over accepted these cumbersome processes as the best possible way to manage approvals. While other parts of their organizations thrived because of investments in technology, the approvals process remained stale and wildly inefficient.
We get it. There are other initiatives and priorities, other battles to be won both inside and outside the building. The problems that get solved in business are the ones where a true return on investment can be calculated. That means that, historically, most organizations have accepted frustration and aggravation as part of the approval process. While other systems and tools are integrated to help the business grow, approvals remain stuck in the dark ages, handled in a way that is neither efficient nor effective. But isn’t it time to shine a spotlight on what the true cost of an old-fashioned approval process really is?
The biggest problem in approvals is wasted time. If you were tasked with approving two purchase orders or two expense reports each year but each one took a week to complete, you’d most certainly throw up your hands in disbelief and start looking for a better way of doing things. But that isn’t how approvals work. Instead, the process of approving requests for time off, tickets, invoices, and purchases takes place a few minutes at a time. However, over weeks, months and years that time adds up in a big way. Our research shows that the average organization wastes over 11,000 hours per year on dealing with approvals. It’s not hard to recognize the financial impact that has when you includes all the approvers in your organization.
Additionally, that doesn’t even account for the time and energy wasted as the approver is pulled away from or interrupted while working on more mission-critical tasks. Talk about “death by a thousand paper cuts!” If companies truly understood the time their approval processes were wasting out of the valuable workday then that alone might spur them to action to solve the crisis.
Believe it or not, the approval process has financial ramifications as well. Aside from wasted time, approvals also have a real and tangible effect on the bottom line. For example, when an invoice isn’t approved in a timely manner the vendor might charge late fee penalties or modify your company’s credit terms. When a request for time-off approval isn’t done in a timely manner a second employee might have to be paid overtime to pick up the slack as a result of poor planning. When an expense report on a corporate card isn’t approved before the billing cycle ends, the issuer of credit collects greater interest. On and on. The delays and complications of the approval process create a financial impact that – as with wasted time – begins to grow unwieldy over time.
So what’s to be done?
The first thing that finance and IT departments should do when undergoing a digital transformation is examine where real gains can be made. It’s popular to integrate flashy new sales tools or big data processing solutions. And while those additions to the business can indeed pay dividends, we often see bigger gains when clients make improvements to less exciting areas of the business…areas like the approvals process. Furthermore, it’s critical that any changes or additions made as part of your digital transformation have real and quantifiable expectations. In other words, don’t just add new tools or solutions for the sake of just doing something. Which brings us to approvals…
Stop and think about how many approval systems you have in your current organization. Research shows that most enterprise-class organizations have up to a dozen different systems in place requiring approvals. This means that consolidation is a great way to save time and money. That said, consolidation doesn’t just mean reducing the number of systems and tools. To be frank, the idea of reducing tools and systems is often a non-starter and one of the key reasons that improvement in the approvals process stagnates. But what if organizations started to view approvals improvement in a different way? Consolidation can also mean improvements in how you interact with the systems and tools you already have in place. Think about it: ripping out a large system like Oracle or NetSuite simply isn’t very practical. Too much of your business is integrated with that system. That’s why you purchased it in the first place after all! But what if there were tools available that made managing, maintaining and operating those tools easier for everyone?
Bringing approvals to the modern age
At Capriza, we’ve built ApproveSimple to solve the problems with approvals in exactly that way. Instead of trying to change systems or modify the workflows, we’ve determined that a mobile-first approval process can be a huge time saver. And making that process fit your current request and approvals tool set is key. Instead of having to invest in a new tool or try to build your own system, ApproveSimple makes the most out of the investments you’ve already made by removing friction and aggravation across the organization. If you’re interested in learning more about how ApproveSimple can streamline your approvals process, contact us now. You’re wasting precious time and money when you don’t have to. We can help.