Executive Spotlight: Nilay Banker, founder and CEO, Inspyrus

by Nilay Banker 0

Can you tell us about Inspyrus and the company’s role in the payments industry?

Inspyrus is a progressive fintech company based in the Silicon Valley that specializes in transforming Accounts Payable (AP) and Finance Operations into profit centers. Our passion and mission is to provide the most innovative, game-changing solutions on the market, and solve business problems that other providers have failed to address. Our solutions are used by some of the most esteemed brands and innovative companies in the world, spanning various industries, ERP systems and geographies—with production environments ranging from 2,500 invoices/month to over 250,000 invoices/month, across 30+ countries and 18+ languages.

Invoice automation has been around for a long time; why do companies still struggle to process payments in a timely manner?

Even after investing significantly in traditional AP automation solutions, most organizations are only realizing 20% automation in their invoice processing. This is a real head-scratcher; how in our current technology age, is it possible that AP is still experiencing such poor results? Part of the answer revolves around the fact that when it comes to invoice automation, “the devil is in the details.” Industry statistics show that over 80% of all invoices will have at least one exception. Exceptions are the bane of legacy invoice automation solutions which were originally conceptualized to eliminate paper and manual data entry. When an exception rears its ugly head, no amount of digital imaging or OCR technology will save the day.

Why? This can all be traced back to “legacy” invoice automation systems’ inherent lack of deep and real-time integration with the Enterprise Resource Processing (ERP) system of record. When I say “legacy,” I’m also referring to the current vendors on the market — because they all apply the same approach to invoice automation which has been around for decades. Here, the prevailing approach is to simply pass the buck over to the ERP system to identify and later resolve exceptions. Many vendors call this “integration”– where data is simply thrown over the fence to the ERP system, forcing manual exception processing work streams in the ERP system that are costly, time-consuming and error-prone.

At Inspyrus we like to think we’re reimagining invoice automation. From our perspective, this starts with only sending good quality data to the ERP system and integrating and interacting with the customer’s ERP system (or systems) in real-time. This allows us to eliminate exceptions as early as possible in the process — as opposed to passing the buck by sending over bad data for the ERP system to address. Resolving exceptions before invoices are vouchered in the ERP system eliminates unnecessary manual intervention, process latency, cost and complexity — delivering maximum automation for optimal results. Many of our customers are seeing up to 90% automation of AP operations and 3x the cost savings over legacy approaches.

You talk about Fintech innovation with AP. What technologies are driving the innovation?

Digital disruption is making way for new entrants and new models in the banking and financial services arena ala “fintech,” but corporate finance departments are also catching the fintech bug to innovate and streamline financial workflows and the financial supply chain for better, faster outcomes that empower both vendors and suppliers.

AP operations are in dire need of a major overhaul to meet today’s modern-day requirements as the current market approach to invoice automation and the associated digitization and OCR technologies have been around for over 30 years.

What we are doing is to challenge conventional business-as-usual thinking. Implementing incremental improvements to imaging or ERP system to make accounting more efficient is not innovation. For real change and innovation to occur, organizations must take a fundamentally new approach to invoice automation that breaks away from legacy technology and siloed solutions that merely image paper, collect data, and upload information to the ERP system.

Real improvements require real change – not just to physical business processes, but also in terms of process improvement thinking. This is a departure from incremental approaches and “group think,” but rather a reimagining of invoice automation and Finance operations as a whole. Given the pressure organizations are under today, they must take make bolder moves—if they truly want to move the needle. Again, we didn’t get electricity by making incremental improvements to the candle!

The building blocks that will fuel enterprise finance innovation include the cloud, mobile and analytics. The stumbling blocks that hamper it: Legacy systems (the average age of ERP solutions is 10 years old!), technology and processes. Cloud, mobile and advanced analytics are the key enabling technologies that make AP transformation not only possible, but much more accessible as well. These technologies allow next-generation AP solutions to deliver quicker results, dramatic reductions in complexity and more meaningful business insights than ever before.

Can you explain the concept of dynamic discounting and how it helps companies transform their accounting departments into profit centers?

While eliminating manual AP processes and reducing processing costs is essential for any organization, progressive CFOs, treasurers and other Finance professionals are beginning to understand the strategic value of also adopting new solutions to optimize cash management. The current low interest rate environment means that Finance must work harder and seek more innovative ways to drive greater returns on assets (and cash) to satisfy working capital needs.

We are giving today’s forward-thinking CFOs the tools to unleash savings far beyond those achieved solely with standard AP automation. These include dynamic discounting enabled through a platform that allows for suppliers to request early payments.

While dynamic discounting has been in existence for several years, today it’s fast becoming one of the key tools of today’s new breed of innovative CFOs who are discarding the old-school practice of sitting on cash and delaying payments, which has proven to deliver inadequate returns (not to mention dysfunctional supplier relationships) in today’s fast-moving and demanding economy. Instead, they’re leveraging dynamic discounting to forge ahead with disruptive approaches that make early-pay discounts a real source of cash — capturing up to 2% of corporate spend directly back the bottom line and optimizing cash management in real-time!

Arming the enterprise with the ability for suppliers to dynamically request early-pay discounts fundamentally changes the game, providing a win-win for both sides of the Procure-to-Pay value chain (fostering business enhancing relationships). It delivers the fastest payments to suppliers, while maximizing discount returns for customers — easily exceeding traditional (slow time-to-value) investment alternatives.

Of course to maximize the potential of this paradigm shift, dynamic discounting needs to be coupled with next-gen invoice automation to ensure companies capture every possible discount available. It’s this powerful combination that delivers the force multiplier necessary to turn Finance departments into profit centers.

What changes in the AP market do you expect to see this year?

In recent years we’ve seen many organizations moving Accounts Payable into a Shared Services model. In 2017, we’ll continue to see technologies and solutions that not only help organizations realize — and more importantly — accelerate this transition. Solutions that integrate to multiple ERP systems simultaneously and in real-time will be in high demand.

As well, we’ll continue to see modern companies leveraging dynamic discounting to redefine the role of Finance and gain a major advantage over competitors with a new, significant source of cash savings—one that frees them from the inherent risk associated with interest rates and market fluctuations. Progressive CFOs of these organizations will blaze the trail for the “new normal” in corporate Finance where the Accounting department is now a profit center.

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