It may seem obvious: cumbersome B2B processes are bad, while streamlined workflows are good.
But the reality of embracing digital transformation and automation across back office operations is a little more nuanced, and even challenging, than it may first seem.
Still, with the news Tuesday (Aug. 27) that Vault released new functionality for its accounts payable (AP) platform to help Canadian businesses automate vendor payments, adopting new payments technologies to remain competitive is top of mind for both B2B buyers and suppliers.
B2B payments have traditionally been a slow and cumbersome process, often involving paper checks, lengthy approval cycles and complex reconciliation procedures. The introduction of digital payments, automation and even artificial intelligence (AI) into the B2B space promises to streamline these processes, offering faster transaction times, better visibility and more accurate data management.
Yet, the complexity of B2B transactions — due to factors like regulatory compliance, diverse payment methods and the need for robust security — means that simply adopting new technology is not enough. Businesses must also manage the change process effectively to realize the full potential of these innovations.
Read more: Building Better B2B Relationships Through Payments Innovation
Change management refers to the structured approach an organization takes to transition individuals, teams and the company as a whole from the current state to a desired future state.
In the context of B2B payments innovations, this involves preparing, equipping and supporting employees as they adopt new technologies and processes. Against today’s backdrop, where many companies are hunting for cost-cutting opportunities, change management is crucial.
“B2B payments haven’t evolved much from the modalities that dominated the landscape 40 or even 50 years ago,” Boost Payment Solutions Chief Operating Officer Illya Shell told PYMNTS. “Traditionally, payments were an afterthought, but modernizing global B2B payments is an enormous opportunity … Much of what’s left is really hampered by rigid and inflexible systems.”
One of the primary roles of change management is ensuring that the adoption of new payment technologies aligns with the overall strategic goals of the business. This involves a thorough assessment of how the innovation will impact various aspects of the organization, including cash flow, supplier relationships and customer satisfaction.
By aligning the adoption of new payment methods with broader business objectives, companies can ensure that the change delivers tangible benefits and supports long-term growth. For example, PYMNTS Intelligence has found that nearly three in four firms (73%) say that AP automation improves their cash flow.
Read more: 4 Questions for CFOs About AP and AR Automation
Optimized B2B payments have the potential to improve working capital, supplier relationships and overall supply chain efficiency. But one of the main concerns when adopting new technologies is the potential for disruption to business operations.
Poorly managed transitions can lead to downtime, errors and frustration among employees and business partners. Effective change management minimizes these risks by planning the implementation process carefully, testing new systems before they go live and providing support to address issues that arise. This helps to ensure a smooth transition with minimal disruption to daily operations.
In an interview posted July 31, Ernest Rolfson, founder and CEO of Finexio, argued that the shift to digital payments is not just about adopting new technologies, but also about changing organizational mindsets and demonstrating the courage to innovate and achieve a paperless operation.
As PYMNTS has covered, to stay competitive, businesses need to leverage data and continually optimize their processes — but frequently, just getting a sense of what’s working and what isn’t is a stumbling block that many businesses don’t have the resources to overcome. That’s because much of a B2B organizations’ time and energy is already being spent maintaining their legacy AP programs, which are laden with manual tasks, such as writing paper checks and reconciling payments.
As for what the best advice to move forward is?
“Automate, automate, automate,” Lorenzo Soriano de Teresa, senior vice president, merchant services at American Express, told PYMNTS in an interview posted Tuesday (Aug. 27). “The right automation solution, or the right partner, can help businesses move past their current payments concerns to see tangible benefits.”
Change management doesn’t end once a new payment system is in place. Continuous improvement is a key component of successful technology adoption. This involves regularly reviewing the performance of the new system, gathering feedback from users and making necessary adjustments to optimize performance. By fostering a culture of continuous improvement, businesses can ensure that they continue to reap the benefits of B2B payments innovations over the long term.
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The post The Importance of Change Management in Unlocking B2B Payments Innovation appeared first on PYMNTS.com.
