An accounts payable automation ROI calculation is only useful if it survives being reviewed a year later, and most do not, because they count savings that were never available. The discipline is straightforward: include all the costs, count only the routine portion of the effort as addressable, and test the answer against a worse exception rate than you hope for. This page is how to build that calculation from your own figures, what to include on each side, and the one sensitivity worth running, because it is the variable that most often turns a strong case into a marginal one.
The cost side, in full
Licence, implementation, the internal time to configure and test, and the parallel-running month. The last two are routinely omitted and are frequently the larger half in a small business where the people doing the project are also doing the day job.
The saving side, restricted to what is addressable
Only the routine handling. On the worked example on this site, 400 invoices at three touches of six minutes with a 12% exception rate is 134.4 hours a month: $4,300.80 at a $32 loaded rate, $10.75 an invoice and $51,609.60 a year. The exception hours in that figure survive automation, so the addressable saving is the rest, discounted for the fact that automation is never complete.
The sensitivity that matters: the exception rate
Run the calculation at your current rate and at half again. If the case only works at the optimistic rate, it is a case for fixing purchase discipline first, which is cheaper and improves the automation case afterwards.
Questions people ask about accounts payable automation roi
Should we count faster payment discounts?
Only if you will actually take them, which requires cash and a decision. Counting discounts you have never taken is the commonest way these cases inflate.
What about headcount?
Be careful. At small scale automation usually changes what the time is spent on rather than removing a person, and a case resting on a reduction you will not make is a case that fails review.
Over what period?
Three years is conventional. Include the exit or renewal position at the end, since a licence is a recurring commitment rather than a purchase.