Adam Larson: 00:05

Welcome back to Count Me In. I'm your host, Adam Larson. And today, I'm joined by John Rubinetti, president of b two b payments at Deluxe to talk about one of the hottest topics in finance, automation in accounts payable and accounts receivable. John brings a wealth of experience and some striking stats like the fact that 71% of mid market companies haven't automated their AP or AR losing valuable time each month. Together we explore why manual processes are still so widespread and the biggest barriers to automating and how to make the leap to more efficient systems even when your team or customers are used to the old ways.

Adam Larson: 00:41

We also cover what to look for in automation solutions that can grow with your business and handle whatever the future of payments might bring. If you're looking to modernize your finance processes and free up more time for what really matters, this episode is for you. Let's get started. Well, John, I'm really excited to have you on the podcast today. And today we're going be really focusing on AP accounts payable, accounts receivable and that automation.

Adam Larson: 01:09

And, you know, as our listeners know, they're all accountant, accounting and finance professionals. You know, it's essential for managing your company's cash flow for your financial health. It's like a liability. It's a list on your on your on your reports. And you got to you know, automation is super important.

Adam Larson: 01:24

And so maybe we could start a little bit about talking about why are we talking? Why is this a topic for a podcast, AP and AR automation?

John Rubinetti: 01:31

Yeah, look, from my perspective, right, I've been talking about this for the past year. We did some studies around mid market companies, right, and what percent have AP or AR automation. And the numbers were astounding. 71% of both. We did it for AR, we did it for AP.

John Rubinetti: 01:51

71% of mid market companies do not have an automated AP or AR. They are spending fourteen hours a month manually reconciled, into three or four different systems to pull information together. So when you talk about kind of why it's so important for them, cash flow, they're spending more time reconciling different payment types that they get and making payments than they are doing the things that they should be doing, which is better cash flow. Using the data better. Right.

John Rubinetti: 02:25

And so when I look at those statistics and when you take that fourteen hours a month, that's one month of productivity loss. So these are mid market companies. They need and cash flow is so important to them. I would much rather have them spend thirty days worth of looking at the, you know, making sure that they have the right negotiated payment terms with suppliers or, you know, are receiving payments the right way. Like that's where they should be spending time.

John Rubinetti: 02:55

So that's why for me, I've been talking about, everybody wants to talk about AI and everybody wants to talk about all the fancy things and real time payments and all of that. But I want to just talk about the basics because many of these mid market companies need the basics, just need to automate flows and have one place to go. And so at Deluxe, that's what we're trying to deliver. And that's what we have with our three sixty plus receivables platform and our DPX plus payments platform. So that's kind of why it's important to me.

Adam Larson: 03:27

It is super important. And you talked about like the fourteen hours, you know, that fourteen hours is it adds up, you know, as you mentioned, you know, so we're when we're we're looking at automation, obviously automation speeds things up, You know, which is great, which is wonderful. But, you know, how do you keep up with that, especially when you have to integrate with other systems? And there's there can be a lot of challenges going from checking four or five different systems to an automated type system. What is that?

Adam Larson: 03:52

What does that transition look like?

John Rubinetti: 03:55

Yeah. And I think when you think about speed, right? Speed isn't just about a faster transaction, right? It's about freeing up those finance folks to focus on the cash flow, the reducing errors, risk for the company. Right.

John Rubinetti: 04:11

And so, when I think about the integration there, it is the difference between what we'll say is looking digital versus actually being digital. Right. And so, you know, when you have a siloed ERP or, you know, the banking systems, right. That are disconnected, right. They're not part of the flow.

John Rubinetti: 04:33

Those are, that's where the pitfalls come. Right. And, and so, yes, you could use a new payment type, but if you don't have the following data, you don't have the ability to kind of match prior. And so when we think about, you know, we'll take receivables for a second or our three sixty plus platform. What that does is it pulls all of those different types, the payment types of credit card, this ACH, the wire, the check, which is a big big deal, right?

John Rubinetti: 05:04

You got still 40% of B2B is still check. And so when you can have one place to pull that in and for a finance person to focus there, that's the integration that you need. And we're trying to do it so that they don't have to. We just have one place to give them and everything kind of flows through there. So when we think about integration, we think about doing that for them.

John Rubinetti: 05:28

Same thing with our Payable solution. It just takes a file you know, from one of their systems and whether it's Intuit, right? Or, or or just takes the file, gets in there, makes the payments, takes it back in. And so it just makes it more seamless. So we're trying to offer a solution that already does that integration for them and has it so that they don't have to do it.

John Rubinetti: 05:51

Cause you're right. That integration piece is painful for them. They don't have the resources and the technology. So it's a cost. And so if we could do that for them and deliver a comprehensive solution to a mid market company, it's very beneficial to them because the implementation is not as complex.

Adam Larson: 06:08

So you talk a lot about the end state. When somebody gets to that point of they're integrated, they're going well and they can focus on the things they're supposed to focus on. Can you talk a lot a little bit what it's like when you work with organizations, when you're making that transition? How is it what is it like taking somebody who's so used to checking things, doing the paper checks, doing those things and trying to transition to that? Like how is it moving that system?

Adam Larson: 06:30

Because in today's day and age, some of us hear that and probably like what people are still using checks. But as you said, 40%, I've talked to other AP people and they're like, yeah, a lot of people are still using checks and we got to get out of that. But What's it like making that transition and how can you prepare teams for that?

John Rubinetti: 06:44

Yeah, you know, and when I talk to my folks, about how to set up that initial call, right? It's it's, you know, when you're talking to an AP or an AR person, you know, they're thinking in their mind that their job's in jeopardy. And I totally get it. I spent a number of years as a consultant, so I understand when you walk in, people go, they're on edge, they're not maybe as transparent. And so, when we talk to the CFO, right.

John Rubinetti: 07:13

Or, in some of the smaller companies, maybe it's not a big team, right. But it is still a team. And when you talk about what the benefits are and you're transparent about what really they could be doing versus all those manual things and make them feel part of the process and part of helping the process because, you know, the goal shouldn't be to just remove people because now you have an easy automated system. You still need those folks. Finance brains, right?

John Rubinetti: 07:41

And the schooling and the training that they go through, there's a reason for it. Now I love my CFO. She's fantastic because she thinks the way I don't. Right? And she helps me.

John Rubinetti: 07:51

And so these folks are valuable, but you need to make sure that they're part of the process and feel like there's you're you're improving their life. Right? And their stuff so that they could do more for the company. And that, that sounds like a cliche, but honestly, no mid market company wants to, you know, rid of people. They want to just optimize people because they know they need the work.

John Rubinetti: 08:14

They know they have intellectual capital, about the business and the years of doing it. But getting them to kind of be on the same page is, is, is important. And part of the discovery process will call it, I like to call it a sales process. We're not trying to sell you anything. We're trying to help your business.

Adam Larson: 08:33

So it was like the cough was like, I was like, I was like trying to see if it was going to come and then I'm going take a sip of water here.

John Rubinetti: 08:39

I

Adam Larson: 08:40

think that's great advice, except she bringing the right stakeholders in, especially when you're working on a project like this, because the folks who've been doing the paper checks have been doing the manual work. They know the process inside and out so they can look at an automated system. So, well, actually we're missing this part. How do we get that in crew or in there? And that that input is so valuable, especially when you're implementing a new system like that.

John Rubinetti: 09:02

Well, and it also helps when you do implement it because, you know, as opposed to them holding back some of that stuff, but you're right. They know the ins and outs. They know, you know, Sally from this company is going to call them, right? Yeah. Like they know And what she's going to ask, she's going to say, I need this information.

John Rubinetti: 09:20

Well, if we can make it so that she sees that, we both sides. And I talked about on another one, creating what I call a win win win. It's a win for the company, but it's also a win for the supplier or your payer, whoever it is. If there's good communication there and good understanding of what they need and what you need. I always say if we sell something to a company, but they don't really take into consideration how their payers or how their suppliers utilize it, well, then we're only fixing part of the process because there's still going to be pain there.

John Rubinetti: 09:56

And so that's why when we like to do that, we like to talk about the whole process. Talk about your relationship with the suppliers, talk about your payment terms and what you're trying to do because then you can start to understand you're not just solving your issues, but they may be calling you for a couple times a month and they're asking for the same information if you could affect. So that's the kind of stuff where those folks, that's why I say those folks are so valuable because you're right. They know this process inside and out. So

Adam Larson: 10:26

speaking of them knowing their customers really well, what about if you have customers who are resistant, who are saying, I only want to do paper checks till, you know, this I'm insisting this is what I have to do, but in a modern world, you know, can those things coexist still? Like how can that still work?

John Rubinetti: 10:40

Yeah, it's funny because you know, again, I, everybody wants to talk about real time payments and not being a better payment, you know, and automa own digitizing the payment. Well, if you don't digitize the supplemental information that's needed to reconcile and to get the exceptions, you're really only digitizing part of the process. So I like to kind of talk to those folks to say, look, first thing we got to do is identify the manual gaps, identify where you touch it. Don't worry about the payment type first. Just let's talk about what you do, how you receive it and where it goes.

John Rubinetti: 11:20

Because the reason checks are still utilized so much is because of the supplemental data, right? Like when it's through a lockbox, you have that access, so you have it there. Right. And so it may not just be about getting rid of checks. It's just about, can you get the same data and the same flow and be able to manage exceptions by utilizing other payment types?

John Rubinetti: 11:43

And from our perspective, yes, we are the 110 old original check company. So we don't want to see checks leave tomorrow. They're not going to, but we also want to help our customers. We want to control that flow to say, Hey, we have a tool that if you do ACH, we can pull in that data so you can match it up sooner. Same thing with card, right?

John Rubinetti: 12:06

So we're creating a tool based on kind of what we know about the check flow process and why remittance data is so important. And we're then utilizing it in a way to pull in all the other payment types. And then we could say, Hey, if you want to reduce checks, here's the way to do it because you want to push them to the other payment types that you already received. And it can be, you you can utilize the system to check exceptions first, right. And do matching and those kinds of things automated.

John Rubinetti: 12:33

So you're not picking up and looking at three different spreadsheets to try to match payments or pull an email that has, you know, the remittance data from the card payment. Right? Those are things that that flow is so important. So it's less about this specific payment type because we enable all those rails and pull them into one place to automate the process, not just the payment. Gotcha.

John Rubinetti: 13:00

That's what I like thinking about.

Adam Larson: 13:03

Yeah. Because it's like some people will still want to use that and they have automated ways to send checks that it almost feels like it's it's digital, but it's like everything feels automated. But some people have that system and it works well for them. And so you want to be able to be able to take all those types of payments and still automate your side of it as much as possible. Right.

Adam Larson: 13:23

Exactly. It's alright. Sorry. Just need to get my thoughts because I realized I'm like, after I coughed, was like, wait, I just lost my train of thought. And so I'm like, okay, where was I thinking about going?

Adam Larson: 13:32

And that's the worst when

John Rubinetti: 13:33

you're in

Adam Larson: 13:33

the middle of a conversation, but we'll get it. Actually, this is all right. So we talked about integration. We kind of were touching on like the digital modernization kind of topic a little bit, right? We were talking about that.

Adam Larson: 13:45

You know, so we've talked about, you know, getting your system automated and the importance of that and how and how how you can still coexist with some, you know, older techniques, but you can still bring it all into an automatization and you can still bring it to a nice, you know, automation ecosystem within your platform, within your within your within your tech stack to make sure that it flows really nicely, you know? And so I think I think all those I think we've kind of outlined that. But as we're looking at, you know, that question is not working. Okay, sorry. I don't know.

Adam Larson: 14:17

Okay, what do you mean by modern payment rails in that document they sent me? Because I feel like I'm not saying something like, I I feel like I wasn't framing the question right to talk about modern payment rails.

John Rubinetti: 14:27

Okay. So they were kinda saying what steps should businesses take to truly optimize modern payment rails like RTP? Kind of what I was saying earlier. Right? Yeah.

John Rubinetti: 14:37

We're not, we, you know, Deluxe, we're not about, you know, keeping payment types out. Right? So we want all the modern payment types. We want

Adam Larson: 14:47

make sure

John Rubinetti: 14:47

is that the flow of the supporting data, the reconciliation piece, right? The things that have to be matched in order to go. Like, that's where for us, you know, we standardize across all the different, rails. All right. I get it.

Adam Larson: 15:07

I understand. Yeah, that makes sense now. All right. For some reason it wasn't clicking in

John Rubinetti: 15:11

my head again. I knew

Adam Larson: 15:12

what the question wasn't quite framing right. But now I know I, now I can know where to go. Okay.

John Rubinetti: 15:17

Yeah. Good. And I always say like, that's why I say like, everybody wants to talk about fast, real time payments and fed now and all of those things. But if, if you're just introducing a new way to pay and another system that you got to go in and it's not fully integrated into the tool, it doesn't matter. Right?

John Rubinetti: 15:38

Yeah. So that's, that's kind of how that's why we'd like to think about it differently. Yeah. All right. All right.

Adam Larson: 15:44

I get it. That makes sense. Okay. You know, we've covered the importance of automation and how important it is to integrate it within your systems and, you know, and how gosh, why is my I'll start one more time. Sorry.

Adam Larson: 15:57

It's just it's that day. This is like I'm traveling starting tomorrow for business and like there's a lot of things and I'm like, I got to focus in and I'm here. I'm here with you, John. I know you are. So we focused a lot on the importance of how automation will work will will revolutionize how you work within internal systems.

Adam Larson: 16:14

But as as technology continues to change in advance, as there's many different payment options go out there, you know, I'm sure someday businesses will come to you and say, hey, can I pay this invoice with Bitcoin or whatever whatever newest thing is out there, you know, businesses? Yeah, exactly. How can businesses really kind of be prepared for for those types of questions, especially when you have an automation service and process? But then maybe there's a new system and like, hey, it doesn't integrate properly. There's so many different situations and examples I'm sure we could give.

John Rubinetti: 16:44

Yeah. Well, and look, I think payment is a space that everybody's trying to get into, right? If fintechs out there offer types of automation and trying to help businesses, Right? And they're trying to direct them honestly to payment types that work better for them. Right?

John Rubinetti: 17:01

At Deluxe, we don't think about it that way. We think about kind of modernizing and automating all the rails into one place to to allow for, you know, the automation of the process, not just the payment piece. And so, you know, when we talk to customers about what this solution is and they say, well, what about this? What about Bitcoin? What about all the newer types?

John Rubinetti: 17:26

What's next? Well, we're we've built a platform to easily be able to add different payment types into our flow. So we're thinking ahead. We thought ahead about our solution because our solution is this modern stack technology that allows for easy integration with APIs. And so we've built it to be able to say, okay, we have these things today.

John Rubinetti: 17:51

Well, tomorrow there's three new ones. We have an easy way to pull them in. So what my advice to businesses out there and folks in the AP and AR is look for a more comprehensive solution, a solution that can help grow with you and grow with the changing times. Many things just kind of solve the problem right there, but let's move all your payments to card so that you can get, you know, points and those kinds of things. That's great.

John Rubinetti: 18:20

But at some point you look at that and go, that's a little bit expensive for me as a mid market company. Maybe there's a better way. Maybe there's a cheaper way. And, you know, I'm not looking at charging by the time we're, we do it differently. And so when you think about this type of solution that fits within what you have today, but is also scalable for tomorrow.

John Rubinetti: 18:42

That's how we think about our solution, both of them. And so, you know, they they they're meant to solve for your needs, not my needs. You being the customer.

Adam Larson: 18:54

Yes. Yeah. I like that, you know, looking for a solution that really can grow with you. And as I'm as I was as you were saying that, it made me it made me want to kind of just pick your brain a little bit. You know, if somebody is listening to this conversation, they're like, you know what?

Adam Larson: 19:07

We don't have a lot of automation or AR. This is something I want to look into. You know, obviously they could look at Deluxe, but, you know, if they want to you know, a lot of times you can't just look at just one company. You got to look at others. What are some questions you should be asking the AR automation company that, you know, that really can kind of get to the nitty gritty of what they should be looking for?

Adam Larson: 19:26

What are some things they should be looking for in organizations when they're looking at possible companies?

John Rubinetti: 19:30

Solutions. They're, you know, first thing you kind of don't want something just sitting on your platform that then has to be upgraded, right? So you want to think about something that's neutral kind of sit, you know, lot of people talk about the cloud. There's a lot of things happening in the cloud, but, you know, a solution that is there where I can update it, I can add those enhancements, I can make tweaks to it so that I don't have to push them to you and you have to do them. So you want something that allows you the flexibility to add and grow.

John Rubinetti: 20:06

You got to remember these technologies are new. They're changing so quickly. So you kind of take something in into your environment, just the updating, the cost, the tech resources. So you want something that minimal implementation, minimal tech costs, minimal ongoing costs. So those are things that I would highly recommend that you ask those questions about and then ask about the roadmap.

John Rubinetti: 20:33

What do we, what do you see as next? I'm happy to talk about real time payments and Bitcoin and stablecoin and all the rest of them. Because as a payments company, that's what we're thinking about. We're not just thinking about, well, we were merchant services provider and a check provider. So we only think about those two payment types.

John Rubinetti: 20:50

We think about them all and we have to because that's the solution that we want to provide. Right. And we want to provide it to our partners, like our bank partners that sell our products, to, to their customers and we sell direct. So that's the way we think about it. But that's what I would highly recommend to someone if you're if you're asking about a solution, make sure it's it's not something you have to load on, you have to maintain, you have to update and and upgrade and and because that's where they get you.

John Rubinetti: 21:19

They want those additional costs so, you know, they can monetize everything going forward. We don't think about it that way.

Adam Larson: 21:27

Yeah. Are there ways that you can internally prepare your team before you start an automation project?

John Rubinetti: 21:32

Yes, absolutely. I think, you know, pitfalls that I've seen, right, are where you don't really have that kind of kickoff meeting as a team to say, let's identify all of our manual processes. What are we doing? Sal, tell me what you do, right? Or Ben, tell me what you do every day and where they could say, well, I take in this file, I have to go find the email receipt for this.

John Rubinetti: 22:03

Cause when you get everything on the table and you start to put plot and say, oh wow, we have five systems we go in. It's actually not three, it's five. And we have a check process that we get some good data, but is it in the, have that session, have that session that says, let's identify all the things that we're doing that we know we can do more efficiently. Then start asking your question. What would you do with that time?

John Rubinetti: 22:30

Right. If you had some data, if you had some insight into how you got paid, who paid you, what time they paid you, and you could start saying, oh, I can increase my DSO or decrease. And you can then start to work on those and have better relationships with your suppliers. And so if you map out kind of what are the manual processes, what are the things that you'd like to spend more time doing for the company? And then how do you bring that all together?

John Rubinetti: 23:00

That's that to me are the pitfalls. People miss that piece. Right. Maybe the CFO says, Hey, I saw a great demo or spoke to my banker and they gave me, they told me they can help automate. Okay.

John Rubinetti: 23:11

Well, what are you automating first? And bankers would, you know, they might be a little bit pushy this to say, Hey, I can, course we know that I know my solution works for everybody. Right. I know it does. But you got to get them to kind of make sure they recognize it's there.

John Rubinetti: 23:27

And when you do that, that's when people go, wow, I really do. Many people haven't plotted their time to say, wow, I do spend fourteen hours a month. Right? Like they just do, like you said, machines because they know how to get this stuff done to make their month end quarter end. Right.

John Rubinetti: 23:48

Bringing those folks together, and really understanding what the processes are before you go try to automate them.

Adam Larson: 23:55

Is that, that sounds like sound advice for any, any anywhere within your organization, whether it's APAR, whether it's you're looking at ERP systems or looking at how you budget, you know, do that process because have a chance you have a chance to look at all your processes and find, hey, is there a better way to do this? Can we save time regardless of whether we're automating something or not? It's very like it's something that we should all be doing just in everyday life, really.

John Rubinetti: 24:22

Yeah. And most midsize companies, it's hard for them because they are I mean, they're they're they're not they're not overly staffed. They're skeleton crew. And so to take a step back, maybe they could only do it on a Saturday. But you know what?

John Rubinetti: 24:40

Maybe that is what you need to do just to get a view because you get to see like they're jack of all trades. They're like, they're doing multiple things. And so they don't have that second to step back and, you know, say, you know what, let me look at how I do this. And so any one of these companies, to fix it.

Adam Larson: 25:17

When we were preparing for this, this conversation, you know, one thing that we were talking about is like modern tools versus adopting modern thinking. And I figured it'd be a nice, like kind of way to kind of wrap up our conversation and be maybe talk about the difference between those and why it's important.

John Rubinetti: 25:30

Yeah. So, you know, when you talk in the industry, right, people talk about kind of tools and automation tools don't automate, right? It's the thinking that transforms. So kind of what I just spoke about, right? Which is stepping back and thinking about your process, getting your people to think about what they do and how they could do more effectively.

John Rubinetti: 25:55

And here's the thing, there's so many things in today's environments, right? How people, you know, people never want, you know, like I said, they were never gonna not walk into a bank and do what they, you know, do their banking because that was just something that they did. Well, all of a sudden that's changed and now there's easier ways to do that. So people are adopting changing ways. You just have to kind of bring them back to think about that.

John Rubinetti: 26:17

Because modern finance is about shifting from the task execution to the decision enablement side of it. That's what we're trying to do at Modern Finance, is really help them not just do what they do to get stuff done, but really how do they do it and how insights into that can help them. And so it's a mindset shift. And as I said, in a mid market company, it's difficult because you got people doing multiple jobs or part time, they're part time AR, part time AP. So, they're just doing stuff you know, to get, keep the business running, to get the payment in the door, right, to get cash flow.

John Rubinetti: 27:01

But, you know, I think getting the CFOs to get their teams to think like that, getting the folks in AP and AR, there's better ways. How do we utilize the data better? Is there something out there that helps integrate AI? Yes, there is. We actually have it.

John Rubinetti: 27:19

Getting them to acknowledge that, getting that mind shift to that modern thinking of what's, what's modern finance really to a mid sized company and it's insights and you got to get there.

Adam Larson: 27:33

Yeah. And sometimes the smaller organizations take a little bit longer to get to that more modern thinking because they're just set in their ways. What's working is working and they don't want to they don't want to mess it up. But sometimes you fall behind if you keep doing what's always worked.

John Rubinetti: 27:46

Yes. Because again, how fast this technology, right. And the advancements are changing. You used to be able to get away with that because you can keep doing that for a period of time, but because it's changing so fast, you know, you could be left behind now. That's, that's worrisome.

John Rubinetti: 28:04

And again, for someone who grew up with small businesses and mid market companies that are the backbone of this country, you want them to thrive. You want them to succeed. And so there is a lot of manual process that they could get away with. They can't go on forward. And so they don't want to be left behind.

Adam Larson: 28:24

They really don't. Well, John, it's been an absolute pleasure having you on the podcast and chatting about this.

Adam Larson: 28:29

I hope our audience has gotten as much out of it as I have. And just thank you so much for coming on.

John Rubinetti: 28:34

Thanks, Adam. Appreciate it. Thanks for having me.

Announcer: 28:37

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