A digital approval workflow allows businesses to streamline documentation processes and ensures the right people are approving requests. But an approval workflow doesn’t necessarily operate efficiently in practice.
By carrying out an audit, organizations will have a better understanding of how their approval process is operating. This will allow you to identify any inefficiencies in your approval process.
What is a Digital Approval Workflow Audit?
It is a structured process to review your digital approval processes. It can help identify whether you are making sure requests are being approved correctly and efficiently.
It can also help you identify any redundant processes, delays, missing documentation and lack of ownership. A typical digital approval workflow audit will look at:
Whether your approval workflow is structured, Who is responsible for approving requests, Whether requests are being approved efficiently, Are there any documents in place to document the process, Is there an audit trail, Are sensitive documents only being accessed by authorized users and can managers see how approvals are happening.
The aim is not to look for errors in your process but understand how your process is operating and whether it is meeting your operational requirements.
Why Should Businesses Audit Their Digital Approval Workflow?
Regular audits will help ensure your approval process is running efficiently.
- Identify Bottlenecks
One of the most common issues with an approval workflow is requests getting stuck in limbo as nobody has approved them. By carrying out an audit you can identify where delays are happening and whether certain stages are causing unnecessary delays.
For example, purchase requests may need to go through 3 managers when they just require 1 or 2.
2.Ownership
Every approval should have an owner. If you don’t have clear owners it can cause confusion amongst staff members as they won’t know who should be approving a document.
By carrying out an audit you can identify whether every stage has an owner and whether decisions are being documented.
3.Documentation & Audit Trail
You need to ensure you have reliable documentation in place for any important decisions. An approval audit trail should include all the relevant details such as the request, supporting documents, who approved, time stamps, comments and what the outcome was.
Having this information will make it easier to review previous decisions and identify any discrepancies. Structured approval processes will make it more useful for you than emails.
4.Reduce Manual Processes
By carrying out an audit you can identify any repetitive processes. For example, staff may be manually sending requests, sending reminders and updating spreadsheets.
This will help you identify which processes you can automate.
5.Ensure Standards are Being Maintained
Different departments may have different approval standards. This can lead to inconsistencies in decisions.
By reviewing your approval workflows you can ensure they are operating using standard processes. Whilst still allowing specific requirements for different types of requests.
How to Carry Out the Audit
A successful audit should cover the whole approval process.
- Document your current approval process To begin with you should document how your current approvals are operating. Think about:
- Where are they being requested from?
- Who is approving?
- How are decisions being communicated?
- What happens once they have been approved or rejected?
For example, a purchase approval may follow this process:
Request has been made by an employee -> Reviewed by the department manager -> Checked by the Finance team for budget-> Final approval by Senior Manager -> Decision has been received by employee.
Make a note of all the different stages, including any manual processes and how information is being communicated. This will help you to identify if there is a structured process in place.
- Who is Approving?
Ensure everyone has an owner for each approval.
Ask yourself:
- Who is requesting?
- Who is doing the initial review?
- Who is giving final approval?
- Are approvals tied to roles?
- Are there any backups in place if someone isn’t available?
- Can employees approve outside of their authority?
Having approval tied to roles will help stop any disruption to your workflow if employees change roles.
- Approval Rules
Ensure you have rules in place for where requests are going.
Are approvals in the correct order for the type of document? Some processes may require sequential approvals whilst others may be able to have multiple people reviewing at once.
Are there any extra approvals being triggered based on criteria?
For example, purchase value, type of document or risk.
Having a clear structure will help reduce any unnecessary approvals.
- How Long is it Taking to Approve?
Review how long requests are taking to go through each approval stage.
Look for any patterns such as: Requests remaining pending for a few days, Repeated follow-up from employees, Approval stages always causing delays, Requests being sent back due to missing information, Unnecessary review steps.
Useful metrics to track include average approval time, number of requests in limbo, rejection rate and the number of times requests have been revised.
This will help you identify if delays are caused by the approval workflow, unclear ownership or incomplete submissions.
- Audit Trail
A good digital approval workflow should have a clear audit trail.
Check whether you have:
Name of requester and submission date, Details of request, Supporting documents, Names/roles of approvers, Approval/rejection, Time stamps, Comments, Reassignments, escalations and status, Final approval.
Ensure users can view previous versions of documents. Your audit trail should give enough information so you can see what happened during the approval process.
- Security
Approval workflows often include confidential financial, operational and business information. Therefore you should review your security.
Check If: Employees can only see relevant information, Approvals are in line with organizational authority, Sensitive documents are secure, Previous employees/inactive accounts have the correct restrictions, Important actions are being documented, Backup processes are in place.
You should also ensure your processes are in line with any internal policies and legal/regulatory requirements.
- Review Notifications
Notifications will help your approvers know when they need to do something. However, if they aren’t managed well it can cause unnecessary communication.
During your audit check whether notifications being sent at the right point and pending requests are being escalated.
For example, if a manager isn’t responding within the set time frame the request can be sent to an authorized backup approver.
See if your notification settings useful, deadlines are realistic and escalation rules are clearly communicated.
- Staff Feedback
Those who use the approval process regularly can provide useful feedback on any issues.
Ask your team members whether the process is easy to understand,
or requests are often delayed, whether they experience having issues accessing documents?
Compare this to your workflow data.
- Document Issues & Improvement Plan
Once you have completed your audit you should split your findings into 3 categories:
Critical issues – Security issues, unauthorized approvals, missing documentation or important compliance requirements.
Operational issues – Delays, lack of ownership, continual requests for information and unnecessary approvals.
Improvement Opportunities – Better reporting, automated reminders, simpler forms and improved integration.
Ensure each issue has an owner and set a realistic timeframe for resolving. Prioritize any issues based on how much they could impact your organization.
Conclusion
Carrying out a digital approval workflow audit will help you understand whether your approval process is efficient, secure and has good ownership. By reviewing your approval stages, ownership, documentation, audit trail and performance you can identify any issues.
Using a audit checklist will help make the process easier to manage. You should also review real examples of approvals, ask for staff feedback and create an improvement plan.
Most importantly you should regularly carry out audits. This will help ensure you have consistent approvals, reduce delays and create adaptable workflows.
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