AP Automation

In a new report issued by PayStream Advisors, one of the biggest back office challenges organizations face is the capture of both paper and emailed invoice data into their ERP. See PayStream Advisors: Invoice Approval Workflow Automation Report.

Unless the organization has invested heavily in EDI, many AP departments spend a lot of time and resources handling large invoice volumes from various suppliers – without an efficient way to get them into their ERP.

In most cases emailed invoices are printed out and then manually keyed in. Paper invoices are processed the same way. Manual errors are rampant and for companies that are growing this task can be a considerable challenge.

Trends in invoice scanning technology now make it possible to not only make emailed invoice input relatively painless, but much less arduous for paper invoices as well.

Emailed Invoices
Emailed invoices are sent in their various formats, which could be PDF, Excel, XML, Word, EDI, Tiff, or JPG to name a few. Intelligent capture technology uses A.I. and automation to identify who the supplier is, intuitively map the data fields, and make the data useful for input to the ERP. Once the system is set up, the supplier sends their invoice (in whichever format they choose) to an established email address. The technology processes the information and provides the data within minutes of receipt.

Paper Invoices
Paper invoices are scanned by Intelligent OCR that can extract all of the information necessary for invoice processing. The technology can detect who sent the invoice as well as capture all of the data fields that are essential for processing. The paper can be discarded and the invoice data is available for audits and archiving.

Scanning Invoices Into Accounts Payable – The New Age of Data Capture
Not only does technology exist to extract the essential data from both paper and emailed invoices, companies are taking advantage of the intelligence gathering abilities inherent in “line-level” invoice data. This means that organizations looking to improve their business processes can access data that can help them achieve measurable results.

Intelligent OCR seamlessly integrates with NetSuite, SAP Business One, SAP, Oracle E-Business Suite, Sage, Intacct, Dynamics, Infor, QAD and more.

To find out more about Intelligent OCR and Intelligent Capture with AI, click here.

Many of our customers struggle with their purchasing process.

This is because even though there are many stakeholders in the purchase cycle, actual responsibility and accountability can often be muddled.

This isn’t because the different roles in the organization are incompetent or at fault, but that in every organization and industry there is a real lack of transparency throughout various business processes. This is especially true in organizations that opt to use inefficient paper-based processes or when the company’s ERP is not capable of the flexibility required to support efficient workflows*

Whatever the case, organizations are looking to optimize the purchase process with a positive ROI and Request-to-Pay automation may be a great way to do just that.

The Request to Pay Process

With Request-to-Pay automation, everyone with a stake in the purchase is involved in the process, and the process is visible to everyone who plays a role. This high level of visibility actually supports accountability across all roles. Authorized stakeholders can actually see all relevant activity – changes made, when they took place and who made them.

Everyone from the person who makes the requests, to the approver who manages the budget, to the purchaser who makes the purchase, to the person who receives the goods, and to the accounts payable person who ensures payment – are part of the request to pay workflow.

This is what the automated Request to Pay looks like:

1. The requester completes a purchase requisition, and it is automatically routed for approval.
2. Once approved the system changes the requisition to a Purchase Order.
3. The approved PO is sent to the buyer who can now place the order.
4. Delivery of the product or service is made, and the goods or service receipt is recorded in the system.
5. The vendor sends an invoice for the product or service, and the system automatically matches the invoice to the PO and the goods receipt.
6. If there is an exception, it is automatically routed to the proper role for review and exception handling. The exception is in a complete information “packet” that holds an invoice image, the PO, the goods receipt, and notes.
7. If there is no exception, the invoice is automatically sent to the ERP for payment.
8. The vendor receives a payment and all of the payment details are recorded in the ERP.

Find out more about Request to Pay automation here.

*Most ERPs have rigid approval workflows, but not by design! (see “Invoice Approval Workflow Gets Flexible!“)

One of the best features of great budget software for enterprise is the ability to tie transactions together.  You can also monitor the actual budget amount used – useful as you process each piece of the transaction and for auditing purposes later.

So what does it look like?  The example below is based on the user having a specific GL account and department.

Keep in mind the user has the option to browse items that are approved for a specific budget AND/OR there are rules set on the item type to require a budget to be assigned AND/OR the administrator can leave the fields open for users to decide where assigning a budget is appropriate.

One of the key benefits of EchoVera’s Budget is being able to see the budget request, the requisitions, purchase order, delivery, and invoice – all as a complete package – for audit purposes.

For more information about EchoVera Budget, click here.

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Companies are digitally transforming their procurement and purchasing processes, and that includes software that helps them manage their CAPEX expenditures. This may include functions like approval workflow and document capture.

Where does CAPEX software make a key difference?

Specifically, CAPEX software allows companies to allocate a specific budget to a larger investment project and have visibility and control over the entire process. Some of the benefits include:

• Ease of delegation
  Workflow administration levels designate who can buy what within the organization. Built in alarm functions send out an alert when a set percent of a CAPEX budget is exceeded.
• The right suppliers, the right products
  By setting up delimitations for each supplier and product category, only preferred suppliers are used with defined product categories.
• Faster procurement process
  Purchase orders that match certain parameters are automatically approved. Invoices that match to the goods receipt can go immediately to the ERP for payment – bypassing manual handling and the resulting errors.
• More visibility 24/7
  Users can query information such as supplier name, budget request ID, status, the role of the approver in charge, product categories and requisition numbers. Purchase orders related to specific budget requests can be included in reports as well.

EchoVera CAPEX is a cloud-based solution that integrates with your ERP. Find out more here.

Businesses using Oracle E-Business Suite are discovering the value of using “intelligent” OCR to scan their invoices. It’s all part of a larger trend:

• With increasing invoice volumes, growing companies want to avoid adding to their headcount
• Newer OCR technology for data-extraction can be implemented with minimal I.T. involvement
• Businesses want to leverage the investment in their ERP with automation that provides a positive ROI

Invoices come in many different formats. Whether they are delivered in the mail and have to be manually handled, or sent by email in an electronic file format such as Word, Excel, PDF, EDI, and XML –  the data needs to be captured quickly and efficiently.

Traditional OCR is Outdated

Traditional OCR software has some constraints. For example, a company might receive an invoice by mail and scan it, but the data it collects is not available because of integration issues. Scanning could be avoided if the invoice comes by email, but in many cases the email invoice is printed out and the information is keyed into the ERP manually. Both of these methods are time and resource-intensive.

In the U.S., 89% of supplier invoices are in either paper or email format. 76% of companies surveyed input invoice data manually*.

For Oracle E Business Suite users who need to capture invoice data, Intelligent OCR intelligently captures all of the information needed – with 95% accuracy for paper invoices, and 100% accuracy for electronic formats.

Intelligent OCR uses A.I. and intelligent automation to extract data from any format of invoice, whether it was sent electronically or through the mail.

Intelligent OCR searches, interprets, validates, and extrapolates semantic meaning from any format or file type. It intuitively detects and learns each unique supplier invoice based on document layouts, including a tagging technology called Intellitags.

That means the manual data entry of invoice information into Oracle can be drastically reduced or eliminated. For more information, or to book a demo of Intelligent OCR for Oracle E Business Suite, click here.

*Source: Company revenues up to $100 Million – 2018 Guide to Payables Automation – Paystream

There are many constraints in the Dynamics ERP suites. This is especially evident in how user fees are structured,  and the lack of functionality around invoice approval workflow for Dynamics specifically.

User Costs for Invoice Approval Workflows

• Dynamics workflows are scripted, and that means using IT resources to create or modify them
• Customers must purchase Dynamics user licenses for requisitioners
• If the user touches two modules of Dynamics, such as Purchasing and GL, that can mean additional costs
• There is a user cost for coding – approvers must be licensed in the same way if they want to code an invoice (for G/L and AP)

Functionality Issues

• Without support for punch-out capabilities, PRICAT (Price/Sales Catalogue), or webshops users cannot access supplier catalogs or websites
• Users have to look at each line in order to determine a mismatch for Purchase Order matching
• Much manual legwork goes into finding the discrepancy, and the routing is limited by rules
• Accounting accruals take time and unrecorded liabilities become an issue
• Dynamics lacks an audit trail for the invoice approval process
• Business documents are not stored in an image repository for retrieval
• Data capture is a manual process in many cases, which is restrictive with large invoice volumes

Extending Dynamics Functionality

The good news is that it is possible to leverage your investment in Dynamics by using best-of-breed third party software that provides the functionality Dynamics is missing – with minimal involvement of valuable I.T resources. With the right application, you will have:

Reduced Costs

• Workflows are graphical and dynamic, allowing for ad hoc routing
• Software cost is based on invoice volumes, as opposed to number of users

Extended Functionality

• Users can access preferred online supplier catalogues
• PO matching is automated, and exceptions are sent to approvers on their laptop or mobile devices
• Shows invoice status in a central dashboard
• Creates an audit trail showing messages between users and suppliers as well as document images
• Has a document management system that allows you to not only store contracts and other relevant files, but allows you to put them into a workflow as well
• Have an automated data capture system that uses Artificial Intelligence to extract essential information from invoices, whether they are mailed in paper format or sent in email as a PDF, XML, EDI, Excel, Word or other format.

Find out more about the functionality in EchoVera’s AP automation solution for Dynamics here.

Procure to pay software can make a substantial impact on the digital transformation of your organization. It leverages the investment in your ERP and has a proven ROI for both cycle times and cost savings.

1. Makes 100% digitalisation possible
Organizations want to reduce their carbon footprint, and stop using paper. A paperless environment reduces the workload paper files and paper processes demand.

2. Expands the control of purchasing
A purchasing system with the ability to pre-approve orders reduces maverick spending. Collaboration between purchasing and finance makes for a successful ROI throughout the entire procure to pay process.

3. Dynamic discounting
By having an automated purchase requisition process, approval cycle times are reduced and dynamic discounting opportunities are optimized.

4. Cloud-based software
Because the capital outlay is minimal in comparison to on-premise, a cloud-based solution means fewer servers and staff requirements. You are not paying for the number of users, but actual invoice volume.

5. Connection to supplier web shops
Get punch-out capabilities to web shops or PRICAT (Price/Sales Catalog) support for the online catalogs of your suppliers.

6. Bird’s-eye view of the organization’s expenses
Leverage the data to get a 360º view of the organization’s expenses. Get supplier statistics such as volume and transactions. 
Identify bottlenecks in the organization from within a central dashboard.

7. User-friendly interface and workflow
Best of breed software is intuitive and user-friendly. Workflows are visually easy to manage and employees can do approvals or coding on desktop, tablets, and smartphones.

8. Tools for reports and KPI performance measurements
Because the digital environment is measurable, tools and reports can provide input into key KPIs that are determined at the outset and altered as the organization evolves.

9. Scalability
If you are experiencing tremendous growth, it is very easy to scale. You can increase your license size accordingly, and conversely downsize in cases of reduced volumes or seasonal fluctuations.

10. Security and protection 
Reputable cloud vendors have made the investment in the right people, tools, and appliances that keep data safe and compliance standards upheld.

See our video on How AP Automation Works here.

For more about how Intelligent Procure to Pay software with 95%+ recommend ratings can help your organization, click here.

What percentage of your company’s spend is under management?

For many companies surveyed, that percentage is under what should optimally be 100%.

Indirect spend is a big issue,  and it is something many organizations have not grappled with.

71% of organizations say they lack visibility with the non-contracted/non-sourced spend category, and 50% said that maverick spending is another big concern.

The cost of uncontrolled purchases

Controlling maverick spending is the challenge facing many organizations. Surveys show they are saying that maverick spending by individual managers or business units is front and center*.  

ERPs and the Technology Challenge

Purchasing modules in ERPs are designed for direct purchasing, but not for managing indirect spending – and here are some of the reasons why:

• Workflows are not flexible to match growing companies.
• Purchasing that is operational is driven by growth – with few control mechanisms in place.
• ERP modules for purchasing are complex and are directed by the “order-to-cash” cycle.
• ERP user licenses are costly, impacting broad-based deployment.
• Multiple versions of an ERP are common in large companies or organizations in different countries.
• Managing spend across many ERPs is not practical.

Ensuring a Successful Implementation of Purchase Requisition Automation

Consult each department to find out specifically what they need to consider a transaction successful. As an example:

• Purchasing has policies that dictate authorization levels required for approved purchases that have to be addressed.
• A safety department is required to be on an approval list for anything that involves their department.
• Accounts payable requires that there is a receipt and PO for the invoice being processed.

Build in controls that relieve you from monitoring
An example would be if a person needs to identify approver’s signatures and authorization amounts. This happens when people leave the company, are promoted, or are new to the organization.

Determine what back-end reporting you need. For example:

• Controllers who monitor spending in their area of responsibility may need to have the ability to drill down to the transaction in question.
• Maintenance may need a report on what a specific vendor brings into their facility.
• AP managers could access metrics on team performance, or have a more efficient and accurate accrual process.

Ensure you have the highest percentage of straight-through processing
If an invoice arrives that is lacking supporting documentation, there is a good chance it will have to go into an approval workflow to have someone look at it. By avoiding this manual process upfront, invoices can be processed in larger volumes automatically, avoiding human intervention altogether.

For more information on how you can empower your organization with automated purchase requisition automation, click here.

*Spend Matters