xsuite automation accounts payable invoice [shutterstock: 1166732272, LookerStudio]
[shutterstock: 1166732272, LookerStudio]
Blog Finance

Taking Accounts Payable Invoice Automation To The Next Level

Many companies have already begun digitizing and automating their incoming invoice processing and are now contemplating their next steps. How can they further automate business processes in purchasing and accounting?

There are four key areas for action.

1. Standardize and automate upstream processes

Invoices with purchase-order references are quicker and easier to process than those without them. If all the necessary approvals for an invoice were granted during demand creation, no more approvals are required during invoice processing. This allows end-to-end automation, whereby the invoice is posted in the background. It also allows a three-way match to be performed, which increases protection from both errors and fraud.

So, issuing more invoices with purchase-order references (SAP MM) is an important step toward simplifying processes in accounts payable. This can best be achieved if the demand-creation process is simple, intuitive, and standardized across the purchasing department. A digital workflow for demand-creation and purchase order checking and release can be used for this purpose.

2. Using AI to increase automation

A digital workflow for processing incoming invoices (especially those that do not have purchase order references) can significantly reduce the workload of accounts-payable staff. The use of artificial intelligence in this context opens up entirely new fields of application for automation. These include self-learning data extraction, intelligent account assignment suggestions (which employees just have to choose from), and suggestion functions for finding the right person for processing as early as the validation stage. Predictive analytics, forecasting, and anomaly detection offer even more potential for automation.

3. Goodbye paper

Anyone who has automated invoice processing to some extent will know the sticking point: the greatest cause of error, the thing that tends to put the skids on automated processing, is the reading of data from scanned documents. However, document capture results can be dramatically improved by paying attention to a few important points. And, as mentioned above, artificial intelligence can help. Realistically, the error rate in document capture will probably never drop to zero percent; the aim is to minimize errors as much as possible. One thing is certain: the fewer paper invoices that arrive, the higher the level of automation and the fewer data entry errors there are.

One way to reduce the number of paper invoices you receive is to introduce a supplier portal. This ensures that all communication and document exchange with your suppliers is digital. The end-to-end digital process enables you to avoid the errors that can occur during digitization and the discontinuities that result from switching media.

4. Outsourcing to the cloud

When it comes to digital invoice processing, companies tend to focus on optimizing workflows. However, the backend also offers potential for optimization. For instance, some processes (or parts of processes) – especially those with a high volume – can be outsourced to the cloud. 

Instead of obtaining on-premises hardware and software for processes such as document capture and archiving, these can be deployed as services from the cloud. This is another way to boost automation, which is why many companies now use on-premises and cloud hybrid scenarios.

First digitize, then optimize

Processes in accounts payable have already been dramatically simplified by converting invoice processing from manual, paper-based workflows to digital ones. However, after workflows have been digitized, there are ways to further increase the degree of automation to maximize the touchless rate – in other words, the number of background postings for incoming invoices.

You can find more information on background postings here.

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About the author

Dina Haack, xSuite Group

Dina Haack is Product Marketing Manager of xSuite Group.

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