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Accounts Payable Software - The 12 Days of Christmas - Day 2 - Invoice Flexibility

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The 12 Days of Christmas - Accounts Payable Style - Inbound Invoice Flexibility

As we saw on the 1st day of Christmas, to make the Accounts Payable process as streamlined as possible, all of the physical paper-based invoices that come into an organization need to be converted to data at the outset of the process.  We addressed doing this via a physical scanner, MFD, or even through an outsourced service provider.  We also looked at situations where invoices may be received in a de-centralized environment.

Another underlying issue that needs to be addressed for many customers is the fact that thanks to advancing technology, invoices arrive in their AP departments by many formats.  Several noteworthy electronic formats include PDF (most typically e-mailed), Tiff (primarily faxed invoices & often printed out and treated as a typical invoice), and EDI.  The first two in this list are fairly obvious, but why, you might ask, does EDI have to be considered from a processing perspective.  While EDI is certainly the Utopian, gold-standard for invoice reconciliation efficiency, many organizations struggle with the ability to produce EDI transaction details when they attempt to retrieve them.  As such, any meaningful Accounts Payable improvement plan or Accounts Payable software overhaul, needs to have the ability to produce the transaction details in an imaged format.

The tip for this day is that any system that is deployed needs to be highly flexible. 

A robust AP system will allow for any of these various document types to flow into the process and enter a similar conversion flow.  After the conversion, the invoices will be driven based upon the classification that will occur of the document type, as we will see in tomorrow’s section.

One of the primary benefits of being able to electronically automate and process the processing of PDF & Tiff based invoices is that you can immediately eliminate the physical print, output, copy, and distribution of invoices in a traditional format.  While many companies have shifted their invoice submission to one of these electronic media formats, little has been done to impact the physical processing of the invoices if they are not converted to data.  To our thinking, what is the point of taking on PDF or Tiff invoices electronically if you are ultimately forced to print them just to carry on the process.  It seems a little nonsensical.  However, when you have flexibility to ingest these into a centralized capture process, you can eliminate the manual output and wasted effort.

Another important component to consider in your Accounts Payable software evaluation concerns electronic invoice submission for your suppliers. 

  1. By embracing the adoption of  a flexible solution to process these various invoice file types, you effectively deploy the framework for a self-serve supplier portal.  This is important for a couple reasons:By  getting your suppliers to submit electronically, they’ll be happier with not having to spend money and time to print and mail invoices to you.  At around $.50-.70 a pop for an invoice, this is no small amount especially for high – volume suppliers.  Also, this is environmentally friendly and will underscore any green initiatives you have underway internally.
  2. By converting the invoices to data and conditioning your suppliers to submit invoices via a vendor portal, you can help reduce some of the call load to your AP staff through the use of electronic document management technology to empower true vendor self-service.  Many AP managers are looking  for ways to free up their resources from the common questions suppliers ask…’where is my check/payment for invoice #xyz?’.

With this type of an approach in your Accounts payable process, you’ll have the flexibility to handle virtually any invoicing transaction that comes your way, preparing you for high levels of efficiency and process speed.

Check out our 7 Best Practices to AP Automation eBook here, with more in depth information on how to maximize your process speed and accuracy!

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