CloudX Blog

Outlining Optimal AP Automation for Netsuite

Posted by Chris Cosgrove

Nov 18, 2019 11:53:28 AM





“The beginning is the most important part of the work.” 


That's what Plato said anyways....but, we tend to agree, however that most airline passengers are grateful for successful landings, so there’s that. Regardless of your position on whether the beginning or the end is the best, we want to get off to a good start with today’s post which is really about outlining what we believe is the optimal way to address AP automation for Netsuite users.


Now,  defining what AP automation actually means is necessary for a common understanding since it’s a broad topic and confusion over it can arise quickly. For the sake of today’s article AP automation as leveraging an advanced technology apparatus to address invoice presentment (how accounts payable invoices are received into a business) through their processing (approval process, 2 or 3 way matching, and GL coding) and ultimately ending in posting (entry into ERP or accounting system).  The payment process that comes after posting is also a prime candidate for AP automation but we like that idea that’s better couched as integrated payables. Here’s a deep dive on that, which will get you up to speed in a hurry.


Key points we need to address relating to AP automation for Netsuite.


Whichever approach you’re taking for automating invoice processing should follow a general course of action.  Invoices are received in numerous, different ways.  Some may be emailed, others hard copy via mail, still others via supplier portals, and for some legacy businesses, even fax.  Beyond that, there are file format considerations and we’ve seen them all...PDF, physical paper, Tiff, JPG, and XLS files are all part and parcel of the structures that AP departments have to deal with. 


Invoice Presentment - Optimal AP automation for Netsuite with respect to how invoices come in means being able to capably and swiftly address these multiple types of submissions in a cohesive, scalable, and powerful way that empowers the AP organization to capture all necessary data and leverage the data to good effect in advancing the invoice through the process.


This is best done through the use of advanced OCR (optical character recognition), whereby invoices can be categorized (Non-PO, PO 2 way, or even PO 3 way - with a receiver to match against).  Critical information can be parsed from each invoice depending on its type and that information can be used to drive the process forward automatically and without human intervention.

Free eBook on The 7 Best Practices To AP Automation!

Invoice Capture - One way or the other you need to get the data off the invoices if you’re going to end up posting them within Netsuite.  For people who haven’t automated they have to assign this task to their AP staff and in many cases have to scale up the staff to accommodate higher invoice volumes since it’s all predicated on data entry and manual validation steps (Vendor and PO lookups, line item matching, etc.)  From our perspective, this is wasted effort given how strong capture tech is these days. With near 98% level accuracy with advanced OCR at a character level, what is the gain in pursuing data entry? At the same time, most businesses aren’t interested in investing in or managing outlier technology that is expensive and requires special IT skills to administer.  So, from our perspective, what most businesses would do well to consider is partnering with a service provider that helps them get the outcome they want. In other words, sign up with someone that can deliver the invoices captured and clean on an ongoing basis, so you don’t have to get entangled in yet another system you have to pay big dollars to bring in and then have the benefit of managing.  Why not just pay for the outcome, especially if it’s a nominal ongoing, pass through expense that gets you immediate impacts?



Invoice Presentment within APSmart from CloudX

Data Integration - This may be the unsung hero of the bunch of items necessary for optimal AP automation for Netsuite.  Honestly, we can’t overstress the need for solid integration. From our perspective, the best approach with a system like Netsuite is facilitated through its Suitecloud developer environment where, because of its service oriented architecture, third parties can develop and integrate their apps in a consistent and scalable approach.  As such, when you have a tight integration (ideally via a dynamic API), especially in the AP realm you can do all sorts of wonderful things that otherwise would require manual effort that is costly, time consuming, and error prone.


Free Demo - Integrated Payables


Here’s a few things that can be expedited through tight data integration from an AP automation perspective for Netsuite:


-Vendor Validation - As invoices get submitted into the AP automation system for processing, vendors can be validated against the Netsuite vendor master file information to determine their accuracy and legitimacy. When valid vendors are identified, the invoice can continue forward in processing and where vendors detected in the capture stage that don’t reconcile against available, valid vendors in the master file, the invoice can shift into an exception state to be triaged by the accounting staff.  This is huge from a data cleansing and fraud detection standpoint and would otherwise only be possible by an operator doing manual entry reconciliation and lookups, both of which are cumbersome and a total drag on efficiency.


-General Ledger Coding - By exposing the various GL table data that exists within a Netsuite deployment and bringing that into your AP automation system of choice, you can do some interesting things.  For starters, you can overlay the approval process with a tighter set of controls so that relevant stakeholders (approvers) only see the GL codes that they need to access. This is helpful as it contributes to cleaner books and can eliminate fraud, while providing nice audit trails along the way as coding selections are evidenced by actor based data.  This obviously presumes some electronic workflow that drives the process, which is pretty much a standard feature for any end to end AP automation system.


-Purchase Order Matching - While Netsuite has latent capabilities to execute multi-way matching (the matching between purchase order data and invoice data, whether 2 way ie. PO vs Invoice, or 3 way ie. PO vs. Invoice vs. Receiver Document), if you don’t have an automation component driving the match, then Netsuite can only tap into the matching capability after the invoice or receiver data is brought in manually.  This is a bummer. However, optimal AP automation for Netsuite would include the PO matching because the data parsed through the Presentment and Capture steps above make the data available and usable in an automated way. Therefore, you can eliminate the need for manual matching in a high percentage of invoices. You can even overlay variance thresholds between these documents to tighten payment controls over your AP process.  Again, none of this is possible if you are stuck in an environment where you manually cranking away against data entry. But, with some advanced logic inside of an AP automation system for Netsuite you can easily pass along the ones that reconcile well and isolate the ones that have quantity and line item mismatches or that exceed permissible variances.  





Invoice Population within Netsuite of above referenced  invoice.

One key take-away as a higher order thought to transforming accounts payable is essentially this; beyond making AP efficient and empowering your staff to do more work in a faster fashion because of machine automation, there should be a fundamental elevation in the strategic nature and role of the accounts payable function, because the time savings and visibility associated with this AP automation initiative means your people will be freed up to pursue higher order tasks.  


This is why many corporate finance leaders who drive these kinds of projects forward will find themselves being able to pursue things like enhanced cost accounting or specialty projects, optimized vendor management initiatives, or pursuit of a more sophisticated payments strategy.  Obviously, if you’re mired by data entry and manual process, you’ll never get the upside of experiencing any of the meaningful uplifts in the nature of the work, because you’ll be perennially stuck in the weeds so to speak.


A few other things to think about with respect to AP Automation for Netsuite:


Beyond the obvious invoice processing elements we’ve already laid out, there are some more nuanced impacts of data visibility within AP that should never be overlooked.

For starters, the impacts of visibility and speed within the framework of optimal AP automation for Netsuite users (and really anyone implementing accounts payable transformation) should net out to actionability.  Realistically, if it’s not advancing your business and translating into concrete value, what’s it doing for you?


From our perspective here is what it could look like:


-Insight into pending payables - dashboards are really helpful this way, and more specifically having visibility into impact dates with respect to when invoices are paid.  The two predominant ways this flushes out is the invoice due date and dates for early payment discount deadlines. In the former, you can use the visibility and speed of the optimal AP automation for Netsuite to eliminate late payment issues and fees and in the latter you can use it to increase your early payment discount capture rates.  One is a defensive mechanism, the other enables your business to go on offense and to increase the strategic value of AP to the business in a tangible, monetary way.


-Reporting & retrieval - Being able to produce relevant AP documents, be they invoices, statements, credit memos, voucher / check request forms, and the audit trails for invoice and payment actions for every stakeholder in the process is crucial to ensuring the payables process has been structured in a way that is compliant with best practices and controls that are sound and justifiable to those responsible for corporate governance.  Additionally, being able to produce rich reporting that empowers your business to manage to key performance indicators is another factor for enhancing the performance of your AP department. Additionally, being able to have insight into vendor, workflow, and payment data will afford you the ability to get insights you may not have if the AP function is exclusively done in a manual way.


-Audit & vendor relations - By having a flexible, open platform that is collaborative in nature and that is integrated with your Netsuite instance, you’ll be able to empower third parties like your auditors or your vendors to have insight to the status of invoices and related AP documents, as well as provide the images as well.  This is important from establishing foundational understanding, especially when trying to troubleshoot or reconcile issues that may occur from a billing discrepancy or authorization perspective.

So we hope this was a helpful overview of some of the components that make up what we believe to be optimal AP automation for Netsuite.  We know implementing these can be tricky, but we encourage you to pursue it because of the huge value you’ll get once your process is optimized and automated.  If you’re looking for more intel on the best way to go about automating, check out this link below.


Free eBook on The 7 Best Practices To AP Automation!

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Topics: ap automation, netsuite

Is AP Automation Worth It?

Posted by Chris Cosgrove

Nov 8, 2017 2:59:36 PM

Is AP Automation worth it? Depends what your building...

Count the cost!


It’s always a good idea to determine whether something you’re thinking about doing is worthy of the effort.  I mean, who goes blindly into a venture without first counting the cost...that’s just dumb!  Could you actually imagine some engineers, architects, developers, and construction workers looking at each other at a skyscraper site and just shaking their heads saying I can’t believe we can’t finish...the beancounters say there’s no funds left.  It’s ludicrous, because that would never happen (except maybe for that hotel in Pyongyang, but hey).

Though most Accounts Payable professionals don’t have extensive building construction expertise it is not entirely dissimilar in that the question needs to be asked before beginning the lift in terms of process automation.  Though AP automation is definitely a known entity, it’s more involved than in bygone years, especially with the advent of numerous B2B payment rails.  The thrust of what we want to bring into view today though is really the measurement by which one could assess the prospects of AP automation and determine whether it would be worthwhile.

Three perspectives that need to be considered:

  1. Financial costs - Certainly any project has a financial cost consideration to take from inception to completion, like our building example above.  In many cases, the end result is something that may have an intangible value, though that won’t cut it in terms of assessing the viability of bringing AP automation to bear.  In fact, most organizations that have brought transformation to their Accounts Payable function have done so for precisely two reasons: a. They had a desire to do things more efficiently and they knew that was possible and b. They had the foresight to realize that an improved process would have the directly proportional effect of driving their costs down, and thus they would eventually achieve a break even and ultimately return on their investment.  This whole model is well and good, though new ePayments mechanisms like virtual card are tipping the apple cart though as they afford businesses the opportunity to monetize their payment stream and literally flip AP into a profit center virtually overnight.

  2. Opportunity costs - What does not automating this onerous process mean to your business? How is a poor or suboptimal process impeding your doing business with vendors and ultimately your supply chain? Is it creating error in your process that is then getting found out through internal and external audits?  What are the impacts on your people, and not just your back office AP staff, but how are your approvers engaging with this and how much is the effort requiring of them and what is their time worth.  What comes of doing nothing in terms of improving and maintaining the status quo?  All of these questions need to be posited and then you must taken an honest inventory of the responses before determining what matters most.

  3. Resource / political costs - Some hills are worth fighting for and others worth dying for, though not all are worthy of a fight.  If you know you don’t have the personnel to pull a project off, in some cases an honest assessment before getting started is what’s absolutely required.  In other cases political infighting can doom a project before it finds its feet.  For some companies, areas and projects are more siloed and competitive and as such, getting an initiative can be challenging to say the least.  Either way you need to count the costs in this respect and determine how much support you have and how much ack ack you have coming at you and what the best path forward is.

From our perspective, staying mired in inefficiency, waste, and limited visibility is an absolute non-option.  So, granted that we’re biased in this area, but we’re also unapologetic advocates for improvement where possible, and via cloud based AP automation virtually any business can benefit from an improved process and one that monetizes each transaction coming through and going out the doors so to speak!

Free eBook on AP Automation vs E-Invoicing:  What's Right For My Business?

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Topics: Accounts Payable Process, ap automation

Harnessing AI Via AP Automation

Posted by Chris Cosgrove

Nov 1, 2017 11:00:17 AM

Best AP Automation is AI powered!

Rise of the machines

There’s increasing buzz over the impact of AI (artificial intelligence) in the workplace.  With all the B2C impacts we’re seeing of late it’s with good reason.  Just consider how Alexa and all the Amazon devices, or Siri on iPhones, or the Google suite of products are changing how we do life at home and you’ll quickly grasp the pace and scope of the landmark changes in our world.  This is all well and good in our personal lives, and somewhat easier to comprehend, but the business implications of artificial intelligence in the back office can not be understated.  Sadly, many companies still don’t grasp how this technology can be leveraged in the here and now to create better business outcomes, reduce costs, improve cashflow, and drive profit, all in back office areas.

The primary way that AI is influencing AP automation would be three fold:

  1. OCR - It’s by no means a new technology, but one that has been changing and improving for a while.  OCR is now a highly reliable, trainable, adaptive technology that utilizes a machine learning engine to continuously improve in terms of accuracy and data throughput.  At a minimum, if you are in the data entry game in areas like Accounts Payable, this is a technology that can deliver a massive amount of value and should be on your roadmap to explore.  Granted, it’s not for everyone and typically only fairly large companies have successfully deployed it, but rest assured there are cloud and BPO models that can take your documents and data and run through an OCR engine with validation services to deliver high quality data back to you (and without breaking the bank).
  2. Workflow - Business Intelligence can be applied to drive documents or processes forward and this is a welcome change.  For anyone who has been trying to push approval processes forward and understands the challenge of doing this across a large or geographically dispersed organization, this is a definite win.  By applying your unique business rules to an electronic workflow, you can obtain the approvals needed to advance a transaction all while establishing a digital audit trail that can be tapped into later as a means of process visibility.  Various triggers can be used in conjunction with OCR so an AP automation system intelligently knows who and where to route invoices or transactions for human interaction.  Things like Address, Vendor Name, or Dollar Amounts can all be triggers for delegation or escalation and will help most businesses navigate even the most cumbersome of processes.
  3. Payments - Payment broker technology is a relatively newer development in the B2B landscape, but is a technology that can intelligently apply payment to your vendors based upon their preference.  This is massive for Payors as it enables them to push ePayment adoption and thereby advance their interests in terms of divesting themselves of traditional, onerous payment methods like Check.  Also, due the increasingly diverse set of B2B payment rails, it’s a welcome support to the AP staff that are otherwise responsible for executing payment transactions.  In today’s business climate, companies can pay via Check, Wire, ACH / EFT, credit cards, or virtual payments.  As such, having this technology that can intuitively offer payment according to the vendor’s preferred payment method, or one that can be designed to offer payment by the Payor’s preference as an initial offering and then default to a secondary method.

All of these are solid examples of the use of machine computing and intelligence to bring about positive wholesale operational benefits that come with a major financial upside.  If you haven’t explored these yet for your business it’s time to get serious and look into these for yourself to see where you might be missing out and learn what you can do about it!

Download The Four Keys To Maximizing The Strategic Value of Accounts Payable

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Topics: ap automation, artificial intelligence, ai

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