CloudX Blog

Free Accounts Payable Automation Tips: Rapid Invoice OnRamps

Posted by Chris Cosgrove

Jul 30, 2013 5:06:00 PM

 Get your Accounts Payable automation invoice on ramp up to speed!    

If you’re of legal age and have been driving for any length of time, it’s always a breath-taking scene when a throaty, European super car, punches the throttle down a high-way on-ramp.  Whether the powerplant is a straight set of large bore cylinders or if you hear the high pitched whine of accelerating turbos, either way, the outcome is typically the same…blast off in short order, while leaving many laggards agape at how someone could have the nerve to red-line their tachometer and leave them in the dust.  Accounts Payable automation is similar in this aspect, though in a strictly digital way.

 

Getting Your Accounts Payable process up to speed!

 

One of the key tenets of any successful Accounts Payable automation initiative is the outright necessity of having a flexible invoice onramp.  What do I mean?

I mean that invoices arrive in all shapes and sizes for the AP department to deal with and therefore, you have to be able to have a flexible approach to getting these into your process, especially if you’re leveraging an Advanced Capture OCR process.  The whole premise of Accounts Payable automation through OCR is the immediate conversion of invoices upon arrival through that costly and niche technology.  If invoices aren’t getting sucked into a processing engine effectively then it could mean a couple of things…they could be going into limbo (worst case),  or they could be getting keyed in by staff (slow, costly, and error prone), either way there is room for improvement.

 

So how do you craft your Accounts Payable process to perform like that European engineered thoroughbred above?

 

Deploy these onramps in your Accounts Payable automation effort:

 
  1. Identify a dedicated remit to for centralized invoice conversion – or partner with a service provider that monitors your inbound mail and converts all inbound invoice (credit memo, credit app, whatever…) documents to digital format as a service.

  2. Create a dedicated inbound Accounts Payable email account expressly for the purpose of giving your vendors a consistent plan of action for electronic invoice submission.   If you have invoices going to multiple AP staff, by going to a centralized, AP invoice receiving address, and feeding that to your processing engine, you can speed up the process, while eliminating individual chokepoints.

  3. Convert faxed invoices to digital and route via point #2.  Faxes are soon to be an obsolete technology, though it is amazing the level of entrenchment they have in various vertical fields, and most specifically healthcare.  To improve your Accounts Payable automation effort, make sure you have a service capable of converting faxes to Tiff/PDF instead of outputting to paper and auto-forward the inbound traffic to your dedicated AP email inbox for immediate processing.

  4. Improve Vendor Relations through a vendor portal.  Including your vendors in the AP process is key, and doing so can greatly help decrease inbound call traffic to your AP staff.  By giving your vendors access to their submitted, electronic invoice images, and by providing them visibility to where those invoices are at within your approval process is key to enhancing your vendor relationships.  Also, more advanced Vendor Portals in strong Accounts Payable automation suites allow advanced matching mechanisms against open Purchase Order data, greatly increasing auto 2-3 way matching accuracy.

  5. Create a record of EDI transactions.  Electronic Data Interchange is the gold-standard of P2P  integration the world over.  There’s a reason that best in class companies like Walmart rely upon EDI transactions for over 95% of their invoice transactions.  However, getting all vendors to adopt EDI is not a reality due to cost and technical resource issues around setting up live EDI connections.  Additionally, many companies struggle with the burden of mining out transaction details in a cogent and presentable format, so a good Accounts Payable automation package will enable you to produce an invoice image from an EDI transaction that can be used as a supporting document for that record.  Part of a comprehensive, and flexible invoice on ramp is having the technology in place to produce an EDI to invoice template.

 

For more information on how to improve your Accounts Payable process, and especially your invoice processing costs, check out the eBook below!

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Topics: Accounts Payable Automation, Invoice Processing, vendor portal, ap automation

Addressing Invoice Scanning in Accounts Payable Automation

Posted by Chris Cosgrove

May 28, 2013 1:26:00 PM

Yoda digs AP automation!

How do we scan (get) our invoices in the AP process?

 

We’re pretty sure this is not a question that Luke Skywalker posed to Yoda in the Dagoba swamps, but based on our experience it is largely subjective based upon your current technology investments and infrastructure and also the strategic direction you’d like to take your back office organization.  How so?  Well, scanning is definitely an additional step in the process of moving a transactional document like an AP invoice for those who are managing entirely manual processes.  (Meaning, if you’re not really willing to give an AP automation initiative the old college try, you’re probably better off leaving it in the manual state…you don’t want a Frankenstein hybrid of old and new parts, but rather, take the time to invest in a fully functional automation solution). From an outsider’s perspective it may seem unmeritorious because it adds additional labor effort and processing time, but the mitigating factor is that a quality scanned image can be largely converted to data via an Advanced OCR based capture process, making the scanning a necessary step to true process acceleration.  Without the OCR, scanning is largely done just to get rid of paper filing, but little gets done to improve the process.  While, that’s still a step in the right direction to living the paper-free back office dream, most companies would like to have their cake and eat it too by having the paper-free back office and without necessitating data entry or scanning.

So coming back to the strategic direction, a thought to consider is where is your company at in terms of establishing a Shared Services environment.  Most Enterprise level organizations have led the way in creating efficient, centralized processing and customer service centers that are focused to non-core areas like Accounts Payable, Accounts Receivable, Information Technology and many others.  In keeping with this type of approach these types of companies largely have investment dollars to fund the requisite hardware and infrastructure that is required to handle high volume transaction processing.  But many micro, small, and mid-size companies lack the human resources and financial capital needed to transform these types of processes.

 

Options for dealing with the paper:

 

  1. Invest in Scanners – Sure you may not be able to invest in production scanners, and you may not want to unless you can justify the expense against massive amounts of paper volume, but there are many mid range scanners that won’t pile on costs and can deliver solid results.  Check out some of the work-group range products from companies like Fujitsu.
  2. Leverage your Multi-function devices – This can be really helpful for anyone who has a decentralized organizational set up and more specifically for those with a broad geographic footprint.  One of the common themes that we’ve seen in the course of consulting with many retail businesses is that at the franchise or branch level, there is a predisposition to just Fedexing or using a courier to distribute invoices to AP for processing.  Those extra costs and time impacts need not be so deep in your business if you empower your front-line operations to communicate more harmoniously with the back-office teams via image capture at the point of origination.
  3. Document Process Outsourcing is an option – Using a 3rd party can help you improve the end to end process, and rather than embracing either of the two above approaches and having to invest in equipment, some parties are choosing to select a vendor to function as their partner in data conversion.  The simplest way to put is that the DPO (or BPO if you’re comfortable with turning all of your process keys over) provider has the front end conversion hardware, technology, expertise, and labor resources in place to make the front end issues of how to deal with the paper (at least for the Accounts Payable process) a snap.
  4. Deploy a Vendor Portal – You’ll be glad you did if you pull this off correctly.  By getting your vendors to submit their invoices electronically, you accomplish a few things: a. you get invoices uploaded to your process dynamically instead of waiting for the mail and having to scan yourself, b. you make the vendor happy by letting them participate in the process and monitor their invoice statuses, and c. you contribute to a healthier planet by nipping the paper in the bud upstream.

These are just a few ways to improve invoice processing in your organization and is by no means exhaustive.  Another alternative, as mentioned above is a full Business Process Outsourcing approach, though this is typically done by only the largest organizations, and with the understanding of ceding certain process contrls

 

To learn more about Accounts Payable software vs e-Invoicing and other Accounts Payable best practices check out our eBook below!

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Topics: Accounts Payable Automation, Improve Accounts Payable, Invoice Processing, accounts payable software, accounts payable best practices, vendor portal, document process outsourcing, ap automation

Managing Problem Vendors Through AP Automation Changes

Posted by Chris Cosgrove

Apr 29, 2013 9:50:00 AM

 AP Automation is as cool as Jesse Pinkman yo!

Yoooooo...Mr. White!

 

As we’ve discussed in this earlier post, change is difficult albeit necessary to improve.  No one likes going through a few hundred crunches, just go the gym around January 2nd every year, and you’ll see plenty of subject matter experts on this…we guarantee.  So how do you go about getting your vendors to embrace the changes that you create for them when you embrace a wholesale Accounts Payable automation initiative, especially one that integrates a vendor portal approach.  


We’ve repeatedly seen that certain vendors, and typically smaller organizations, can tend to be a bit more zealous to their approach to checking on transaction details and getting paid fat stacks (for all you Breaking Bad fans yoooooooo!).  But seriously, how do you help the problem children get over the hump of new technology adoption.  
Here’s a few of our thoughts:  

  1. Make your system easy to use.  This should be a pre-requisite for anyone attempting any level of software development or systems implementation.  However, it’s amazing that many software organizations do a fantastic job of making a simple process overly complex through confusing UI (user interface) and by doing so, blow their UX (user experience).  If you blow that….good luck getting them back on the bandwagon to use it again.  People have a short shelf life for being receptive to trying new technologies, so make sure however you present the system to them, that it doesn’t look like the  cockpit of an F-16.  From our perspective, by the way, the point of a vendor portal is to facilitate faster invoice processing through instantaneous invoice upload, as well as providing a search and retrieval component that is inclusive of the supplier so they can participate in the chain of custody of their invoice and unlike Mick Jagger get some satisfaction!
  2. Give your vendors options. Nobody likes being backed in between a rock and a hard place.  In sales that is typically called a hard-angle close, and it’s typically a tactic that is deployed to elicit an immediate action or decision by pitting two competing options against each other typically associated with some kind of time pressure.  Have you ever gone to buy a car and wondered how the mysterious promos that were being dangled in front of your face would all of a sudden vaporize from one day to the next…I mean c’mon they’re selling you a bucket of bolts for upwards of $20,000…you think they don’t want to make a deal…?  By the way…how did that approach to closing you make you feel? Pressured? Anxious? Frustrated? Perhaps…so don’t pay it forward to your suppliers when you introduce Accounts Payable software for automation that will help them.  Instead, create a welcoming, inclusive, message that lets them know that they can continue how they’re submitting you invoices (paper/email/EDI whatever) and if they want to upload through the portal  here are the bennies…capiche?
  3. Show them the way.   One step that is often overlooked is going beyond a clean UI.  In today’s hectic world, make it easier for your vendors to adopt the new way of doing business with you by providing training materials to get the adoption you’re looking for.  I can hardly think of anything that I purchase at this point in time that doesn’t get some serious investigation through blogs or optimally through YouTube.   This is really going beyond the status quo to delight your supplier base and make them raving fans of your new fangled approach, but ultimately it’s a win for both parties.  They can self-serve, and you can get them up off your back if they’re hounding your AP staff.
  4. Identify those willing to accept discounts.  This has been huge for many of our customers who are actively implementing or trying to increase their adoption of early payment discounts across their supplier base.  As a baseline, you can at least identify those who are willing to provide some favorable terms in exchange for faster payment, and certainly one of the tenets of AP software is that it expedites the end to end AP process.   Do this by offering up an opt-in option during their registration process and you’re good to go!  This can then auto trigger either your AP or Procurement staff to follow up on it with the supplier and then lock it down in terms of details.

In reality, you’ll never please everyone 100% of the time, but you certainly can provide a framework that is favorable to many and appeal to the masses.  The other item to consider is to be open minded to your vendors feedback.  They may provide some valuable ideas to making the entire experience better for everyone, and by being open-minded to it, you can find yourself enriching the relationship and improving your overall customer experience.  This is just another way you can appeal to a tough cookie and sell them on the advantages  to a new and different approach.  If at that point they don’t get it…keep calm and carry on!  The majority will and ultimately people will adopt as you get more and more traction…it’s that whole S curve thing we learned in Macroeconomics back in the day!

  
Til then, cut your teeth on other ways to cut your processing costs in our eBook Uncovering the 7 Costs to Process an Invoice and learn how to trim the fat out of your Accounts Payable process!

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Topics: Accounts Payable Process, Accounts Payable Automation, Invoice Processing, ap system, accounts payable software, vendor portal

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