AP automation is to digitize all stages of invoice processing using software, in order to reach a full automated accounts payable workflow in a company. Main task is to make the process error-free and fast, minimizing human intervention through software. Although frequently confused with invoice automation, AP automation is a broader concept containing RPA applications, ERP integration, smart archive, payment systems etc.
Who Benefits from AP Automation Most?
Regardless of the size of your company, you can benefit from AP automation. Companies operating in fast changing environments, multi-national companies, start-ups who need to keep up with latest regulations, companies who need to improve digital transformation maturity are more likely to benefit most.
Why to Automate Accounts Payable?
AP automation has so many direct and indirect advantages that, it is difficult to choose the most significant ones. Let’s try anyway:
- Reducing costs and saving time.
- Boosting employee satisfaction and letting them focusing on tasks adding real value.
- Reducing errors and duplications that is inherent in manual data entry.
- Increasing transparency and better control over spend management.
- Improving policy compliance and vendor management.
Talking on reducing costs, we can give some numbers. According to an IOFM report, cost of processing an invoice manually is between $10- $23. It shouldn’t be hard for a finance manager to calculate how large amounts can be saved by automated accounts payable operations.
How Does AP Automation Work?
AP automation software starts working with collecting invoices from various resources. It can listen an e-mail inbox or watch a local folder, which is used as a repository of incoming invoices.
On the following step, invoice content is converted into searchable and editable digital data by OCR. It is crucial to keep in mind that, OCR is an image to text conversion technology and it needs to be powered by AI features to be useful for accounts payable automation. For, OCR is a rule/template-based technology and therefore is unable to extract data accurately from variable invoices.
Just as onVision AP automation solution does, any advanced ap automation solution has to develop self-learning and self-adapting AI. So that, system can keep working autonomously regardless of variable invoice layouts or low quality/noisy documents.
Next level is the customization of AP process according to your business rules and workflows.
Finally, data is to be delivered to ERP or any other core systems. This is integration step and it is important to choose an AP automation solution which offers ERP connectors such as SAP, MS Dynamics etc.