What is invoice automation in the RPA World?
RPA does all the magic in Invoice automation process,that allows straight through processing (no human interaction) most of the time for the entire invoice process. Invoice automation involves. Invoice automation (also known as automated invoice processing) is a growing area of automation with narrow implementation risks and significant benefits. Invoice automation would free up back office finance/procurement teams to focus on higher value added tasks.
- Monitoring for invoices: Invoices arrive in companies as PDFs, image files and gradually rarely as hard copy documents.
- For digital invoices, an RPA tool can flag emails with invoices and forward them for data extraction. Some companies use a devoted email address for invoices to further shorten invoice monitoring.
- For hard-copy invoices, companies are converting to using a single address to centralize invoice scanning
- Invoice capture: Extracting relevant details from the invoice. If the software does not have confidence in the results, it is sent to employees for a manual check.
- Evaluating invoice against order records and other criteria to guarantee that the payment is indeed a valid one. Evaluations include
- cross-checking invoice against purchase orders
- cross-checking invoice for duplicity
- using working capital optimization policies to decide payment time
- Using limits to decide whether to manually process invoices. Invoices that are oddly large compared to a suppliers’ usual invoices may need to be manually proved to ensure that wrong payments are not done
- recording invoice-related information in systems
- making the necessary payment to settle the invoice
All steps except invoice capture are rule-based processes. However, invoice capture relies on machine learning to extract the data in the invoice.
Before automation, back-office teams would
- Look at invoices, understand the relevant data in the invoice
- Input it to the relevant systems so payments and system records would be complete
- Team would notice irregularities in the invoice and contact the supplier or the ordering team to resolve the issues.
What are the benefits of RPA in invoice automation?
Benefits include of RPA includes
- Reduced invoice processing expenses
- Increased focus on activities with higher value add
- Reduced invoice processing errors as personnel only focus on hard to interpret invoices
Why is RPA in invoice automation important?
Since the whole invoice management process is already digital, we have seen companies deprioritize invoice processing automation. This would be an error because even though the whole process is almost entirely digital even without automation, it trusts on a lot of manual labor. In the pre-automation process, invoices, the extracted data and payments are digital but the process is no less overwhelming than a completely equivalent process.
This issue of manual labor in digital processes is a widespread issue as companies focused on digitizing processes but not automating them. But this is being fixed as companies focus on automating repetitive processes. They achieve this mostly with Robotic Process Automation. If you are curious about RPA feel free to contact us on www.istnetworks.com