How to Automate Invoice Processing? An overview.

Did you know that some of your basic financial processes might be costing your business more than necessary? Every task has a cost, but managing those costs is crucial. One of these costs is the expense of processing every invoice your team handles. When you review the key metrics, you might be surprised to find slow processes, frequent mistakes, missed discounts, or even overdue vendor payments. Without invoice automation, these costs can quickly spiral out of control.

Improving how you handle invoices not only reduces these costs but also benefits your business in other ways, such as capturing discounts and gaining better insight into daily cash flow. So, why is automation so important today, and how does it actually work?

In this overview, we'll look at the reasons behind the growing use of automation platforms and provide a clear picture of how invoice automation works.

The Increasing Importance of Automated Invoice Processing

Managing invoices might be straightforward for smaller operations, but as your business expands, the process becomes more challenging. Higher invoice volumes and complex requirements can create significant difficulties, especially for large or international companies. Some of the most common issues you may face include:

• Time-Consuming Data Entry: Manually extracting and inputting data takes a lot of time and increases the likelihood of errors that could cause problems later.
• Lost Invoices: Misplacing invoices or paperwork can delay processing and lead to late or missed payments.
• Strained Supplier Relationships: Consistently slow payments can damage your relationships with suppliers.
• High Processing Costs: The complexities of manual invoice handling often result in higher costs.
• Slow Approvals: Frequent manual steps in the process lead to delays in getting invoices approved.

Introducing automation can help tackle many of these issues head-on. Consider the benefits across the entire process.

An Overview of the Automation Process

Invoice automation using platforms from RST Solutions offers a way to transform your entire invoicing process. It enables straight-through processing (STP) for a large number of invoices, significantly enhancing efficiency and reducing manual work. Essentially, an invoice can enter your system and move automatically to final approval and payment.

Capture The first step is capturing invoices from various sources like emails, web portals, mailrooms, or faxes. Centralizing these incoming invoices can be tricky, but automation makes it easy by gathering, organizing, and sorting them for the next stage.

Extraction After capturing, key data points like supplier name, invoice number, line items, and amounts need to be extracted. Manual extraction is time-consuming and prone to errors, but automation streamlines this process. Even with different invoice formats, intelligent automation can accurately identify and extract the necessary data.

Validation Next, the extracted data must be validated for accuracy. Automation simplifies this by enabling two- and three-way matching, with exceptions routed to human workers for further review when needed. Once validated, the invoice data is ready for approval.

Approval Finally, invoices that meet predefined rules can be automatically approved and paid. Any exceptions trigger notifications for human review. High-value or high-risk invoices are routed to the appropriate stakeholder for final approval, after which the payment process is automated.

What Does Invoice Automation Do for a Business?

Even a quick look at the process shows the significant opportunities for improving your operations. Consider a platform like RST AP Essentials.

Right from the start, AP Essentials offers organizations advanced OCR technology, ensuring high accuracy in extracting invoices from any source. Seamlessly integrating with your existing financial systems, AP Essentials reduces manual tasks and speeds up your workflow.

There are also third-party solutions in the RST Marketplace that leverage this technology to address specific business needs. The right combination of these platforms can bring crucial benefits:

• Improved invoice accuracy and fewer errors, reducing common processing delays.
• Freeing up skilled staff for more valuable tasks rather than manual data entry.
• Lowering cost-per-invoice and boosting key KPIs in accounts payable.
• Providing better data and insights to refine your processes further.
• Ensuring compliance and strong internal governance by adhering to rules.

Start achieving these outcomes with RST platforms today.

Evaluate What’s Possible in Your Business

Effective invoice automation allows you to move beyond manual processes and embrace the future of work. By reducing daily errors and streamlining procedures, you can free up skilled employees to leverage their expertise for more strategic tasks, rather than spending time on manual data extraction and invoice processing.

Email us at [email protected] to get a demo.