COVID-19 Fraud Prevention: The Benefits of Invoice Approval Software
Since the dawn of the twenty-first century, digital transformation has made significant inroads across all business sectors. However, for businesses of all sizes and types, many essential business processes remain unoptimized and therefore a drain on, rather than contributors to, value. High-volume processes that can be readily automated, such as invoice approval and processing, are particularly rich in potential for improvement—especially during times of crisis.
As the world adjusts its expectations and workflows to accommodate the “new normal” of life with COVID-19, accounts payable (AP) departments are discovering just how effectively such automation can help them save time and money while eliminating waste. And in fact, it sets the stage for both complete AP automation, comprehensive procurement/AP automation, and value creation for their organizations as a whole—during good times and bad.
How Invoice Approval Software Can Help Your Business
Invoice processing in general, and invoice approval workflows in particular, are traditionally tedious and time-consuming. In addition to tying up staff time and talent in low-value, repetitive tasks, paper-based, manual invoice approval processes generate significant waste and expense. Paper invoices must be received, processed, organized, and stored in physical locations, and are susceptible to destruction from fire, floods, and other physical hazards.
Add in the extra expense and frustration associated with correcting human errors, chasing exceptions, and investigating/combatting invoice fraud, and one begins to wonder if there isn’t a better way.
Thanks to modern technologies such as artificial intelligence, process automation, and cloud-based computing, there is a better way: invoice processing software. In fact, automation can reduce average invoice processing costs to a fifth of their manually processed counterparts, slashing errors by 40% at the same time.
And yet, despite the spreading ripples created by digital transformation in the modern marketplace, a surprising number of AP teams continue to use manual, paper-based versions of invoice approval workflows and other AP processes.
Persisting with manual or last-gen solutions for your AP workflows can be particularly dangerous during a crisis like the coronavirus pandemic, when opportunistic fraudsters seek to profit from the unwary via invoice and supplier fraud.
Those who choose to automate with, however, can expect a bevy of powerful benefits, including:
- Faster invoice approval, including support for invoices with no associated PO (non-PO invoices). Intelligent analysis and automation allows for a variety of process improvements, including contextual approval for matched invoices that fall below established pre-approved spend limits. Invoices are automatically routed to their assigned approver, and contingencies can be implemented to generate automatic alerts when bottlenecks occur, or even re-route the invoice automatically to the next approver in the chain.
Non-PO supplier invoices that enter the system can be flagged and routed for review and advanced approval automatically. This not only ensures transactional visibility and reduces invoice fraud, but over time, can help reduce the total number of non-PO invoices (and rogue spend, invoice fraud, late or duplicate payments, etc.) by encouraging staff to company catalogs for ordering goods and services. This sets a new “gold standard” that will continue to bear fruit regardless of current global crisis conditions.
- Faster, more accurate, and paperless invoice workflows across the board, with complete support for invoice capture using electronic invoicing (eInvoicing) or digital capture of paper invoices received via mail or fax using advanced optical character recognition (OCR) to create a complete and editable digital version.
- Lower error rates, lower costs per invoice processed, and immediate availability of invoice data on the shared, cloud-based server for review, approval, and analysis.
- Easy connection of invoice management to other applications in your software environment, such as your enterprise resource planning (ERP), customer resource management (CRM), accounting software, and office productivity packages.
- Total visibility into every step of the invoice process, in real time, along with on-demand, customizable reports from both desktop and mobile devices. Users can generate and review reports to examine:
- Financial and process audit trails.
- Payables overdue
- Cash discount forecasting
- Payment analysis
- Cash flow analysis
- Automatic three-way matching to purchase orders (POs) and receiving paperwork.
- Gains in efficiency and productivity as staff are freed from low-value tasks like data entry and exception chasing to perform more strategically valuable tasks. Overhead is reduced, fewer labor hours are needed, and while automation removes the need for most intervention, the ready availability of invoice data makes it easy to do so when needed. With staff freed from low-value tasks, they’ll also have the time and energy necessary to guard against fraudsters looking to exploit under-staffed and overworked companies struggling to survive in a pandemic.
- Capturing more early payment discounts and avoiding late payments.
“Thinking comprehensively about AP process automation is about more than just a software solution. It’s an overall transformation in business process management—one that centers procurement and AP (which touch every dollar that flows through your finances) as value generators that support the goals of your entire business.”
The Best Way to Automate Invoice Approval
Taken alone, the improvements AP departments gain from automating the invoice management process (including invoice approval) are enough to give a strong shot in the arm to AP’s role as a value creator. But if you’re planning to automate your invoice approval workflows, the ideal choice lies not in standalone invoice approval and automation software, but in building a comprehensive procurement and AP automation plan centered on the implementation of cloud-based procurement software like PLANERGY.
Why? Because a modular workflow automation and optimization solution makes it easy for businesses of all sizes to plan and implement digital transformation at their own pace. A small business, for example, might start with automating their invoice management, then expand to include all of AP and, eventually, the entire procure-to-pay (P2P) process. In time, they can apply the benefits of process automation and continuous improvement to business processes across business units and throughout their organization. This flexibility makes it much easier for organizations of all sizes to secure their invoice processing and other AP processes during a downturn, disaster, or pandemic while still leaving room to build in additional enhancements once conditions improve.
Thinking comprehensively about AP process automation is about more than just a software solution. It’s an overall transformation in business process management—one that centers procurement and AP (which touch every dollar that flows through your finances) as value generators that support the goals of your entire business.
Automating your invoice approvals and other invoice processes (for example) provides a natural foundation for automating your purchase order cycle to achieve similar gains in productivity and savings (lower cycle times, fewer errors, massive gains in efficiency thanks to robotic process automation handling thousands of documents in a fraction of the time it would take a human to do so, etc.). From there, you can expand process automation and streamline things like vendor onboarding (using a supplier relationship management module), strategic sourcing and planning (using advanced analytics to review historical and current supply chain data, both independently and as it relates to important key performance indicators such as average invoice processing time, vendor accuracy and compliance, etc.).
Alternatively, choosing to work with your provider to develop a full procurement and accounts payable automation plan that fits your company culture, budget, and timeline gives you the option to begin enjoying greater speed, accuracy, and performance in all processes from the jump. For companies positioned to make this leap, weathering COVID-19 and other disasters is much less arduous for staff and more effective in slashing risk and fraud for the organization.
Automating Invoice Approval Is Just the Beginning
Life is full of uncertainties, and finding ways to mitigate and guard against disaster is instinctive for both individuals and organizations. Faced with a crisis, both big and small businesses can take advantage of immediate improvements in efficiency and profitability when they choose to automate manual processes like invoice approval. The benefits will persist long after the quarantine ends.
And to take full advantage, streamlining all your business processes by embracing digital transformation, is one of the most intelligent defensive moves a company can make when resources are low and every dollar, work hour, and sale count more than ever. By choosing a procurement solution that allows you to achieve full procurement and AP automation, your business will be ready to redefine AP and procurement as value generators rather than simply cost savers, and expand process automation, artificial intelligence, and continuous improvement throughout your organization. You’ll be able to weather the current crisis, and ready to rise to new heights of productivity and success when the coast clears.
PLANERGY Gives You the Tools You Need to Automate Invoice Approval and So Much More.