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AP

Top 3 Accounts Payable Technology Trends in 2021

April 19, 2021

The demand to automate workflows across accounts payables (AP) has witnessed significant growth — across small to large Enterprises. Scope and intent for automation are different across most companies depending on the underlining business requirement and process cycles.

When we imagine automation as one of the primary growth drivers towards increased profitability - we might envision the AP function, to be automated with little or no touch and operating in a paperless environment - where invoices are automatically processed, routed for approvals, and paid.

1. Intelligent Data capture

Organizations will migrate towards using intelligent data capture solutions to extract data from invoices and other documents.

The first wave of document capture solution was driven by template-based optical character recognition (OCR) technology. However, this approach had (has) many pitfalls. Staff members needed to create templates to extract data from invoices or other documents manually based on the incoming document layout. Every time a new vendor is added, the staff members must create a newer template to accommodate the new format This process of creating templates and managing them on an ongoing basis can be a headache for the IT department supporting the Finance and Accounting teams and can take easily from days to weeks.

Combining OCR with embedded AI capabilities opened a new world of opportunities in data capture technology and paved the way for intelligent capture. It helps businesses process invoices with different formats seamlessly, without worrying about the format and even the language of the invoices. It is helping companies with enhanced productivity, reduced cycle time and improve customer experiences.

2. Better Together: AI + Business Rules

Business operations are diverse across most companies, based on which roles and responsibilities are defined within an accounts payables (AP) function. An organization with a global presence may witness different fulfillment requirements across AP centers to ensure processes are running efficiently at maximum capacity, and with zero downtime.

It can be a daunting task for AP team members to actively check and monitor the inflow of documents to detect errors and ensure seamless process continuity in a rapidly changing environment.

AP team members are required to validate the extracted data with their existing systems of records, based on which approvals and payments are undertaken. The invoice reconciliation activities encompass matching invoices with the purchase order (PO), matching line-item information, troubleshooting situations where the PO is missing, calculating tax, and many more. As the company scales its operations, the volume of incoming documents will only increase and add to the AP team's woes. Manually reconciling also leads to unwanted errors.

The combination of AI, along with business rules, has revolutionized the invoice reconciliation process. As the data is extracted from the invoice, the system automatically checks and notifies the operator regarding mismatches. The system also guides the operators to resolve the mismatch. Previously AP teams needed to navigate multiple systems and screens to reconcile invoices, all of which were time-consuming and inefficient.

An Intelligent Document Processing software like Kanverse combines AI and out-of-the-box business rules to help organizations validate and verify the data the moment it is extracted. Catering to changing business needs, administrators can also create custom logic to validate the extracted data. It saves time, reduces the chances of errors, and boosts productivity in multiple folds.

3. Not just RPA, AI powered Automation

Not just intelligent capture but taking the extracted data seamlessly into an ERP system after proper validation is extremely important to have the touchless experience. Inbuilt workflow engine helps automate workflows in accounts payable right from invoice receipt to payment, and delivers quantifiable value in several areas:

  • Enhanced Resource Utilization: Eliminating the repetitive, time-consuming, and manual activities allows the accounts payable team to focus more on business-critical and strategic initiatives. It helps reduce costs and contributes positively to the bottom-line.
  • Reduced Invoice Processing Errors: Manually reconciling and processing data can lead to unwanted errors. Automating data validation activities across invoices, purchase orders, and existing systems of records can mitigate risks and bolster operational efficiency.
  • Reduced Cycle Time:Automating payments and approval workflows for invoices reduces manual touchpoints, increases the speed of delivery, and helps scale business.

About the author

Akhil Sahai, Chief Product Officer, Founding Member

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