How AP Automation Solutions Work
AP automation solutions are integrated with your ERP system.
Data from dozens of ERP master files are mapped between the two systems, including the chart of accounts, sub- ledger, address book, supplier master, company master, business unit master, purchase order header and detail, PO receipts and user-defined codes. Data are also pushed back to the ERP system. Key Requirement: The best solutions provide native integration. This eliminates the movement of files back and forth and ensures the systems are always in sync. Moreover, it is maintained by the AP automation vendor, eliminating the need for ongoing support from IT.
Invoices are uploaded to the AP automation server.
They can be emailed, scanned, or uploaded from FTP sites. Key Requirement: Insist on a vendor that provides invoice training and a supplier portal. Invoice training allows customers to submit problematic invoices for OCR training. A portal enables suppliers to submit invoices directly to the system and bypass the scanning process altogether. This cuts down on cost, speeds processing, and enables companies to take better advantage of prompt payment discounts.
Technology captures data.
Sophisticated optical character recognition (OCR) technology captures data from the uploaded invoice and updates the information in the appropriate fields. This eliminates manual entry and related errors and speeds up the entire AP processing stream. Key Requirement: OCR quality and performance vary greatly. Select a solution that can process in excess of 90% of your invoices, at the rate of 30 seconds per invoice. Better yet, select a vendor that includes invoice training-as-a-service with the subscription.
Verification, Routing, and Updating
The AP automation solution confirms that all data have been entered correctly, routes it for approval, and updates the ERP. The ERP is continually refreshed with invoice status as it moves through the approval process. Key Requirement: The best solutions support mobile devices. Mobile devices allow remote users to approve, correct and upload invoices when working from home or traveling. This also empowers non-traditional users (retail outlets, remote locations) to actively contribute to the AP automation process.
Archive & Analysis
All data captured during the invoice entry process is archived and available for analysis. Archives can be searched dynamically for any value or text. Results can be viewed at the invoice header or line level or exported to tools like Microsoft Excel®. Key Requirement: Look for a solution with embedded analytics. The power of AP automation goes far beyond an improvement in processing time. Robust analytics can provide insight into staff performance, identify bottlenecks in processing, and help ferret out fraud and improper payments.
