Automated invoice processing
Achieve above 70% straight through processing and reduced
duplicate payments through automate invoice processing
Process
The client is a leading retail company. Invoice processing is a key problem for the client due to the hundreds of formats of the invoices. The Accounts Payable team then extracts the data from these invoices for entering in the Enterprise Resource Planning (ERP) system. However, the variability of the formats makes this task tedious and repetitive. In addition, the frequency of changes to the invoices makes standard automation an expensive solution. The additional checks being performed by the Accounts Payable team also had manual entries in the “Goods Received” register. This also added complications to the process, which caused delays and errors. The client was looking at a solution that could take care of these issues.
Solution
The solution involved applying Optical Character Recognition (OCR) to convert invoice documents to text. This digitized data is then fed into our AI/ML model to extract relevant information from the invoices. Historical and real-time data is used to train the Artificial Intelligence (AI) model, and accuracy keeps improving over a period of time. Any exception in identification was flagged to humans and the corrected information is used to improve the AI model. Once the extracted data is verified it is then handed over to Robotic Process Automation (RPA) bot for entering into their ERP software and processing of the invoice.
Challenges Addressed
Variability of invoices
Invoices came in hundreds of formats making it difficult to use standard automation technologies.
Manually intensive process
The process was low on automation and required manual intervention in most stages hence growth in business was depended on hiring more resources.
Seasonality of invoices
Invoices received from vendors did not come in a steady inflow, there are huge peaks at the end of the month and quarter. This caused high staffing requirements to handle peaks.
Errors and duplicate payments
Incorrect processing of invoices caused duplicate payments to vendors which had high financial impact to the company.
High Turnaround Time (TAT)
High TAT results in challenges in receiving supplies from vendors and taking advantage of early payment discounts.
Outcome
- 99.5% accuracy in invoice processing.
- 78% straight through processing, avoiding multiple to-and-fros.