10 questions every CFO should ask about invoice automation
As we look toward the third quarter of 2021, economic recovery is well underway. The issues that are up for debate include how much and how fast the economy will bounce back. In the past two years, many companies turned to technology to enable efficient work at home and provide the business agility demanded by quick and unexpected shifts in the economic climate According to a CFO magazine article, 10 Vital Roles for CFOs, “Digital fluency is more important as finance departments increasingly use technology to streamline and automate processes.”
Today, the CFO and their team are expected to provide deeper insight and more strategic direction than ever before with budgets and resources that remain constrained. Implementing a document management solution should be an integral part of their strategy. It increases efficiency in areas such as accounts payable, accounts receivable and financial audits. Document management systems also integrate with accounting software and ERPs.
Many companies still primarily receive invoices via unstructured formats like paper and email and automating these manual processes – even if they are just exceptions – saves time and reduces costs. Document management enables your team to capture, sort and archive invoices from any device or any format (scanned paper, email, mobile capture, business apps and more).
Jack McCullough, founder and president of the Forbes CFO Leadership Council agrees that adopting new technology is a vital asset for future-minded companies, “Few, if any, investments can give an organisation a sustainable competitive advantage like an investment in technology. Where else can an organisation invest that will increase top-line growth, operational efficiency, and employee collaboration?” he notes in CFO Priorities For 2021…And Beyond.
If you’re ready to take the leap, don’t invest in a document management system until you have the answer to these questions
1. Can you easily find invoices –not just search for them, but actually find them?
Huge productivity benefits can be gained by providing all offices with access to a centralised document pool and by directly incorporating field-generated documents into office workflows. Think about the difference it could make if each person had the information they need to do their job — without waiting in a queue at a physical file room or searching shared and personal drives for documents.
2. Can you extract key details from the invoices, including split code billing, and automatically match them to corresponding purchase orders?
This means monitoring the accounts payable email, extracting relevant index terms, such as vendor name, date, and amount, indexing the invoice, and applying artificial intelligence to all of the above so that the system learns over time.
3. Can your staff review and approve invoices on any mobile device? Anywhere?
Self-service access to information positively impacts everyone in the company.
Identify and implement best practices
4. Do you have a secure, organised and searchable invoice archive and audit trail for audits and budget planning?
One of the most stressful times for any accounting department is the wasted effort associated with responding to auditor document requests — pulling paper documents, copying them, and refiling the originals.
5. Do you process invoices promptly, take advantage of early payment discounts, keep track of due dates and status changes, and have control over your cash flow management?
Automation of the invoicing and payable process does not just save money; it earns money by allowing the company to take advantage of discounts. Organisations with manual invoicing processes usually lack the core information they need to effectively run the business — how many orders are waiting to be processed, where they are in the process, and the value of each order.
6. Have you standardised the core workflows that are needed to accelerate the approval processes
Organisations typically do not realise how much wasted time and effort — and money — is tied up in simply waiting for a manual process to move from one manual stage to another.
7. Is the supplier on-boarding process still a manual nightmare?
This is a source of a great deal of inefficiency, especially for larger organisations and those with a large number of field offices.
8. Can you route invoice approval requests based on amounts, vendor name or split code billing with multi-levels?
Automatic electronic workflows give an organisation the flexibility to keep work moving forward even when someone is away from the office.
9. Can you automatically post approved invoices to your accounting or ERP system, eliminating double data entry and errors?
Data should only be entered once either manually or via automated indexing then it is shared between systems. This integration with other applications enables streamlined workflows across business functions.
10. Have you standardised the core workflows that are needed to accelerate the approval process?
Organisations typically do not realise how much wasted time and effort — and money – is tied up in simply waiting for a manual process to move from one manual stage to another.
Once you begin the process of invoice automation and seek a solution, remember these additional questions as you talk to vendors.
- How does their product handle cybersecurity as work-from-home and hybrid work continues to be important?
- Can their solution be deployed via the cloud or on-premises – without sacrificing functionality
- How quickly can their solution be deployed?
- Can the solution provider give you a reference list of customers from your industry?
- Can you buy the solution “by the drink” – via a subscription model – or is a big upfront investment required?
- Can the solution be easily extended to other processes outside of finance, or is it just a point solution?
While financial process automation initiatives may start with the intent of reducing costs, the longer-term organisational impact provides an opportunity to redefine the role of the CFO. Looking forward, the CFO will continue to be the primary financial steward of the organisation. But the CFO also has a larger role to play, leading the charge for broader process transformation, and ultimately the transformation of the business itself.
Ready to eliminate manual touch from your invoice process?
If you want to know more about how to begin your invoice processing automation initiative, Key Digital can help. With our Document Management for Invoice Processing, a cloud-based solution, you can completely automate your invoice process, from data capture to approval, in just a few days; that’s how easy it is to get started.