How Pre-Trained Artificial Intelligence Can Improve Accounts Payable
Accounts payable teams are responsible for payments of goods or services purchased on credit. They verify and ensure the services have been delivered and correct payments happen on time. Strategically, these teams work to reduce costs, for example, by taking advantage of discounts that come with payments being made ahead of the due date. Automation helps them achieve that goal.
Accounts payable automation has existed for some time now, accelerating invoice processing and offering many added benefits:
- Time efficiency—less time is taken for an invoice to get paid
- Reduced errors—automated workflows improve the overall accuracy of the process
- Lower processing cost—decreased costs have a direct impact on the bottom line
And the list goes on.
The long-tail challenge
While AP automation, organizations continue to process a percentage of their invoices manually. Why?
Most invoice processing automation tools are based on optical character recognition (OCR). In the early 1970s, OCR seemed to provide a significant return on investment (ROI). Yet, today, technology is limited in what it can help you achieve. The tools are difficult to set up and require their own IT teams to maintain. As a result, most AP automation programs focus only on the “direct spend,” the top accounts with the highest potential ROI—invoices from approved, high-volume vendors that the teams regularly interact with.
What is often left to be processed manually are invoices from various sources such as vendors without a contract framework agreement or negotiated work order. Those invoices, or the “long-tail spend,” are perceived as not being of a high enough volume and potential ROI to warrant devoting the time and resources for automating the work. After all, imagine what it would take to program an OCR automation solution to handle invoices from one-off vendors, each employing a different invoice format.
But processing invoices manually has its challenges as well. Organizations often believe they can handle the long-tail spend. Yet, while each vendor may send only a few invoices, with a large organization, the number of those vendors may be high, representing hundreds of thousands of dollars in a year along with endless formats to deal with. For some companies, there simply isn’t the time and resources to analyze this spend and manage it.
What’s more, the invoices could slip between the cracks, so to speak, as the result of manual workflows that span complex supply chains with disparate, fragmented IT systems and multiple stakeholders. Gaining visibility and control on long-tail spend can help save money and increase working capital. So how is that accomplished while improving automation for the direct spend as well?
Intelligent automation for AP automation
Intelligent Automation (IA) is a combination of Robotic Process Automation (RPA) and artificial intelligence (AI) technologies that empower rapid end-to-end AP automation. RPA tackles all the rule-based tasks such as downloading invoices and routing them to the appropriate people for approval, and AI provides the intelligence that is needed to pull data from multi-format invoices—without human intervention.
The power of pre-trained AI
The IQ Bot with pre-trained AI models that make it possible to quickly and easily extract invoice data. You can automate all your vendor invoices with a solution that’s ready to go out of the box. And the models can be further trained for specific uses such as improving extraction accuracy and straight-through processing rates for a particular high-volume vendor.
Each time a new vendor is added to the mix, IQ Bot can automatically process invoices and send them to the appropriate AP person for validation or for entering them into an enterprise resource planning (ERP) system. IQ Bot with auto-extraction ensures 100% of all incoming invoices will be processed.
This powerful combination of user-trained and pre-trained AI can help you streamline your entire AP process. You can increase visibility into your long-tail spend and optimize it just as you do with your direct spend. And that can help your AP and business become more efficient and profitable.