Summary:
Learn how invoice processing software is rapidly becoming a disruptive innovation that allows companies to automate the tiring process of paying bills.
As we stated in Part One of this series, sometimes when a new technological invention comes along we wonder how we ever lived without the new device or technological innovation. A “disruptive innovation” is a particular category of innovation which creates its own demand. For example, the invention of the automobile created a demand for its purchase when it didn’t exist and the available substitutes were of a qualitatively different nature. In the technology field, the pace of innovation is increasing to the extent that it is commonplace to hear our customers make statements like, “I don’t know how I have lived without this.” Within the past two years, we have been hearing this about a particular type of software application: invoice processing software.
Invoice processing software is an application that automatically accomplishes several functions that have previously been done manually by accounts payable (AP) personnel. Before the innovation of the software, analysts had to open invoices that were mailed or emailed to them and then key in the important data from each document. For example, they had to locate the vendor, vendor business unit, total amount due, and due date in order to key this into their accounting system to create a bill to be paid in that system. For invoices that were not associated with a purchase order, such as a utility bill, they had to look up and then assign a general ledger account number according to the vendor listed on the invoice, and then manually create the bill in their accounting system. Finally, in some cases the company needed to reconcile each line item of a purchase order with their accounting system. This required the AP analyst to manually enter thousands of line items a month from the invoices or to cross check each one against the purchase order in the accounting system. With the arrival of invoice processing software much of this process can be done automatically, including the painstaking two and three way matching process.
Invoice processing software provides companies who use it with a huge competitive advantage since their invoice processing costs are typically reduced by 50% or more. This provides considerable cost savings to the company who can then take advantage of repurposing their AP personnel into areas which create value. Imagine if accounting students knew during their job interviews that they would be spending half of their week keying in line items from an invoice! A second huge advantage for companies that move to invoice processing software is that before it was impossible to have a grasp on their total value of payables, inventory, or receivables since many of the documents that contain this information were sitting in stacks of paper waiting for manual processing. Finally, invoice processing software is also good at catching mistakes such as double or over billing that might otherwise not be caught during manual processing.
Just this week, we began the implementation process of invoice processing software for a company in the Midwest. During the planning meeting, the IT analyst made a comment to the effect that invoice processing software is a commodity and you just have to select the very best product, and it seems that the ABBYY engine is used by many of them. This is why we have partnered with ABBYY USA to provide their FlexiCapture for Invoices product since its inception. We feel that this product offers such superior technology that when it’s incorporated at any company they will find themselves saying, “I don’t know how I have lived without this.”
Find out more about FlexiCapture for Invoices by visiting our web page: https://www.ufcinc.com/FCI