Optimising Straight-Through Processing for maxmising AP Performance
When it comes to processing invoices ‘straight-through’, there is huge variance among organisations.
Of all the benefits that Accounts Payable departments want from an electronic invoice processing solution, straight-through processing is pretty high on the list.
When ARI Fleet (then Fleet Support Group) approached DCS, they weren’t necessarily defining their challenges in these terms, but their manual processes carried the risks of error, loss or tardiness so an automated invoice processing solution was the answer. The cherry on top would be the resultant ‘straight-through’ processing…
What is ‘straight-through’ invoice processing?
Simply, it’s when an invoice enters a scan-capture-process system and is automatically recognised as valid, data-extracted and presented for authorisation with no fuss. Human AP operators are not bothered with it from the moment they feed it into the system until the moment they are asked to authorise the payment.
The important thing to remember is that straight-through processing is a measurable metric, not the solution itself. A project to implement automated invoice processing should ideally have maximising straight-through processing as a key deliverable.
ARI Fleet integrated the scan-capture-process solution with their ERP system so that gradually more and more ingested invoices would make it right through to the payment system and awaiting authorisation without human intervention.
How can invoice processing be optimised?
Invoice processing can be optimised by implementing a solution that recognises templates, and is taught to become familiar with frequent/trusted suppliers.
Order numbers, supplier names and codes on invoices are matched in these templates. This reduces the number of exceptions that occur (which compel human operators to step in and view invoice data before the authorisation stage).
Along with such a solution comes fantastic process visibility, efficiency and control:
We have been able to significantly improve our internal processes and now have tighter control on the overall invoicing process. With the same resources the Accounts Department is efficiently able to manage all elements of invoicing, and dependency on other departments has reduced.”
- Sharon Avery, Accounts Manager, ARI Fleet
What are the measurable benefits of straight-through invoice processing?
ARI Fleet saw an immediate time saving of 9 hours per day by being able to redirect staff hours away from processing and authorising invoices. The faster, more efficient system reduced the ‘chasing-up’ of invoices by almost 50% thus further easing pressure on the AP team. This led to fewer invoice disputes and improved supplier relationships.
Straight-through processing is a much sought-after goal that clients learn to trust. As Dan Durrans (IT Department Co-ordinator at ARI Fleet) put it: “Although we started by manually checking every scanned document, we have now gained confidence and can see that manual validation is no longer required.”
Once installed with invoice processing in mind, the scan-capture-process solutions that DCS implement can be extended to recognise and accommodate other kinds of documents in the same manner. If the likely volumes justify such a project, then naturally straight-through processing would become a key performance indicator for these alternate purposes as well.
If you would like to know more about the Invoice Automation project we implemented with ARI Fleet or if you would like to consult us on invoice process automation, please Contact us
- Accounts Payable