Digital Invoice™ – An Important Step Towards Frictionless Procurement
July 16, 2018
Last week, I found the need to use a postage stamp to mail a thank you card. As I scoured my office, I realized just how long it had been since I’ve had the need to use one.
In fact, I couldn’t even remember the last time that I addressed an envelope. As a society, we have certainly gotten away from the once common uses of handwritten letters and personal bill payments, as now those activities are mostly digitized. For me, this is welcome progress in technology that increases efficiencies not only in my personal life, but also in the business world.
As we move into the digitized age of procurement with unprecedented growth in e-procurement Cloud-based platform adoption, we still see quite a bit of “paper-based” supplier transactions remaining. Although the top tier Source-to-Pay (S2P) platforms are enabling the transition away from paper within corporations, we are still seeing large amounts of suppliers lagging to adopt digital transformation. They continue to bog down AP departments with mountains of paper invoices, forcing everyone to continue to process and manually handle documents.
Over the past few years, we have seen a good number of organizations avoid this extra work and cost by outsourcing this invoice drudgery to an invoice imaging partner.
Outsourced services help organizations reduce the complexity, cost, time and errors associated with managing and distributing inbound documents. Through benchmarking data done by APQC and featured in CFO Magazine, the average cost to process an invoice in the traditional method is $5.83 per invoice. Moving to the outsourced model, we have seen corporations significantly reduce this cost. This offers not only immediate savings, but also helps to move the organization further towards true digital procurement without the need to manually “touch” each invoice.
Digital invoice processing offers the net effect of enabling a supplier to digitally provide line-level detail, offering all the advantages including accuracy, timeliness, business detail, etc. In addition, this allows you to transact in a digital fashion immediately with your suppliers, while allowing them to become digitally enabled over time.
Shelby’s Digital Invoice™ product is an end to end solution, leveraging the power of digitizing the information on invoices and the infrastructure of a client’s P2P platform. This allows all exception handling to take place within the platform, rather than having to work through an invoice imaging company’s separate portal. These technologies, coupled with Shelby’s procurement guidance, truly allows for “Frictionless Procurement.”
Adding Digital Invoice™ to your platform provides the following benefits:
- Operational Efficiency:
- Reduced overhead costs and operating expenses, allowing the focus to be centered around the revenue-producing aspects of businesses
- Advanced image capturing technology streamlines business processes and improves corporate agility and responsiveness
- Process visibility providing an audit trail for each document through real-time transparency into processes
- Financial Business Impact:
- The information obtained gives the power to make decisions faster
- Faster approval workflow cycle allows the Accounts Payable team to schedule payments to capture discounts and optimize cash flow
- Visibility and strategic knowledge allows companies to negotiate savings with suppliers
As discussed in the blog Beyond Amazon, it is truly an exciting time as we continue to journey towards entirely digitized procurement organizations. As we move along each of our individual journeys, it is important to properly utilize every tool that we have available to realize the value of modernizing procurement.
Senior Account Director