Automated Invoicing – Improving Accounts Receivable Efficiency
Automated invoicing, or invoicing automation, is gaining popularity as businesses look for ways to free up accounts receivable staff to meet the challenges of a post-coronavirus world.
Automation reaches every part of a modern business. It is an inherent benefit of the increasingly digital processes seen throughout businesses today.
Any rules-based, repetitive electronic process is well positioned for automation. As invoicing is increasingly replaced by e-invoicing, this opens up the opportunity for automated invoicing. Even in cases where invoices are still printed and sent by post, invoice automation is possible − through electronic delivery of invoicing data to a local print hub, where your invoices are then printed and posted. For invoices that need to be delivered by post internationally, printing and posting from a hub in the same country as the recipient presents considerable time and cost savings.
With Forrester predicting that businesses can cut operating costs by up to 90 percent through automation, there’s a compelling case to find out more.
Will Invoice Automation Replace My Accounts Receivable Staff?
Simply put, no. Automated invoicing will allow your staff to operate more efficiently, focusing on where they deliver the most value. Invoicing, without automation, traditionally requires hours of repetitive invoice production each day. While automation will save that squandered time, there are additional factors to consider. Exceptions occur, buyers will delay beyond terms and sometimes a human touch can go a long way to resolving problems and bringing the cash in.
Automation delivers benefits for the majority of your invoicing requirements. When you free up your credit control staff, they can bring value to the normal invoicing flow through their handling of exceptions.
Like most business processes, it could be said that 80 percent of the value comes from just 20 percent of the work. Looking at figures from Atradius, we can see that 29.9 percent of invoices, on average, are paid late in Western Europe. The time that is freed up by automation can then be focused to improve cash flow.
How Can I Save Time Through Automated Invoicing?
The automation of invoicing presents a wide range of ways for accounts receivable to save time. Here are the key areas:
- Automated invoice creation – to a set of rules which determine what content is included (from ERP or other systems), what template is used, and other content-related factors.
- Automated invoice delivery – via email, EDI, FTP, or even traditional print and post.
- Automated follow-up – through delivery of statements and dunnings letters to encourage timely payment.
- Automated report generation – and at-a-glance status to track payments and manually follow up where required.
These aspects of invoicing automation replace repetitive manual processes with accuracy and efficiency. Not only do these automated processes save time, but they provide clear insight into status, which can be monitored and acted upon to ensure payment delays are minimised.
How Do I Automate Invoicing?
Automating your invoicing practices may seem daunting at first glance. However, working with an outsourced service provider can streamline the process and deliver automation far more quickly than in-house processing.
The first step is to identify your full range of templates and delivery requirements, then map them back to the corresponding data sources. Most of the information is likely to come directly from your ERP system(s) but may require merging with other systems. ERP systems can often produce some invoicing output but lack the depth of rules-based automation possible with a full-fledged electronic invoicing solution.
Outsourcing this process to a managed service provider means you are still in control of setting the goals, requirements, and performance indicators, while your outsource provider is responsible for complying with them and proving as much.
By delegating the responsibility of your invoicing management, you’re allowing someone else to take care of the details. Outsourcing allows you to tap into the knowledge, experience, and capabilities that can best deliver successful invoicing for fluid cash flow.
Find out more about automating invoicing in our AR Automation white paper.