Why Is Automation Important ?
Automation is firmly on the agenda. It’s starting to move into almost every aspect of our home & working lives. Articles frequently appear in the press discussing the latest advances, or drawbacks, that are being experienced with driverless cars, robots and the increasing application of Artificial Intelligence and Augmented Reality to everyday activities.
In the business world, automation is high on the agenda as operational effectiveness returns as an increasing priority for CIOs as highlighted in the 2017 Harvey Nash KPMG survey. This is despite the high-profile focus on new data-driven digital projects and board level concerns about the risks posed by hacking, data loss & ineffective security systems.
Automation is nothing new in IT-driven business processes, without it many operations would be impossible to deliver as they are either too complex or too intensive and repetitive to be carried out manually. However, there are many areas where manual processing continues to be the approach leaving those organisations at risk of lower competitiveness as they face higher costs and lower levels of governance and insight. When asked, there are many reasons why automation is not used by these organisations including “We have too small a volume for automation to be needed” and “the cost of implementation is too high” or simply concerns about the impact automation may have on their existing staff.
This last point is maybe the easiest to address. That automation is inevitable and that some jobs could be largely automated in the future is generally accepted. The NY Times in early 2017 reports on a McKinsey study that concludes: Many tasks can be handed over to machines, but full replacement of human workers will happen more slowly than many fear. For many employees, automation is an opportunity to say goodbye to time spent on low value, repetitive activities and instead focus their effort on better business relationships, greater inter-departmental collaboration and using improved visibility to deliver new business insights. Similarly, James Bourne writing in Enterprise CIO concluded that recent surveys showed UK employees are largely optimistic about the impact of automation on working practices.
Where is automation having an impact on business?
While there are many areas of business that are appropriate to automation, I am going to look specifically at one of these – Accounts Payable Automation often abbreviated to AP Automation. Despite advances in the use of electronic invoicing by suppliers it is still in its relative infancy and for all but the largest organisations, studies estimate that between 80 & 90 % of invoices received are still on paper or simply copies received via email.
When processed manually each invoice has to be scanned – if on paper – and then data entered into an ERP system for processing. Invoices then go through several processing steps to validate and correct the data on them, typically by matching with a related Purchase Order and potentially a Goods Receipt. Approvals are needed which means transferring paper or scans to individuals who may be unavailable or paperwork is lost or simply ignored. During this lengthy period of processing a number of issues occur
- Suppliers and employees raise queries as to when payment will be made. Inaccurate or missing information causes frustration and damages relationships. Time is spent trying to answer the queries instead of processing the invoices
- Around a quarter of suppliers offer discounts for early payment which are often lost for those processing invoices manually
- Heads of Finance are unable to get an accurate picture of the total value of invoices outstanding and the impending impact of payments on cashflow
- Heads of Procurement don’t get insight into issues occurring with suppliers that may affect relationships and future business
So how does AP Automation help ?
AP Automation centralises the management of your invoice processing and removes manual intervention that can lead to errors. Integrated with ERP systems in real time the application ensures that business users have a consistent view. At the start of the process is the receipt of an invoice , when on paper, scanning and OCR are used to convert the document into an electronic form and extract key information. Supplier invoices all vary in format and content, an automated solution should learn to recognise the format without needing pre-definition and to improve the accuracy as more invoices are received.
Once captured, the invoice is processed including verification where the data is incomplete or inaccurate followed by matching to purchase orders if used and/or available. The organisation’s defined approval process is followed and recorded. Since many workers are no longer in offices the notifications can be received and approval/rejection or request for further information processed on mobile devices.
The solution should give the AP Team insight through dashboards and reporting into all invoices currently being processed. Delays affecting an invoice are easily identified and actions can be taken to resolve them.
Redfaire’s AP Automation Solution for JD Edwards
Redfaire is a longstanding Oracle partner and have implemented many JD Edwards systems for customers providing a full technical and functional consulting team. Detailed knowledge of the JDE application and the business processes used by Accounts Payable have allowed Redfaire to build an AP Automation solution that is closely integrated with JD Edwards. By design our AP Automation solution is implemented outside of JD Edwards, its independence minimises impact on future JDE upgrades and custom development. At the same time, the real-time integration ensures that both Accounts Payable teams and other JDE users see a consistent, up to date status. We work closely with JD Edwards Development and we are proud that Redfaire AP Automation has been awarded Oracle Validated Integration status.
Redfaire AP Automation is built on Oracle’s proven Technology for a scalable on-premise or Cloud deployment which can be implemented by companies with any volume of invoices to process. Invoice documents are stored centrally for easy access from any device. A powerful Business Process Management engine tracks the status of each invoice through processes which can be standardised for rapid implementation as well as easily customised as needed by each organisation.
Visibility into the AP Process is dramatically improved, dashboards highlight the current status and reports list the inflight transactions.
There isn’t space here to go into all the capabilities of our AP Automation Solution for JD Edwards, if you’d like more information please feel free to contact firstname.lastname@example.org
< Back to Blog