BPO Bulletin

A Key Challenge in Accounts Payable Process Automation: Part 3

by Ken Neal
January 4, 2016

Obstacles in the way of eInvoice adoption remain, at least in the U.S. The slow pace of eInvoice adoption in the US where eInvoice capability is not government mandated suggests organizations should not wait. They should implement a solution that may not be as efficient as a true eInvoice system but one that may be perhaps 75% as effective.

The obstacles to eInvoice adoption that would complete the P2P cycle automation in the case I describe have not changed, namely, the enrollment of suppliers in an eInvoice process. Without some kind of invoice standardization across all organizations invoices will continue to arrive in a variety of media formats over many delivery channels that simply cannot be processed by most P2P workflows, vendor portals, ERP workflows or eInvoicing networks.

The problem we have today in the invoice exchange process between buyers and suppliers is similar to what has been seen at the dawn of the industrial age before the adoption of standards for hardware like fasteners used in making machinery. This was a time when each manufacturer made its own line of fasteners such as screws and nuts in whatever size it chose. That meant fasteners from manufacturer A were not interchangeable with fasteners from manufacturer B. That presented a huge problem for the buyers who used these fasteners in production of any type of machinery because they would be required to use only one supplier’s product. If they used many suppliers they would have the burden of maintaining separate fasteners from suppliers A and B. Only after the standards were introduced where everyone made the fasteners to the same exact specification did the industry realize progress.

In my next post, I’ll focus on the fact that there’s some good news surrounding innovative technology that is advancing invoice processing. In the meantime, feel free to visit the Accounts Payable Services page of our website for additional information on industry trends, case histories and more.

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