In the realm of finance, there is no denying that numerous processes are bogged down by tedious, repetitive tasks like data entry and report generation. However, it’s abundantly clear that these tasks are a perfect match for automation. By automating these tasks, finance professionals can focus on more strategic activities, such as data analysis and decision making.
It’s not new or surprising to say that automation is particularly beneficial for accounts payable. Automated systems scan incoming invoices, validate them against purchase orders and receipts, and route them through workflows for approval. These workflows reduce the time and effort required for manual invoice processing.
But the reality is, workflows are not true automation
At their core, workflows are a series of steps that move data or documents through a predefined path. While workflows can help streamline processes and increase efficiency, they still require human intervention at various points along the way, such as manually approving invoices or entering data into a form. Essentially, workflows are manual automation.
True automation, on the other hand, eliminates the need for human intervention altogether. Automated systems operate 24/7 and handle a wide variety of tasks without error. A truly automated system performs data entry, generates reports, and sends notifications without any input from a human operator. This level of automation leads to significant time and cost savings, and reduces the potential for human error.
True automation can be expensive and challenging
“True automation” requires a significant investment in time, technology, and people to design, develop, and implement automated systems. Additionally, many AP processes — particularly those in industries such as shipping, logistics, manufacturing, and media — are complex and require a high degree of customization to achieve full automation.
In some cases, it may not be possible to fully automate a process due to unique invoicing exceptions or regulatory or compliance requirements. As a result, many businesses have opted for a hybrid approach, combining workflows with automated systems. In this model, workflows are used to streamline processes, while automated systems handle repetitive or routine tasks.
The impact of AI and ML
For “true automation”, finance teams need to utilize systems with artificial intelligence (AI) and machine learning (ML) as native components of their operations and processes. With AI and ML, processes are not just streamlined; the system is continually learning and adapting for increased optimization.
The benefits of this approach are significant. Workflows and human interaction are continually minimized, efficiency is increased, errors are practically eliminated, and a high degree of accuracy and compliance is maintained. And the financial gains are even more impressive. Specifically, millions of dollars are gained by increasing control over vendor payments and credit, and by reducing fraudulent and duplicate invoices and overbillings. With the right platform, an AI- or ML-based solution can pay for itself in a few months.
The best of all worlds
While workflows serve as valuable tools for automating business processes, they are no substitute for the game-changing power of AI- or ML-based automation. True automation demands dedication and investment, but the rewards are immense. By embracing AI and ML and partnering with an experienced vendor that has made these investments on their behalf, finance teams can navigate the path to unparalleled efficiency and quickly regain control of cash flow.
Learn how AI and AP should come together in the Gartner Hype Cycle for Procurement and Sourcing Solutions 2023.