Optical Character Recognition, or OCR as it’s commonly called, is a valuable software tool. But if you’re thinking it’s the answer to your paper invoice challenges, you’ll want to check out a new whitepaper by Purchasing Insight.
The report, There’s no “e” in OCR, examines some of the widespread misperceptions and fallacies that can lead organizations down the wrong path as they address the so-called “persistent paper problem” that plagues Accounts Payable. For example, you may believe the alternative, electronic invoicing, is too expensive, making OCR a more attractive option. Your OCR business case, however, needs to take into account all of the potential cost factors – some of which you might not discover until well after you’ve adopted the technology.
For one thing, a scanning and OCR setup doesn’t run by itself. As the paper puts it, “OCR isn’t simply a scanner and a little bit of magic.” There’s ongoing maintenance, plus the time-intensive process of “training” the system to deal with evolving formats as new suppliers come on board. Additionally, workflow and integration with your finance system can be complex, resulting in high professional services fees.
And, while OCR technology has come a long way, it’s not perfect. Because not every scanned document is interpreted 100% accurately, you will need to devote staff time to making sure everything’s good to go. Will scanning errors lead to time-consuming resolution processes? Will OCR translate to improved efficiency?
There’s no question that paper-based invoices and manual processing are major obstacles to cutting processing costs and enhancing AP performance. But OCR doesn’t eliminate paper-based invoices and it really only makes the process slightly less manual. Most important, it may not deliver the business value you expect.
eInvoicing: Beyond efficiency
Electronic invoicing, or eInvoicing, by contrast, offers measurable benefits, including reduced printing and mailing costs, fewer errors and disputes, less staff time handling inquiry calls, and improved ability to forecast cash flow.
Even more significant, as the whitepaper notes, is the potential for transforming AP from a back-office function into a strategically important unit. eInvoicing opens the door for AP to deliver profit back to the business through early payment discounting. In fact, eInvoicing in itself shouldn’t be the ultimate goal. It’s really a means of extracting true value for your enterprise, while simultaneously eliminating the “persistent paper problem.” I think you’ll agree that makes for a powerful business case.
Download the white paper to find out why OCR is not the cure for manual payables processes.
Still not convinced?
In this case study series, Going from 0 to 100, hear real-life case studies on how organizations got past the fear of automation and went from zero automation to streamlined workflow and eInvoicing processes, while adding millions to their bottom line with dynamic discounting.
Learn how various organizations adopted automation and accomplished everything from achieving 87% supplier enrollment rate, to reducing inquiries to 1 in every 400 suppliers, to saving $163m in 4 years.
Learn more about Taulia’s fully integrated eInvoicing solution.