4 Invoice Management Features that Cut Procurement Costs

Even if you have the most efficient procurement team in the world, you’re still probably wasting money on invoice management. According to the American Productivity & Quality Center (APQC), unless your systems are automated, you’re likely spending an average of $15 to process a single invoice.

Which doesn’t sound like all that much— until you start adding it up.

Let’s say your team processes 100 invoices per month manually. That’s roughly 3-4 invoices per day. No big deal, right? When you do the math, it is a big deal.

You’re wasting precious time and resources on an inefficient administrative function.

But here’s the good news: according to McKinsey & Company, 89% of tasks related to placing and receiving orders can be automated, and 93% of the payment processing function can be automated.

Let’s take a more detailed look at how manual invoice management is slowing your team down and costing you money.

1. Add Digital Document Management

The procurement process includes managing a plethora of documents from RFP’s to PO’s to invoices and receivers. Your team has to extract pertinent information and match it to related documentation, get approvals for payments, archive that paperwork for future reference, and perform many other tasks that add up to a huge amount of time spent managing paperwork.

Managing invoices manually often means your team has to thumb through stacks and stacks of paper just to find what they need.

Even if all human error is removed and everything is filed correctly, this is still very time consuming. What if you’re searching for one specific piece of information but you’re not sure which document it’s on?

There’s no search function when all your data is contained in physical paperwork.

Digitizing these files in a system built for Procurement teams reduces and sometimes eliminates this tedious work.

2. Ditch Email & Manual Document handling

Many teams think the answer is to track procurement data using email. But scrolling through hundreds of emails to find the right documents — even if they’ve got designated files set up in their email client — can mean your team racks up hours of wasted time and effort.

Just because the information is captured digitally doesn’t mean the system is efficient.

Plus, if everyone keeps their own set of siloed email documents, communication gaps are bound to occur when teams can’t efficiently collaborate and that can mean duplication of effort and even more time spent cleaning up messes and mistakes.

Finally, once your team has found all the right documents, they’ve still got to match invoices to purchase orders and receivers (a three-way match), which adds yet another layer of complexity to the process.

You can eliminate the headaches of digging through endless email chains and convoluted folder structures by implementing a Procurement software with strong document tracking features.

3. Required data Fields Solves Missing Data Problems

Nothing slows down invoice management quicker than missing information. If a colleague has forgotten to fill in critical data on a form or has forgotten to fill out the form altogether, everything comes to a halt while your team chases after the information they need to resolve the issue.

Since each phase of the procurement process is contingent upon each other, any gaps in data can add hours to the time your team spends managing invoices and documentation.

Procurement software removes this obstacle by requiring certain data fields be populated on documents before they can be submitted.

4. Shared Fields Across Linked Documents Standardizes Data Accuracy

With a manual system, your team must carefully scan documents to make sure the numbers align, that all fields are filled out properly, that signatures have been obtained and that the proper accounting codes are assigned. They’ll need to spend time calculating how much money has already been applied to a purchase order and how much is still remaining.

Simply verifying data accuracy across documents adds needless cycles to your procurement process.

Procurement software allows you to ensure data accuracy by requiring that shared data fields across linked documents match before they can be submitted.

Procurement Software as a Solution

Using a cloud-based software system like ProcurementPath that utilizes ServiceNow data could mean the difference between $15 per manually processed invoice to $5 per invoice.

All the information your team needs is in one place and even vendors can log in to a secure portal to generate invoices from within the system so they’re accurate and automatically match up to PO’s. Your team won’t have to spend time scanning documents for accuracy, combing through paperwork or emails, or chasing people for information. The productivity gains are endless.

Using a digital tool for your invoice management function can streamline the procurement process, boost efficiency and save significantly on costs. It could free up your procurement team to focus on strategic initiatives within the organization and free up your bandwidth to take those projects from the parking lot to front and center.

Watch: Automating procurement on ServiceNow Webinar

Do you need to automate your procurement process and step up your company’s efficiency? If so, we invite you to explore ProcurementPath, the cloud-based productivity tool that streamlines procurement.