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Enterprise Automation Statistics

10 Enterprise Automation Statistics for the Cost-Conscious Executive

Enterprise Automation Statistics

Industry 4.0 is here, which means top executives are taking it upon themselves to equip their businesses with the tools and resources necessary to stay competitive and improve profitability. Although there are several ways to improve operational efficiency across the enterprise, there are only a handful of solutions that can generate appreciable ROI from the outset, and among these, Enterprise Automation reigns supreme. Are you still performing your due diligence on automation? These 10 Enterprise Automation statistics will help you obtain a better understanding of why the time to automate is now.

 

For business leaders, it can feel like the goalposts are constantly being moved when it comes to Enterprise Automation. Innovation is at an all-time high, which means new features, functions, integrations, and products are always on the horizon. A quick search online might yield dozens of potential vendors. Due diligence could take weeks, even months, to complete. It’s easy to get overwhelmed, but that doesn’t mean you should stall your Digital Transformation; instead, consider these ten Enterprise Automation statistics!

1. It Takes Employees an Average of 18 Minutes to Locate a Document Manually

Before you can automate, you must first digitize. Digitization of your business-critical documents ensures that they are never lost or destroyed. They can be recalled on demand without a trip to the file cabinet or warehouse, allowing you to establish a frictionless work environment where productivity is prioritized. It takes employees an average of 18 minutes to locate a document manually, which can account for up to 50 percent of their time. When you digitize your documents, you reclaim this time lost and set the stage for the real game-changer: Enterprise Automation.

2. 60% of Occupations Could Save 30% of Their Time With Automation

Once you’ve performed your due diligence and identified your ideal solution, it’s time to identify which business processes are best suited for automation. When automating workflows, you want to zero in on departments that process a large volume of paper and/or information. In our experience, some of the best departments to automate include:

There is no “wrong” answer when you start to automate business processes; however, there are certain departments that will yield a higher ROI than others due to a number of factors. Here’s the good news. According to a McKinsey Study, 60 percent of occupations could save 30 percent of their time with automation, which means the potential for automation within your organization is largely untapped.

3. Employees Spend 69 Workdays Each Year on Manual Administration-Related Tasks Instead of Their Primary Job Duties

Businesses that automate drastically reduce wasteful spending by eliminating repetitive, time-consuming tasks that lead to productivity issues. In a study conducted by DJS Research on behalf of Unit 4, it was revealed that people spend 69 workdays each year performing manual administration-related tasks instead of their primary job duties. Enterprise Automation helps you reclaim this time and put it to use however you see fit. Can you imagine how much more your employees could accomplish with an extra 552 hours per year?

4. Businesses That Adopted Big Data Reduced Overall Costs by 10% and Increased Overall Profits by 8%

Another benefit of Enterprise Automation is that it allows you to bolster your analytics efforts to get a clearer view of the nuances of what is (and isn’t) working process-wise within your organization. You can identify operational bottlenecks, inefficient processes, and even track individual performance to make sure each of your team members is putting forth equal input to help you achieve your fiscal goals. You don’t have to wait until the end of the quarter to collect data and generate reports like the old days. You simply click a button and your reports are ready to view or distribute. Improving business intelligence keeps everyone in your organization on the same page and working towards the same objectives, which explains Business Application Research Center (BARC) findings that businesses with big data capabilities are able to reduce overall costs by 10 percent and increase overall profits by 8 percent on average.

5. Bad Data Costs Businesses $600 Billion Annually

Collectively, businesses forfeit $600 billion annually as a result of poor quality data. On a case-by-case basis, this can account for as much as 20-35 percent of operating revenue costs. That’s not a figure to scoff at. The Business Literacy Institute considers a sustained growth rate of 10 percent a year to be “remarkably good,” so if you’re currently losing 20-35 percent of operating revenue costs to bad data, the numbers suggest that your business could be trending in the wrong direction.

6. Manual Business Processes Cost Businesses $5 Trillion Annually

$600 billion in lost operating revenue costs will certainly catch the attention of any executive, but it’s only a small fraction of the revenues lost to manual business processes. Manual business processes cost businesses $5 trillion annually. For reference, that is $2 trillion more than the U.S. deficit for 2020. Of all the Enterprise Automation statistics in this article, this might be the most alarming because it suggests a significant window of opportunity for any executive who is willing to take the leap and automate their company.

7. 75% of Businesses State That AI Will Allow Them to Transition Into New Businesses and Ventures

Businesses that are no longer at a functional disadvantage can do more with the resources available to them. Growth is a key indicator of a company’s overall success. 75 percent of businesses state that AI will allow them to transition into new businesses and ventures, allowing them to expand operations into new and increasingly profitable areas that would be barred off otherwise. For growth-minded executives fueled by ambition, an investment in Enterprise Automation equates to an investment in a growing portfolio of future-proof ventures.

8. 84% of Executives and Analysts Say AI Will Help Them Obtain or Sustain a Competitive Advantage

Executives and analysts alike are keen on automation because there is still a long way to go before this technology has been adopted universally. In other words, companies that automate sooner than later can get a head start in Industry 4.0. Just think, how would your business look today if you were the first to invest in a mobile-friendly website, automated customer service, or paperless process management? There’s a reasonable chance that with earlier adoption of these technologies, many of which were considered big risks at one point, your business would be further along with its Digital Transformation and more resilient to business interruptions. According to Forbes, 84 percent of executives and analysts say AI will help them obtain or sustain a competitive advantage — which means there is no time to waste.

9. 67% of Businesses Believe Implementing Digital or Software Solutions Is Important to Remain Competitive

AI plays an important role in automating business processes, but it’s not the only solution for companies looking to streamline and cut costs. 67 percent of businesses believe implementing digital or software solutions is important to remain competitive. Some examples of software solutions that can help enhance the enterprise include:

10. Automation Projects in Paper-Intensive Departments Generate an ROI of 30-200% in the First Year

According to ThinkAutomation, automation projects in paper-intensive departments, like Accounts Payable, Human Resources, and Customer Service, typically generate an ROI of 30-200 percent in the first year. In Accounts Payable, where Enterprise Automation can increase processing speeds by as much as 70 percent or more, many businesses recoup their initial investment in less than twelve months. Forward-thinking executives tend to leverage these savings to expand their solution across the enterprise to facilitate a more connected, data-savvy work environment.

These Enterprise Automation Statistics Speak for Themselves, Only You Can Speak for Your Business

Are you ready to cut costs, increase operational efficiency, and future-proof your business? These ten Enterprise Automation statistics speak for themselves, but it’s up to you to be the voice of reason at your company. If your team is still entering data to your ERP system manually, shuffling through file cabinets to locate documents, or paying the same invoice more than once, it’s time to make a change.

With IntelliChief, you can preserve your existing business processes and enhance them with industry-leading Enterprise Content Management (ECM) and Workflow Automation capabilities. To learn more, contact IntelliChief today.

Automation Skills Gap

How Businesses Can Address the Automation Skills Gap With a Team-First Approach

Automation Skills Gap

There is a significant skills gap with automation, one that must be confronted head-on to address deficiencies that could threaten your digital transformation. According to Forbes, “63 percent of business leaders believe the pressure to reduce costs will require their organizations to use AI in the next five years,” which means the clock is ticking on businesses that have yet to start to their automation journey. Don’t worry. This article is the perfect jumping-off point, answering essential questions like:

 

  • What is the automation skills gap?
  • Why is it important to open up a dialogue about automation?
  • Which tasks can be automated to benefit your team?
  • Why does automation give leaders the perfect chance to retrain and upskill their workers?

What Is the Automation Skills Gap?

Any competitor in an industry with a growing skills gap is in danger of losing their market share if they cannot find a way to address their deficiencies. In many cases, these skills gaps are the result of generational shifts in the types of occupations being pursued. For instance, the skills gap in the construction industry is the result of a lack of millennial construction workers. To attract new talent, contractors are investing in technology and software to help bridge the gap between the needs of the industry and the talents of the new generations. That said, generational shifts in the interest toward certain professions aren’t the only catalyst for skills gaps.

In regards to automation, the skills gap is related to technology. Digital Transformation is sweeping the globe, and those who fail to adapt will find themselves fighting an uphill battle against their competitors who have equipped themselves with the tools to work faster and more efficiently. McKinsey surveyed 1,500 executives across a broad range of industries and found that “addressing potential skills gaps related to automation/digitization” was a Top 10 priority for 66 percent of respondents. Furthermore, it was a Top 5 priority for 30 percent of respondents.

Industry 4.0 is here, and businesses are being forced to evolve. It is this evolution that has revealed an opportunity for the next generation to capitalize on the need for talented, automation-savvy workers that possess the soft and technical skills necessary to help businesses thrive in an automated world.

Remember, automation isn’t a substitute for your valued workers; it’s a complementary asset that improves work for everyone. It’s time to transform. For business leaders, that means not only consulting with automation experts to plot your Digital Transformation but also meeting with your team to retool your enterprise for a more profitable future.

Open Up a Dialogue About Automation

If you are already in the process of exploring your options to automate your company, it’s important to take note of three things before you commit to a purchase:

  1. Automation can be implemented to take over tasks, but it’s less effective at taking over jobs.
  2. Automation works best as a complement to your existing team.
  3. Automation can ameliorate working conditions to improve company culture and worker retention.

With these facts in mind, it’s time to open up a dialogue with your team so they are aware of your intentions to automate the company. Whether you’re looking to implement automation in Accounts Payable, Sales Orders, Human Resources, Customer Service, or another department entirely, you want to quell any concerns about automation and help your team understand why automation is important and how it will positively affect your company. You might be surprised to find that they not only take the news well but embrace it and support you. The automation buzz continues to build year-over-year, but not for the reason you might expect.

Adobe Digital Insights analyzed 3 million social mentions related to “future of work” and found that sentiment towards the role of automation in the workplace was overwhelmingly positive. People are more interested in learning about how automation can make their jobs more enjoyable as opposed to how automation could affect employment negatively.

Target the Menial, Time-Consuming Tasks Your Team Loathes

Now, it’s time to address the skills gap preventing you from taking the next step on your automation journey. The skills gap with automation refers to the soft and technical skills required to help employees thrive in a workplace that has incorporated automation in some form or another (i.e., AP Automation, Data Entry Automation, etc.). However, before you can address these skills gaps, you must identify them by mapping out business processes for automation. It is recommended that you undergo an in-person or virtual whiteboarding session with an experienced automation expert so you can target the menial, time-consuming tasks your team loathes — those that are the best fit for automation and tend to be error-prone, such as:

  • Data entry
  • PO/Non-PO invoice processing
  • GL coding
  • Auditing
  • Document routing

Once you have identified the processes suitable for automation, you will have a better understanding of the tasks that can only be completed by your valued team members. During this time, it’s highly recommended that you take a step back to focus on how you can retrain and upskill your workers to create a more resilient and self-sufficient workforce.

Focus on Retraining and Upskilling

Automation helps your business optimize processes that are commonly viewed as tedious and repetitive, but it’s not a panacea for all of your operational woes. As the emerging leader in workflow automation for the enterprise, we speak from firsthand experience when we say that your business will get significantly faster and more efficient, but there’s still work to be done if you want to gain a leg up on your competition. This is where your most important asset, your employees, get a chance to truly shine.

Did you know that 82 percent of executives at companies with annual revenues exceeding $100 million believe retraining and upskilling are the primary solutions to addressing the automation skills gap? It’s time to get to work! Job roles are changing and being redefined, yet 42 percent of US businesses lack a solid understanding of how automation will affect their future hiring processes in relation to specific job skills. Retraining and upskilling workers already under your employ are viewed as urgent matters by most business leaders. When you automate your company, you are presented with the perfect opportunity to assess areas of your business that can be improved and retrain your workers accordingly.

This can be accomplished in a number of ways, but many companies have found success by offering free e-learning content for employees or supporting re-training at institutions of learning. Arguably the best approach, and most hands-on approach, are retraining and upskilling opportunities that occur within the company itself. This approach helps you dial in on specific areas that need to be addressed, ensuring that your employees pick up the skills that will help them flourish at the company for years to come.

Closing the Automation Skills Gap for Good

Learning and development programs and training are highly effective measures if you’re looking to close the automation skills gap and embark on your automation journey. There’s no substitute for the real thing. Your workers have the knowledge, empathy, and unbridled freedom to do things automation could never, which makes liberating them from tedious tasks that much more important.

Are you ready to automate your company? IntelliChief, the emerging leader in Enterprise Automation, makes it easy to transition from manual processes to a fully automated workplace. We even train your team to get the most out of your system so you don’t miss a step during your Digital Transformation.

To learn more about how Enterprise Automation can take your business to the next level, contact IntelliChief today.

 

Automation Trends

3 Reasons the Enterprise Automation Buzz Is Building

Automation Trends

Automation was once viewed as the future of technology — then it became a reality. Today, automation has been scaled up and down to meet the daily challenges of organizations spanning countless industries across the globe. If you’re still in the camp that believes Enterprise Automation is just a trend, it might be time to take a second look at what Automation can do for you and your business.

Twitter. LinkedIn. Reddit. Wherever public discourse takes place, automation is trending in the @mentions. From 2016 to 2017, Adobe Digital Insights (ADI) performed a comprehensive analysis of 3 million social mentions related to “future of work,” such as automation and RPA. The researchers were able to attribute positive sentiment to the majority of these engagements. They weren’t talking about how automation would affect employment; rather, they were discussing the potential for automation to improve working conditions and increase productivity.

1. Automation Saves Valuable Time

It’s no secret that automation technology works faster than humans. It doesn’t need to “think” or “consider” letters or numbers before taking an action; instead, actions are taken automatically whether or not a human worker is available to push a process through to the next step. Automation doesn’t take sick days or vacations and it’s not limited to 40-hour workweeks or the costly constraints of overtime. Therefore, it’s unsurprising that in the analysis mentioned above, 30 percent of respondents mentioned saving time when discussing automation.

It might be a well-worn cliche, but there’s no hiding from the fact that time is money. With Enterprise Automation, you can assign menial, time-consuming tasks to automation so your team can focus on the things automation isn’t as well-equipped to handle. The days of manual data entry are over, and everyone is talking about it.

2. Automated Business Processes Yield Valuable Analytical Data

Still not convinced that automation is more than a passing trend? Consider this: 25 percent of automation-related conversations taking place on social media reference big data analysis as a primary driver for implementing automation. When business processes are automated, they gain the ability to automatically track productivity from start to finish, allowing C-level executives to glean valuable insights and make informed decisions on a rolling basis. No more waiting for the end of the quarter to figure out what went wrong and why. With real-time analytics guiding you, operational inefficiencies can be nipped in the bud to prevent your team from wasting time and resources that could be better allocated to other tasks or departments.

3. Humans and Automation Can Work in Harmony

Automation is often viewed as the harbinger of death for human jobs, but this is a gross overexaggeration that can be quickly disproven by examining how (and why) automation is being used by businesses all over the world. The average number of daily mentions of automation has doubled year-over-year. During that same period, the number of daily mentions of robots and jobs has increased by a staggering 70 percent year-over-year. However, to truly understand why this bodes well for humans and automation alike, we need to break into the meat and potatoes of these mentions to truly understand their sentiment. Here are a few examples:

 

Needless to say, the automation buzz is building — and for good reason. The automation “trend” has taken root and it’s not going away anytime soon. Organizations that can work faster and more efficiently while simultaneously cutting costs and improving work-life balance for employees have already taken the necessary steps to prepare for a future where traditional working arrangements are no longer viable.

Enterprise Automation: Once a Trend, Now a Requirement

Before the automation trend really took off, it was considered a luxury for enterprise leaders who not only had the infrastructure to support it but also the growth capabilities to afford it. Today, this is no longer the case. Automation technology and software have been retooled to boost business across all marketplaces. From start-ups to SMEs and beyond, automation is a difference-maker the likes of which we’ve never seen before, especially for large enterprises that can benefit from an integrated solution across multiple departments and locations. The automation trend is here to stay, and IntelliChief’s experts are standing by to ensure that your automation project capably addresses your challenges and helps you become more resilient (and profitable).

To learn more about Enterprise Automation or to see our products in action, contact IntelliChief today.

Business Process Automation Benefits

4 Benefits of Business Process Automation in the Workplace

Business Process Automation Benefits

Automating inefficient, time-consuming products has become essential in every industry in the United States. Whether you are a project manager working in construction or an Accounts Payable professional for an enterprise-class manufacturer, automation can help you forge a path forward during one of the most challenging economic periods in American history.

 

According to a recent Harris Poll survey, Accelerating Automation: How Businesses are Adapting to a Post-COVID World, “92 percent of business leaders agree that to survive and flourish, companies must enable digital channels and process automation in the workplace.”

As a business leader, your reasons for automating your company will differ drastically from those of others. Some automate to cut costs, while others do so to help control the workload being placed on employees. If eliminating costly transactional errors is your objective, automation can help with that too.

Business process automation benefits can be a significant game-changer for your company. In this article, we’ll briefly discuss four benefits of business process automation. Keep in mind that these benefits are NOT mutually exclusive.

1. Meet and Surpass Your Growth Objectives

At the end of the day, every business has the same goal: growth.

Whether you want to grow to generate revenue, to spread your message, or to give yourself the tools to make a positive impact on the world, the most direct path to your goal is through growing your business – and business process automation gives you an array of tools to do just that.

The initial cost barrier of automation can be a tough pill to swallow; however, just beyond this initial investment lies an endless bounty of opportunity for businesses that decide to take the risk. Ironically, the risk of not investing in automation for the workplace is significantly higher – especially if your competitors are already getting their own automation projects underway.

Once your competitors automate their companies, you must begin calculating the opportunity cost of your decision to not automate, including:

  • Stifled profits
  • Overburdened employees
  • Erroneous processes
  • The rising cost of paper and storage
  • Lost market share
  • A growing gap in the capabilities of you versus your competitors

After you have justified your investment with the help of an expert, you will be able to forecast your ROI and create a plan to help you scale your solution into the future. With your company firing on all cylinders and productivity elevated by as much as 90%, you can rest assured that your company will continue to meet its growth objectives year after year.

2. Reduced Time to Fill Keeps Productivity at Peak Levels

Whenever an employee decides to quit or retire, they will leave a void in your business process that must be filled with another employee who possesses the same or similar skills and knowledge to complete the job at a high level.

If that role is unable to be filled, the responsibilities of that employee will fall squarely on the shoulders of your other workers. An overly long time to fill can cripple productivity and create bottlenecks in your workflow.

Automation can help you eliminate issues caused by an excessive time to fill. Better yet, it can bridge the gap when an employee leaves for good. If there’s no other candidate out there who can capably do the job or a lack of qualified talent, automation can nullify the impact.

3. Cultivate an Employee-Friendly Working Environment and Improve Retention

As a business leader, you are not only at war with your competitors when it comes to dollars and cents, you are also battling over the top talent in your industry. If your employees report being overworked or overburdened, regularly being tasked with taking on multiple duties or a large volume of manual tasks, they could be heading for greener pastures sooner than later.

The competition in the recruitment market is one of the least talked about struggles facing all employers, but that does not diminish its impact. The best way to avoid this obstacle is to retain employees, and the only way to retain employees at a high rate is to ensure that your working environment supports your employees and is willing to make necessary changes to improve retention.

Here’s the thing: Shallow improvements to the workplace, like installing pong tables and vending machines, won’t actually help you retain workers. Bells and whistles are nice, but they won’t help your workers relax if they are constantly working on repetitive or menial tasks.

Business process automation benefits your working environment because it takes on redundant tasks, freeing up your workers to focus on more meaningful responsibilities or those that require some form of creative problem-solving. Workers that arrive each day with a sense of autonomy over their work-life balance feel valued, which means they are more willing to stay with a company in the long run, as opposed to employees who constantly feel anxious or depleted.

4. Unheralded Efficiency Drives Your Business Past the Competition

Companies that focus on maintaining efficiency across all areas of their business generally have a leg up on the competition. They outfit themselves with superior technology that allows them to establish streamlined companies that waste very few resources. Take Tesla for example, which is now considered the most valuable car company on the planet despite being founded in 2003. Not only is their product more efficient, but their entire business model is also structured on the principle of efficiency.

Efficient processes ensure that information flows in and out of your business without any interruptions, resulting in faster transactions and increased operational bandwidth. For the enterprise, this is achieved by forming a seamless integration with the Enterprise Resource Planning (ERP) system at the core of the business (i.e., Oracle E-Business Suite, Oracle PeopleSoft Infor LX, JD Edwards World, etc.). Once integrated, business process automation software can help you reclaim the 520 hours per year lost to repetitive tasks per employee.

Your company can cash in these hours on new projects, additional training, and other important organizational benefits. Repetitive tasks that could be automated cost the US economy over $10,000 per employee each year. How many employees does your company keep on its payroll? How many “invisible” dollars are you really losing? And how do these dollars lost compare to the dollars gained after investing in automation?  These are important questions that should be answered with the help of an expert who has experienced implementing automation in the workplace.

Automation in the workplace can help you establish stronger and more resilient business processes to help you become an industry disrupter? Contact IntelliChief today to learn more about the benefits of business process automation.

IntelliChief

4 Common Matching Issues for Major ERP Systems

 

Is there anything more frustrating than footing the bill for a fraudulent or inaccurate invoice? For years, business owners have struggled to give their Accounts Payable (AP) departments the tools they need to prevent invoice processing errors related to manual data entry, duplicate invoices, and faulty exception handling — and it’s starting to take a toll on several industries.

According to Infor, “approximately 0.1% to 0.05% of invoices paid are typically duplicate payments.” In other words, a business that grosses $150 million per year could lose as much as $750,000 to duplicate payments over a five-year period. This “lost” money could have been invested in training, bonuses, infrastructure, and virtually anything else businesses need to succeed. For most businesses, utilizing a 3-way matching process is a reliable way to cut down on matching errors, but it can also lead to additional Accounts Payable challenges.

In theory, a true 3-way matching process matches not only the invoice and purchase order but also its corresponding receiving information, thereby eliminating the chance for duplicate payments and counterfeit invoices. Unfortunately, this process can be a hindrance for businesses that aren’t equipped with the tools to process invoices quickly and accurately. For instance, some enterprise resource planning (ERP) systems require the processor to manually check to ensure that all related documents have been received to approve the 3-way match and complete the AP process. Another common ERP-related issue is a system’s inability to read purchase orders (POs) and receipt tables, rendering automatic voucher creation an impossibility.

IntelliChief, an Infor solution partner and Oracle Gold Partner, was built to overcome these limitations with unparalleled workflow automation and invoice matching capabilities. Unlock your team’s true potential by eliminating pitfalls in your existing AP process and watch productivity soar as you reduce manual exception handling by as much as 50% or more.

Issue #1: Workflow-Restrictive Implementation

Too often we find that enterprise-class software wants your business to play by their rules. Whether you’ve been in business for one, ten, or one hundred years, your existing business processes should be respected and considered whenever new technology is incorporated into your workflow. One of the major detractors of point solutions that aim to address a single issue is a lack of flexibility. You can’t apply their technology to other departments or workflows, and you must mold your existing processes to “play nice” with their system.

IntelliChief is unique because it is an enterprise content management (ECM) platform that integrates directly with your ERP system and can be configured to your exact business processes. Whether you utilize a 2-, 3-, or 4-way matching process, IntelliChief can be configured accordingly to help you reduce lag time and AP errors.

Issue #2: Queued Matching

How do you streamline a process that grinds to a halt every time something unfamiliar enters your queue? On top of that, how do you ensure that easily processed documents aren’t trapped behind a wall of exceptions? Realistically, utilizing any sort of queue in your process will lead to slowdowns and additional Accounts Payable challenges. For example, if your team members must enter an invoice to see if the receiving has been completed, it’s only a matter of time before your entire system is bogged down.

As an Infor Solution Partner and Oracle Gold Partner, IntelliChief matches invoices in real-time to help businesses avoid late fees while capitalizing on opportunities for early payment discounts. Exceptions are routed into workflow and automatically processed once the system has enough confidence in a match or recognizes that it’s within your tolerances. Any exceptions that fail the confidence test are then routed to a user for manual approval, leaving only your most pressing (and real) exceptions to be handled by your AP department.

Issue #3: No Unit of Measure Conversion Capabilities

Reducing the number of exceptions in your AP process is a surefire way to increase productivity. Whenever your processors are forced to deal with an exception, they are committing extra time to a particular transaction regardless of its value. Whether a transaction is worth $1 or $1 million, every additional second your team requires to process it is being siphoned directly from your bottom line.

Unit of Measure Conversion

IntelliChief finds the match even when item numbers, quantities, and unit prices don’t!

Therefore, if you can reduce the amount of time spent handling exceptions, you can realize significant cost savings. IntelliChief can automatically perform unit of measure and part number conversions to reduce exceptions. For example:

  • Lithium grease can be purchased in a drum or a 5-gallon bucket. There are 55 gallons in a drum, which means there are 11 buckets in a single drum. If the invoice and purchase order express this amount (i.e. one drum) in different terms (i.e. one drum vs. eleven buckets) it will result in an exception and require manual intervention to process. IntelliChief utilizes a cross-reference matrix to automate these conversions, eliminating the need for manual approval.
  • Steel is often purchased in coils while copper tubing is more commonly purchased by the 20-foot section. Similarly, steel pipe is regularly purchased in 44-foot rail lengths but used by the inch or square inch. When suppliers and purchasers have different expectations about how a material will be utilized, it can lead to unit of measure normalization issues. The final product is ultimately the same, but your AP processors can’t be certain without checking manually. IntelliChief eases the burden of this complicated process by handling the conversions for you and eliminating this step altogether.

Issue #4: Lack of Support for Workflow Automation

By addressing the above concerns with an industry-leading ECM solution like IntelliChief, your business can take advantage of faster processing times and fewer exceptions. It allows businesses to accelerate invoice or customer purchase order processing by eliminating manual intervention and automating your workflow. Even complex matching procedures, such as those involving blanket POs, are no problem for IntelliChief.

As soon as your information enters the system, a 2-, 3-, or 4-way match is performed automatically. With normalization and cross-referencing, the number of transactions that require manual intervention is reduced even further. IntelliChief Capture Enterprise users can even unlock the ability to use straight-through processing, which allows invoices to be processed without any manual entry or intervention from the beginning. As the statistics below prove, the leap in productivity is nothing short of alarming:

Without Normalization/Cross-Reference

  • 260 Total Invoices
  • 141 Processed Straight Through
  • 119 Required Manual Intervention
  • 54% Straight to Voucher

With Normalization and Cross-Reference

  • 260 Total Invoices
  • 254 Processed Straight Through
  • 6 Required Manual Intervention
  • 97% Straight to Voucher

With IntelliChief, you can reduce the burden of exception handling on your AP team, reach unprecedented processing speeds, and decrease the number of errors in your process by a wide margin. Even when your team is out of the office or unavailable, IntelliChief continues to process transactions in real-time from start to finish.

Overcome Your Accounts Payable Challenges With IntelliChief

There are many benefits for businesses that rely on 3-way matching, including stronger supplier relationships, increased profitability, and superior preparedness for financial audits. However, businesses that don’t automate this process are often overwhelmed with the time- and labor-intensive nature of manually performing 3-way matches. In order to scale this process as you grow your business, automation is critical. With IntelliChief, there’s no limit to how many documents you can process — even when the office is closed — thanks to robust automation capabilities that learn (and master) your business-critical processes.

To learn more about how IntelliChief can help your business overcome its Accounts Payable challenges with industry-leading workflow automation and document management solutions, contact us today.

 

How to Reduce DSO: 7 Strategies for Better Accounts Receivable Management

You’ve run the numbers, looked at previous metrics, and realized that your DSO is higher than it should be. You may be seeing the impact on your day-to-day cash flow, or you could simply be trying to get ahead of future problems. Either way, you’re looking to reduce your DSO – and the following strategies can help you get there.

Step 1: Set Realistic DSO Targets

In a perfect world, customers would pay right away. But, the reality is, most companies need several days – if not several weeks – to collect and verify their invoices, get approvals, and schedule payments.

To decide on a target DSO, you’ll want to consider the average for your industry, as well as how long it typically takes your company to convert receivables into cash. (This article takes a deeper look at using your DSO as a KPI.)

If your current days sales outstanding is 90+, you won’t be able to get to 30 days overnight. A more reasonable initial goal is an improvement of 10-15 percent. That means reducing your DSO to 77-81 days if you’re currently at 90 days, or getting to 51-54 days if you’re currently at 60. Once you’ve met this initial target, you can re-evaluate your cash flow and decide if you still need to improve.

Step 2: Review Your Payment Terms

A typical guideline for accounts receivable management: your DSO should be within 15-20 percent of your stated payment terms. Once you’ve figured out how much you need to reduce your days sales outstanding, you can re-evaluate your payment terms to make sure they align.

When looking at your payment terms, you’ll want to look at more than just the period of time that your buyer has to pay the amount that’s due. You can also look at:

  • Early payment incentives (such as a 1 or 2 percent discount for paying within 10 or 15 days)
  • Late payment penalties
  • How you’re asking to be paid (electronic options let you access payments right away, instead of waiting several days for a check to come in the mail – although some of your customers might not be willing to adopt new technologies)

 

Step 3: Get Better at Credit Risk Management

Your payment terms go hand in hand with your credit practices – which are equally important to consider when you need to reduce your DSO.  If you’re too lenient, you take on a greater financial risk – but if you’re too strict, you may be missing out on potential business.

When you review your credit policy, be sure to consider:

  • Your company’s overall financial risk tolerances
  • What criteria customers need to meet to be approved for credit
  • How you plan to process each application (e.g. using a third-party company for a B2B credit check, or requesting more references from new customers)
  • How you plan to resolve delinquent accounts (from preliminary communications through collections)

You’ll also want to consider whether credit policy changes could actually increase your DSO, rather than reduce it. For instance, if you add more paperwork or more extensive credit checks to your process, you’ll likely spend more time on accounts receivable management upfront. However, if the time you spend on this step is less than the amount of time (and money) you’d spend dealing with delinquent accounts, it may be worth the trade-off.

And remember: you don’t have to decline business from customers you deem too risky. Instead, you can consider options like pre-payment, cash on delivery, or a partial up-front deposit.

Step 4: Improve Your Invoicing Practices

Once you know how you plan to reduce your DSO, you’ll need to communicate your new policies very clearly to your customers. That may mean updating your invoice template to put the due date and preferred method of payment front and center.

There’s also the issue of getting delivered to the customer right away. (After all, if your customer hasn’t received an invoice yet, there’s nothing for them to pay!)

If you currently wait for customers to receive their purchases before you send your invoices, you could start sending invoices after each order has shipped. You could also consider emailing your invoices to speed up the process even further.

There’s also the option of automating your invoices, but we’ll get into automation a bit further on.

 

Step 5: Improve Your Collections Practices

Even though most customers pay on time (and those miss the first deadline do usually follow through in the end), companies still need to have a documented debt recovery policy in place. This ensures that you know what to do in a worst-case scenario (and that you spend as few resources as possible on the process.)

One of the most common customer responses on a collection call is “I never got that invoice, can you send it to me?”  Employees then have to get off the phone, reprint the invoice,  re-scan it, and re-email it out.  Implementing an enterprise content management system can give the user access to the invoice while the customer is on the phone, and the customer can receive the invoice immediately.  This allows the AR team an opportunity to come up with a payment plan for the customer right then.

For the most part, one or two friendly reminders are usually enough to get a customer to address an unpaid invoice. (Be sure to keep complete documentation of all your communication attempts – in the event that you do need to send the account to a collections agency, this will make the process smoother.) But, if multiple reminders go unanswered, it may be easiest to turn the account over to the pros. That way, you can go back to focusing on more financially valuable accounts.

Step 6: Increase Visibility

Reducing DSOs is a collaborative effort. Credit managers, financial analysts, and CFOs all have their own role in the process – and they all need real-time information to make more informed decisions.

An unpaid invoice report is a great place to start – but they’ll need to look much deeper to get to the bottom of your high days sales outstanding. Visibility is crucial; your team needs to know which customers are late to pay, whether there’s any correlation with your company’s sales patterns, and whether you’re doing anything internally to hold up the process. If you don’t already have a reporting process in place, consider investing more heavily in a system that’ll let you create a more accurate cash flow forecast.

Step 7: Consider Automation for Effortless Accounts Receivable Management

At the end of the day, managing your receivables is a time-consuming process. Anything you can do to make it easier can have a positive impact on your cash flow.

AR automation is one way that you can speed things up. Instead of having an employee create invoices, confirm each company’s billing information, and print and send your paperwork, you can let an automated system handle everything for you.

Companies that automate their order to cash processes are usually able to reduce their DSOs within a few months. Their customers get their invoices faster, don’t have to worry about duplicate charges, and spend less time contacting customer service. Internally, these companies can eliminate repetitive processes and free up their accounts receivable team to work on more important projects.

Let IntelliChief Help You Reduce Your DSO and Improve Your Accounts Receivable Performance

Ready to improve your approach to accounts receivable management? IntelliChief can help. Our business process optimization team can help you automate your most time-consuming workflows. We’ll recommend ways for you to reduce your DSO, increase your cash flow, and process your receivables with less effort from your team.

Are you ready to work smarter, not harder? IntelliChief can help. For more information, contact us today.