For example, invoice number, PO number, where to send the payment to, and payment terms should always be included. Strict rules should be set for your vendors for invoice submission. Invoices are routed to the relevant approver based on information provided in the invoice, such as product, department or amount.
With your invoices arriving all in one place, the portal can then be configured efficiently. Having a centralized mailbox for incoming vendor invoices is vital to the success of any automated invoice approval workflow. When choosing an AP solution, there are some important features that will enable you to maximize the effectiveness of an automated invoice approval workflow.Įlements of an Effective Invoice Approval Workflow Organizations need to embrace technology and look to automate their AP process and enable invoice workflow automation.
DEFINE INVOICE APPROVAL MANUAL
Manual invoice approval processes clearly leave organizations exposed to many issues that can prove both costly and time-consuming. In a manual environment, AP teams struggle to spot such duplications, considering the sheer number of invoices that they are dealing with. In some cases, the same invoice will be sent again, potentially resulting in a duplicate payment being made. As a result, when it comes time to negotiate, improving contract terms becomes practically impossible.įurther issues arise when a payment is delayed without communication regarding the reason, as the vendor may conclude that the invoice has gone missing. If you do not pay your invoices on time, you may lose preferred status with certain vendors.
This can result in late payments, which both negatively affect your organization’s cash flow but can also damage vendor relations. The more paper-based invoices that need to be sent for approval, the slower the overall process is likely to be. With more AP teams working remotely than before, the need to print, sign and scan large amounts of invoices at each stage of the approval workflow has become nearly impossible to manage. In this blog, we will take a closer look at the challenges for AP teams with manual invoice processing before outlining the elements of an effective automated invoice approval workflow that you need to consider when researching solutions to automate your AP processes.Īs mentioned, one of the biggest challenges with a manual invoice processing workflow is the sheer number of paper-based invoices involved.
Missing invoices, unanswered emails, and payment delays are just some of those challenges. According to Levvel Research’s Payables Insight Report, an invoice approval workflow that relies on manual routing of invoices ranks as one of the biggest challenges in accounts payable – and is more common among organizations that have yet to embrace accounts payable automation.ĪP teams that have yet to make the switch to automation will be all too familiar with the struggles that a manual invoice approval process brings.
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