Multi-million dollar projects + multiple suppliers = LOTS of invoices. Mid-size operators are faced with an average of 30K+ invoices each month. Each invoice must be routed through the appropriate approval processes, validated and matched against a Purchase Order, and then paid within mutually agreed upon terms & conditions.
In a depressed commodity market, cost-cutting and operational efficiency take center-stage.
Yet many Operators still maintain a high headcount to support manual invoicing processes. The sheer number of “touches” or hand-offs required for the manual process leads to common challenges:
- Invoices “lost” in process
- Difficulty for both the Supplier and Operator to track the status of the invoice
- Limited insight into supplier A/P backlog
- Management unable to drive accountability
Optimizing with Process, Technology, and Accountability
To help simplify this core business function, you not only need technology that allows for automation and collaboration across multiple business departments (e.g. Supply Chain, Finance, Tax) but also, streamlined processes that drive accountability and results.
Automating business rules, routing, and PO matching/validation leads to more productivity & less headcount. Business rules route the invoice to the appropriate party and automated workflows deliver information to the right person at the right time. Storing, tracking, and managing invoices with technology-enabled workflow reduces the risk of fumbles during process hand-offs. Management gains real-time visibility into the entire process lifecycle and also benefits greatly from enhanced reporting. Accurate and timely insight into A/P backlog enables Finance to optimize cash management.
Becoming a better Customer allows more value to flow through the chain from Suppliers.
Most importantly, these improvements enable a stronger relationship with your Suppliers. Optimizing your processes make you more efficient to do business with. Suppliers can provide more value (e.g. lower overall costs/rates) by taking out the cost of doing business with an inefficient Customer.
The next opportunity your firm has to evaluate Supply Chain Optimization opportunities, consider that value flows both ways.