Yooz COO Laurent Charpentier talks with Mary Schaeffer, host of AP Now Podcast, about the benefits of going paperless and digital.
DALLAS, Tx. Automating a company’s accounts payable process from purchase to payment offers a host of benefits, from lower costs, shorter cycle times and catching duplicates to turning the AP department into a strategic asset for the entire organization. As Laurent Charpentier, COO and CIO of Yooz, Inc., North America, told listeners of the popular AP Now podcast hosted by Mary Schaeffer, the secret to success is an all-in-one solution that manages a touchless invoice process from purchase to payment.
“A lot of companies are still paper-based and think they have automated their AP process when they scan and email invoices to each other. That’s not automation and it’s not accelerating the process,” Charpentier explained on a segment of Schaeffer’s “AP Technology Week” special. “True automation starts with capturing invoices by using machine learning and smart data extraction to eliminate manual data entry.”
That kind of digital transformation solves several common problems of the AP process. It significantly reduces lengthy and costly invoice approval times. The average turnaround for an invoice today still hovers around four weeks, said Charpentier. Paper-based processes lead to errors, frustration, and ultimately require human intervention.
A second problem, he told Schaeffer, is the high number of exceptions. Nearly a quarter of all invoices are flagged for irregularities that will require AP staff to take action and perform additional work in order to get them approved. Too often, duplicate invoices with identical or slightly different invoice numbers slip through. “With a manual process, we see up to 3% of all payments being duplicate payments. Many are never caught, which is a cash loss for the organization,” Charpentier said.
As a first step, he encouraged companies to leverage their accounting system’s built-in features to prevent an AP clerk from entering the same invoice number twice. Even before embarking on AP automation, that simple precaution is often not enabled. The best way to reduce duplicates and outright fraud, Charpentier added, is intelligent automation with a platform such as Yooz. Yooz performs a three-way match between purchase request, purchase order and invoice. It also uses smart rules that each company can define to check up to six different data points on every invoice before routing it onward for approval.
AP automation has demonstrated its value, particularly during the pandemic. It saves valuable staff time and ensures business continuity but also catches duplicates, added Jamie Radford of the UK-based AP Association who also shared his insights on the show. “During the last 12 months, a lot of businesses struggled to get paid and resent a lot of invoices.” Having a combination of the right technology and trained staff made the difference to process the correct invoices quickly, both he and Charpentier agreed.
Smart automation with a platform such as Yooz also solves two other problems that many AP teams complain about: addressing time-consuming vendor queries and handling checks. “It’s a real lack of visibility and real-time data when staff have to answer phone calls while a piece of paper is sitting on someone’s desk,” Charpentier said.
Automation offers drastic improvements because documents are indexed and securely stored in the cloud the moment they arrive, offering full traceability and instant search. Equally important is the capability to initiate electronic payments through the payment partner of choice. Not cutting paper checks reduces the possibility of errors, delays and outright fraud and helps secure early-payment discounts.
The end result of all these process innovations is a more strategic role for the AP team, Charpentier reminded Schaeffer and her audience of AP professionals all over the US. The information that the AP process generates, from real-time views into current liabilities and payment timing to supplier performance can be critical.
“AP functions can drive growth for the entire organization and make the accounting department more strategic,” the Yooz COO stressed. “My message to all AP teams is: Don’t fear losing your job. Automation will reshape it and make it a lot more interesting.”