Moderated by Niharika Sharma, Head of Marketing at Hyperbots
Niharika: Good morning and welcome to today’s discussion, everyone. In the realm of finance and operations, the quest for efficiency is ever-present, with organizations constantly seeking to streamline processes and optimize resources. One area that stands out as both critical and challenging is the end-to-end straight-through processing of invoices. Today, we are joined by Anna Tiomina, an experienced CFO who will shed light on why achieving this goal remains a significant technological challenge. Anna, thank you for joining us today. Could you please start by explaining why achieving end-to-end straight-through processing of invoices is still such a formidable task?
Anna Tiomina: Good morning. Thank you for having me here. Yes, indeed, in spite of all the technological progress and advancements, manual invoice processing is still prevalent in many organizations. I came across research by Arden Partners, which said that approximately 40% of businesses still rely on manual methods for processing invoices. The primary reason for that is the complexity of the invoicing process itself. From the moment an invoice is received to its final payment, there are multiple touch points, many stakeholders involved, and many points of failure along the way. Each step involves various systems, checks, formats, and levels of human intervention, which introduces complexities.
Niharika: Can you elaborate on some of the specific challenges involved in achieving straight-through processing?
Anna Tiomina: Yes, certainly. One of the key challenges is data quality. Invoices come in various formats through different channels. Sometimes they lack standardization, and sometimes they lack specific information, so you need to do a lot of data preparation to make it possible for an automated process to take these tasks. Even with advancements in optical character recognition or data extraction technologies, there are still a lot of errors and discrepancies when using technology to extract data from invoices. Another challenge is integration. Many organizations operate in different systems for procurement, accounts payable, and ERP, and achieving seamless integration between these systems to enable end-to-end automation is a complex task. It requires a lot of customization and testing. And last but not least, compliance and regulatory requirements add another layer of complexity. Invoices must comply with tax regulations, accounting standards, and internal policies. These may vary across jurisdictions and industries, and ensuring that automated processes adhere to these standards and requirements without compromising efficiency is a huge challenge.
Niharika: Right, it seems like there are multiple layers to consider in this case. How do you envision overcoming these challenges?
Anna Tiomina: Yeah, that’s a very good question, and it requires a 360-degree approach. Companies can start by investing in advanced technologies, such as artificial intelligence or machine learning. This can improve the accuracy and efficiency of invoice processing. These technologies can also help to improve data extraction and decision-making as they learn from historical data and previous mistakes, reducing the need for manual intervention over time. There is a learning curve when using these technologies. Secondly, to make this work better, organizations should focus on standardizing processes and data formats to streamline integration. For some organizations, this is an easier task, but for others, it’s more challenging, especially when they operate in a versatile market environment and work with many vendors from different industries and types of companies. Here, collaboration with external partners and vendors becomes essential. Working closely with suppliers and service providers, organizations can establish common standards and protocols for invoice exchange, which will, in the future, reduce friction and complexity in the invoicing process.
Niharika: Fascinating insights. As we wrap up, what do you see as the future of end-to-end straight-through processing of invoices?
Anna Tiomina: Well, I think that with the current advancements in technology, especially in the field of artificial intelligence, this is becoming a much more attainable task. At this point in time, organizations should invest in exploring these new technologies, ensuring that their internal processes are well prepared for the adoption and integration of these new technologies. With further integration of AI-driven solutions, companies will have many more opportunities to achieve an end-to-end STP process, automating all the steps along the way. This will reduce costs, enhance transparency, compliance, and overall business agility. So, I feel very optimistic about this, and I hope that the 40% of organizations relying on manual processing will be reduced to a maximum of 5% in the next couple of years.
Niharika: Thank you for answering that for us, Anna. I think the discussion has been very fruitful. Thank you for the valuable insights, and it’s been a pleasure speaking with you today.
Anna Tiomina: Thank you. Thank you for having me.
