ADP: An E-Invoicing Alternative Across Industries (Part 4)

- February 13, 2013 7:36 AM
Categories: Technology | Tags: ,

ADP’s new coding capabilities are a further attempt to increase both accuracy as well as straight-through processing success. Enhanced capabilities now include the ability to drive predictive coding as early as possible in the invoicing workflow. The concept, as ADP shared, is that “the system learns as more invoices are processed instead of relying on defaults that were specified at the time of implementation.” ADP takes historical coding that has been attributed and applies it to future invoices that are being submitted.

Essentially, as invoices are coded by the AP department, the solutions stores the details, which can be highly granular by fields (countries, locations, etc.) After the capability is configured, when a new document comes in, the solution codes and flags fields requiring manual entry. The granular nature of the smart coding (tied to the complexity we’ve already covered that the solution was originally required to support in the oil and gas business) is what causes is more interesting to us.

In looking at the smart coding in practice, ADP shared an example involving multiple fields including product/service type, charge types, descriptions, tax numbers, etc. On a typical invoice with many line items for oil and gas, the solution coded fields for different types of services and goods, including piping details, connectors and installation services. Specialized labor (e.g., welding) with its own fields can also be enabled (but was not in the demonstration). The system can also support fields that might be customized to a particular site, requirement, or supplier (activity type, cost center type, etc.)

ADP’s enhanced document routing capability also allows users to configure interconnected routing rules that enables invoices and related documents to be forwarded based on linked details. The initial release has users configuring rules via an Excel sheet that is then uploaded into the system. The Excel-based coding interface allows users to even include specific error messages that can go to someone (e.g., a supplier) based on actions (e.g., rejection for a specific reason).

We walked through a detailed demonstration of the creation and uploading of rules from Excel and at this stage it’s clear that while the solution is quite feature rich, configuration outside of the application itself reduces the elegance of execution (and could potentially limit the number of users who opt to use this capability). We suspect ADP will complement the Excel-based routing configuration with an application specific configuration in the coming releases.

Still, the solution offers a highly granular degree of routing capability. For example, ADP showed how a set of rules might include different routing based on a PO-look up with different matching requirements (e.g., 2-way vs. 3-way) that can then set off different routing requirements. In another more specific case, a user might opt to configure a routing rule based on invoice price variance from purchase order, setting off a specific set of workflows.

The final element ADP added in its latest release was enhanced document management capability based on the same underlying rules engine (which ADP built internally) of the routing capability. This includes the ability to manage different document types and applying specific business rules to a document based on underlying source data or metadata tied to a supplier, PO or contract.

Overall, Spend Matters believes that these enhancements bring ADP’s solution up to the level of e-invoicing specialists with a more established global footprint. ADP clearly followed the adage “good should not be the enemy of the great” in rolling out features, such as the new routing capability, which are functionally effective if not elegant in execution in the initial release. Still, we’d take Excel-based configuration that works over a clunky and buggy browser-based rules configuration engine any day.

For comparative analysis, recommendations and further observations on ADP’s e-invoicing capabilities today – including what types of organizations we believe are best suited to the solution set – please read our ADP analysis on Spend Matters PRO, coming soon.

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