I’ve recently spent some time reviewing OB10’s new e-book, “Rooting Out Invoice Exceptions: The Path to Straight-Through Processing,” and have found its insights succinct and compelling. The e-book puts forth some of the simplest and most persuasive arguments I’ve seen in favor of invoice automation, changing the role and orientation of AP in general and creating tighter linkages between procurement and finance systems and processes.
On the topic of straight through processing and error rates, author Danny Thompson frames perfectly the argument for taking compelling action when he observes the following:
“For many of us who have been around the P2P process for years, there is a tendency to resign ourselves to believing that invoice exceptions are simply part of doing business … [but] the world has changed, and we now have the technical capabilities that make 100% STP [straight through processing] – with a few logical exceptions – highly achievable. There is no reason that the P2P process– which cuts across large cross sections of every organization – should not be held to the same standards that are applied to a manufacturing line or a customer service operation, where defect rates between 20-40% would simply not be tolerated.”
Of course achieving this nirvana is easier said than done, especially given the serious challenges that AP and procurement organizations face not only in driving 100% user and spend adoption for eProcurement, direct spend, VMS and e-invoicing systems, but also in deploying supplier onboarding programs and network connectivity that can capture the long tail of SMB suppliers. Yet many of the approach and recommendations outlined by Thompson provide a useful place to start.
We’ll explore some of these recommendations in a follow-up post.