How invoice automation can help you create a paperless office
Imagine your business was 100% paperless. Before you start reading, take a moment to picture your work environment completely devoid of printouts and copies, staplers and paper clips, and printers and shredders. No file cabinets, no magazines or newspapers lying about on desks or the reception area. You can’t avoid mail, but let’s say you scan and recycle all paper invoices, receipts, and other business documents as soon as you receive them.
Whether you find this easy or difficult to envision, you’ve probably got an idea of the advantages of such a scenario.
Automated invoice data entry: A little less human, a lot more effective
Discover the highs and lows of manual invoice data entry from a former data entry clerk as he breaks down the realities in a more personal way.
One of the most important departments in your enterprise is your accounts payable (AP) team. The AP team is responsible for capturing the data from invoices, coding invoices, connecting invoices with purchase orders, and posting for payments. Without this valuable work, organizations would not be able to purchase or pay for supplies.
There are three main documents in the accounts payable workflow. These are the purchase order (PO), the receiving report (or receipt), and the vendor invoice. The last document on that list is the one that we will take a closer look at today — the invoice.
Most organizations have experienced this cycle hundreds of times. Nonetheless, here is a summary of the cycle. The buying organization makes a purchase from a vendor. The vendor then creates an invoice and sends it to the buying organization. The accounts payable department in the buying organization is then responsible for processing that invoice and sending it to the accounting department where it is then paid for.
For years, invoices have been processed manually. This means that thousands of people all over the world put thousands of hours into this tedious process every single day. The valuable time of teams is being wasted by these manual processes which are error-prone and demotivating for your AP talent.
Some businesses have seen this problem and have attempted to address it using template-based OCR invoice programs. OCR is short for optical character recognition and refers to a kind of software that can automatically detect and capture data within scanned images of business documents. It works by the program doing invoice segmentation, where the image of the invoice is divided into just the regions containing data. These systems have created more efficiencies but have also introduced their own flaws, which can be severely difficult to manage. The true breakthrough in OCR invoice management is cognitive OCR, which uses machine learning technology to extract the invoice dataset with more speed and accuracy than any system before.
Invoice data extraction software
Invoice data extraction software was first developed as a way to address the inefficiencies and other problems associated with manual data entry. With OCR invoice to Excel technology, the data within invoices could be scanned, extracted, and then easily sent to an Excel spreadsheet for use later on. OCR addresses a fundamental problem with how business data is currently stored.
Research has shown that 80% of all business data is embedded in unstructured formats such as business documents, emails, images, and PDF documents. Unstructured data cannot be used or understood by computers or applications. This is why manual data entry was so important for so long. It was the job of employees to take the unstructured data and convert it into structured data formats that various business software could understand. Template-based OCR software automated this task to a certain extent.
However, this kind of OCR software can only automate about 50% of the tasks associated with data entry. Template-based OCR requires expensive experts to spend hours creating new rules and templates for every single variation of every single document you want to process. A cognitive OCR software can extract invoice data from PDF files quickly and efficiently. Moreover, it can accomplish this with unparalleled accuracy. If you want to know how to convert PDF to Excel without losing formatting, look no further than an effective AI-enabled OCR platform.
Thanks to machine learning, OCR can automatically detect new variations of documents and automate up to 90% of document processing tasks. This means that hundreds of invoices can be processed rapidly and accurately, leaving your AP team more time to focus on the strategic initiatives that matter to growing your organization.
OCR in invoice processing
The purpose of AI-enabled OCR platforms is to reduce the paperwork burden on accounts payable teams and enable complete automation opportunities. The best OCR invoice processing programs can extract data from invoices and export it to your accounting system in minutes.
The way this often starts when it comes to OCR in invoice processing is you create some kind of account and log into the platform (if it’s online). You then decide what kinds of data fields you want the system to export from the invoices. Rossum, for example, makes this easy by allowing you to simply check and uncheck the boxes to decide which fields to extract. After that, you’ll load your invoices (one, or hundreds) into a queue.
These are often uploaded to an OCR system in PDF or image formats. As soon as the documents are uploaded, the data is captured. This whole process often takes less than one minute to complete even if you’ve uploaded hundreds of invoices. Following that, excellent OCR software provides an easy-to-use validation interface to quickly and easily validate the data before extracting it and sending it to its destination.
Extracting structured data from invoices can be easy when you use the right kind of OCR platform. However, to fully automate the invoice processing workflow, your OCR platform needs to be connected to your accounting system, so that the data can be seamlessly transferred. In order to design such a software bridge, an effective invoice OCR API is needed.
Invoice OCR API
Once the data has been extracted and captured from an invoice, there are three options for how you can get the data over to your accounting system. The first option is to just do it manually. In this method, you export the data from the invoice into a structured format like Excel. Then, you manually upload this data into your accounting or ERP system.
The second option is to use an invoice OCR API. API is short for Application Programming Interface. If your OCR platform provides an API, your own software engineers can build a custom integration between your OCR engine and your accounting or ERP system. Rossum’s API, for example, makes it easy to build an invoice OCR Python integration for any kind of accounting software. The best OCR API is straightforward and allows you to set up the integration in a matter of hours and not days or weeks.
The third way to connect your OCR platform to your accounting system is to use robotic integration. This is the easiest way to integrate but only works if your preferred OCR platform is compatible with a Robotic Process Automation (RPA) platform. The goal of an API should be to provide flexibility to customers so that they can build the solutions they need to improve their processes.
Invoice OCR software
Online OCR software has another huge advantage over traditional manual data entry workflows. Because it is based in the cloud, invoice OCR software can give you 24/7 visibility into all your document-based processes. This means that you can easily check from a smartphone any invoice that your team may have questions about. There are some invoice management solutions that you can find online. Searching for “invoice OCR GitHub” will bring up a variety of different programs designed to use OCR technology on invoices. You may even find an OCR invoice processing open source solution like Tesseract.
Tesseract is an OCR engine that you can use with Python and other programming languages to build your own OCR program for invoices. However, you will need to find a method or software to connect an interface to it if you want to be able to use it easily. Furthermore, Tesseract is limited in its functionality. Its accuracy can suffer when it scans a font or format that it doesn’t recognize. Often, it’s better to go with an enterprise solution that has already been trusted by a variety of clients in a variety of industries.
Best OCR for invoice processing
The best OCR online platform does more than just capture data. It should also include an API that makes it easy to integrate the platform with the accounting or ERP system. Furthermore, truly taking control of your documents requires more than just optical character recognition. Although OCR does form a central element of the process, Intelligent Document Processing (IDP) is the full, comprehensive solution. An IDP platform streamlines the entire document workflow allowing you to easily import, process, validate, and post-process any number of documents quickly.
The best OCR for invoice processing goes beyond just scanning documents for characters and enables you to fully automate a variety of business processes. Whether you go with an invoice OCR open source solution or a paid solution, ease of use is vital. There is no value in a program or application that nobody wants to use because it is too complex. Rossum is an invoice classification machine learning program that uses OCR as part of a complete IDP platform.
Rossum was built with uniquely powerful AI capabilities to rapidly and accurately extract data from a huge variety of documents, including invoices. Why continue to waste valuable time by relying on manual data entry or template-based OCR when you have access to a solution that is faster and more effective? With Rossum, you can eliminate tedious paperwork from the desks of your accounts payable team and enable your employees to transform AP from a cost center into a profit generator.
Benefits of Artificial Intelligence in invoice data capture
Advances in AI, specifically cognitive data capture, can bring document data extraction to a new level of efficiency and efficacy, freeing employees from repetitive low-level work and letting them instead concentrate on added-value activities. In this article, we discuss the key benefits of Artificial Intelligence in invoice data capture for the modern AP departments.