Globalization and the shift in international trade patterns have significantly impacted modern-day logistics industry. But this scenario too has a flip side. Though, changing industry dynamics have presented ample opportunities, they have given their fair share of challenges too.
One such pain area which nags, most of the logistic companies, freight forwarders, trucking companies, shipping companies, warehouses, and many more who rank within the logistic landscape is invoice processing.
Unlike earlier days, modern-day logistic companies have to capture/generate massive amount of invoice data from multiple sources, be it from traditional paper forms or digital formats. This ‘data explosion’ has been giving a tough time to account managers, warehouse & logistics managers, business intelligence & automation managers and many more, as it demands lot of efforts and time to create a well-organized database containing all the invoice records. This eventually makes it difficult for them to focus on their core tasks and hence; often the financial operations suffer a setback.
Several logistic companies still apply traditional information management tools and practices, and often try to do it in-house, which at times results into complete chaos. In-house processing is not a viable option, if your enterprise has an inadequate infrastructure, skills-set and experience.
Chaotic and outdated invoice databases create huge fissures in the supply chain management, which apparently results into poor operational efficiency. Realizing the importance of organized and systematic invoice records, several logistics companies are outsourcing invoice processing tasks to expert data processing service providers who provide smart data solutions at a very affordable rates.
Other than cost-effectiveness, there are several other benefits that make outsourcing invoice processing a viable option:
- Irrespective of how an invoice enters your company, invoice data processing service providers extract important from information fields using OCR and ICR. These data values are further, validated according to pre-defined guidelines, leaving no room for any errors. These service providers are adept in ‘intelligent data entry’, which involves picking up and keying (varying) data values for common fields like name, contact details, geographical area and date format in an efficient manner. This mitigates the issues cropping up due to mixed-up entries or duplicate values.
- It is no secret that processed and structured invoice data enhances data visualization. Experienced and innovative business process management service provider will have the foresightedness to convert the information from invoices into easily consumable formats like tables, charts, analytic reports and much more to augment data visualization. Better data visualization, further, helps the account manager/CFO to analyze the monetary position of the company. They get easy access and can reconcile these details with account receivables and payables, to get a fair idea about finances stuck up in transit.
- In addition to this, processed invoice data makes it easy to identify redundant pieces of information and remove it, for that clean and updated invoice databases. This apparently makes it easy for the warehouse & logistics managers, logistics coordinators and other stakeholders, to notice any fraudulent activities instantaneously and keep a check on it.
- In-house invoice processing requires setting up an infrastructure and hiring specialized human resources. This eventually raises the overall cost of processing and administration, if compared to the cost incurred on outsourcing the activity. This perhaps provides a very strong reason for many logisticians to outsource invoice processing. With an infrastructure and skilled human resources already in place, logistics companies can manage to save up to 20%-30%.
Logistics CFOs rank outsourcing invoice processing as one of the most viable and cost-effective solution to cater to the “information explosion” and leverage the financial health of the organizations.