How AI can help with PO Invoice Processing?

Producing purchase orders are essential to any company. They provide an overall understanding of the assets a company is buying, playing a vital role in the company’s economic decisions. This helps a company strategize more optimized processes to ease out the acquiring cost of services and materials.

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Yet, there are certain challenges that are associated with purchase order invoice processing. This is for the same reason, we have written this article to give you a basic understanding about POs, the process associated, challenges, and how AI can help in easing all of it.

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Therefore, to learn more, read ahead…

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What is a Purchase Order (PO)?

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Purchase order is a common document primarily used for commercial transactions. It is an official document issued from a buyer to the seller. It carries important information along with it such as type of product, quantity of product, price of the product etc.

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The document itself doesn’t act as a contract but on the contrary acts as the acceptance of order from the seller’s side.

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Types of Purchase Orders

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There are several types of purchase orders. Those are:

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• Standard Purchase Order: A standard purchase order is utilized when the exact requirements are known to the organization. The best example of this would be procuring stationery for the company. 
• Planned Purchase Order: It is quite identical to standard purchase order. However, the relationship between the buyer and the seller is long-term, and from a single source. Its example would be a contract of one year of supplying stationery to the company from a single supplier.
• Blanket Purchase Order: It seems identical to the planned purchase order. However, the idea here is to have a contract between the buyer and the seller to provide the same product in a recurring cycle at a fixed price. 
• Contract Purchase Order: This one is identical to the planned purchase order and blanket purchase order. However, here only a contract is affixed between the buyer and the seller but not the item.

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Process of Purchase Order (PO) Invoice Processing in Companies

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There are several steps involved in the process before it comes to its completion. These steps are:

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• Generation of a purchase order from the company depending upon the requirement.
• Sending it to the supplier.
• Supplier sending the goods along with an invoice.
• Manually matching invoices to purchase orders for details such as type, quantity, price, etc.
• Sending it to the authority for final approval.
• Audit and archival of the data.
• Final payment to the supplier.

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Adding to it, there are several types of PO invoice matching that is carried out within an organization. These are:

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• 2 Way Matching: In a 2 way matching process, an invoice provided by a third-party is matched with the purchase order.
• 3 Way Matching: In the 3 way invoice matching process, the data from the invoice is matched with three different documents i.e. purchase order, supplier’s invoice, and receipt of the product.
• 4 Way Matching: A 4 way matching process is identical to 3 way matching. However, the additional component that is matched is the inspection information after which the data is uploaded to the database.

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Need of AI for PO Invoice Processing

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There are multiple reasons why an AI based automation solution is required for PO Invoice processing. These are:

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• High volumes of unstructured documents.
• Multiple manual checks that add more time to the process.
• Multiple requests for invoice processing at the same time.
• Additional operational cost spent on manual invoice processing.
• Mishandling of the data because of manual processing.
• Higher chances of fraudulent activities because of long, opaque, and complex processes.
• Less time for exception handling.

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Automated PO Invoice Processing using AI-based IDP

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An OCR has been a largely accepted way for decades as a digital solution for document data extraction. However, the needs of today have changed.

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Organizations of today require a solution that can process huge volumes of unstructured data, is scalable, and handles data efficiently without any errors. IDP (Intelligent Document Processing) is capable of that and a lot more.

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What is Intelligent Document Processing?

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IDPs are AI-based document automation platforms that are capable of data extraction, verification, and storage. They provide an end-to-end solution for multiple document processing use cases and are proven to reduce TAT & improve throughput. 

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IDPs are a collaboration of multiple technologies such as machine learning, deep learning, natural language processing, computer vision, and robotic process automation. These technologies provide IDPs their capability to process documents intuitively and cognitively. There are multiple types of IDP vendors available in the market. However, the type of solutions they provide can be classified into two categories i.e. Customizable and Specific to a use case.

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VisionERA - As an AI-based PO Invoice Processing Platform

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VisionERA is a SaaS-based IDP platform capable of providing end-to-end document processing experience for multiple use cases. It is an industry and use case agnostic solution because of its custom DIY workflow that can be changed and updated by its user without any coding experience. It also lets the user select the type of documents they want to use for a particular use case and provides document processing capabilities such as data extraction, data validation, triangulation logic, and storage.

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With VisionERA, it is possible to create an automated document processing environment because it is compatible with multiple downstream applications. Applications such as CRM, CMS, ECM, EHR, ERP, legacy infrastructure, emails, etc. It runs using a continuous feedback mechanism that lets you handle even an exception overtime. The user just has to provide relevant feedback and VisionERA would replicate the same in coming future cases.

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VisionERA Automating PO Invoice Processing

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There are a series of steps where VisionERA can be of utmost help. These are:

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• Once a purchase order is generated, VisionERA can extract all the important information and store it into the database.
• After receiving the goods and invoice from the supplier, VisionERA can automatically validate the data by matching the PO and invoice. It will also raise a flag whenever an exception occurs.
• VisionERA can be connected directly to the mailing system letting it send the email for PO approval to the approving authorities automatically.
• VisionERA comes with a collaboration window for different employees based on their hierarchy in the company providing processing insights.
• The matched and extracted data can be stored locally or into a cloud-based central repository.
• VisionERA is a SaaS based solution, therefore, it can be accessed from anywhere & anytime in the world.

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Benefits of Using VisionERA as an Automated PO Invoice Processing Platform

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There are several benefits of using VisionERA for this particular use case.

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• Higher Productivity
• Efficient and Effective Processing Capabilities
• Reduced TAT
• Higher Throughput
• Reduced Operational Cost
• Reduced per Invoice Processing Cost
• Higher Transparency
• Customization Capabilities
• Higher Security of Data
• Remote Accessibility
• Flexibility and Scalability

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Note: Currently, we are offering VisionERA at $0 invoicing till it produces FTE outcomes. It means you can procure VisionERA at no cost and pay when it starts to deliver results.

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Want to learn more about VisionERA and see how it can help with PO invoice processing? Simply schedule a demo with us at your convenience by using the CTA below or clicking here.