Today, only a small percentage of utility suppliers distribute invoices via EDI, and they aren’t readily joining P2P networks. In fact, for many companies, about 25 percent of total invoice volume is related to recurring utility bills — including electricity, gas, telecom, water and waste services. This can amount to over 5,000 utility bills each month for a medium-sized company that’s processing around 20,000 total invoices per month. Ongoing manual tasks related to utility bills hinders straight-through processing, results in higher costs, and limits the visibility of key metrics regarding consumption, costs and trends.
In Episode 7 of Esker On Air, host Scott Leahy talks with Dan Reeve, Director of Sales and Business Development at Esker, and Tim Porter, Director of Strategic Account Sales at Urjanet about the need to automate the notoriously manual processing of utility invoices. Urjanet is a data as a service (DaaS) utility data platform that delivers electronic invoices and invoice data from over 7,000 utilities worldwide, helping to provide an automated feed to the problematic niche of utility invoices that people need to access with the use of their software platform. Together, Dan and Tim share their collective expertise, experiences and advice about using software to automate utility invoice processing and collect valuable, actionable data.
Pre- and Post-Covid Trends in Utility Invoicing
The global pandemic has prompted many organisations to pivot and change the way they operate. If there’s any silver lining, it’s that the worldwide business disruption we’ve experienced has forced businesses to innovate and leverage technology to create new efficiencies ASAP. Organisations that were putting off digital transformation plans were suddenly forced to expedite automation initiatives in order to keep operations running remotely and profitable — while that was essential to do now, future business will benefit from these new efficiency-boosting enhancements as well.
Additionally, many companies were forced to really evaluate their processes and consider all areas that would benefit from automation — most learning that more of their business processes would greatly benefit from digitisation than they originally thought or planned.
Common Issues with Manual Invoice Processing
When it comes to manual invoice processing, the most obvious issue is speed … or lack thereof. Luckily, waiting for the mail man to deliver an invoice is an easy inefficiency to eliminate when invoicing is completely automated. According to IOFM, businesses that have achieved straight-through processing of utility invoices have seen 74 percent faster processing times. Not only that, but they also experience on average an 80-percent reduction in processing costs. With automation, you can save significant time and costs on materials/labor typically associated with manual invoicing.
Something else Covid has brought to light for organisations is the need to gain early visibility into spend and AP processes in order to make better business decisions as economic circumstances continue to change.
Benefits of Automating Utility Invoice Processing
The major benefits of using automation software to handle utility invoices is that it almost completely takes paper out of the process, which in itself opens the door to new improvements and efficiencies, including:
- Electronic workflows for routing and approvals
- Payment of invoices on your schedule
- Better visibility into spend and performance
- Elimination of late fees
Overall, the best way to treat the top pain points of processing utility invoices is to get rid of paper and fully automate both the collection of invoices and the data extraction of those invoices. Even though this group of invoices has managed to hide in the shadows and avoid automation for a long time, now is the time for organisations to modernise the processing of utility invoices to benefit businesses now and in the future.