Actually, the market did. As you have already seen in other articles (such as this one or this one), Ardent Partners recently completed a fairly robust study on the accounts payable process and the technologies that are improving the performance and efficiency of the process. Cost is and always was the biggest driver for modernizing the AP process and for the most part these costs still remain high. For the companies that participated in Ardent’s research effort, the average cost to process an invoice was just over $13. Comparatively, there are enterprises performing at a much higher level and at a fraction of the cost ($2-3 per invoice).
So, in an effort to better understand this, Ardent analystsdrilled down into the data to determine the impact that technology has on invoice processing costs. Ardent analyzed how the average cost per invoice changes as the percentage of electronic invoices received increases.
The results were quite revealing. When a company receives under 10% of its invoices electronically (this does not include invoices that go through imaging and OCR), there is no significant impact on the average cost. However, when the percentage of eInvoices received increases to between 10-30% there is a big drop in the average cost to process an invoice. This cost continues to drop as the percentage of eInvoices received goes up.
Why does this happen? Well, receiving more invoices electronically reduces the need for data entry or manual validation and matching, which is all done automatically with eInvoicing. There are bound to be fewer errors and discrepancies due to the business rules that can be put in place. Digital formats also enable straight-through processing, which makes the approval process more efficient and greatly increases the number of invoices processed per FTE, thereby reducing operational costs.
