As part of the accounts payable department, invoice processing plays a central role in your organization. In 2023, it will be more critical than ever to quickly gain the correct insights and automate this process. An effective method for invoice processing automation is called Intelligent Document Processing (IDP), and it also ranks #1 in the most commonly implemented IDP use cases.
Nevertheless, you may be unclear about certain aspects of the technology. So it’s about time to clarify your questions about invoice processing with Intelligent Document Processing – and also to debunk some of the claims made about the system.
Can Intelligent Document Processing really handle data in any type of invoice? We answer this and other questions in this Q&A.
Definition of Intelligent Document Processing
Intelligent Document Processing (IDP) is a system that uses advanced technologies to capture data and automate processes. These include artificial intelligence (AI) technologies such as machine learning, deep learning, natural language processing and computer vision. IDP is therefore sometimes called AI-OCR (Optical Character Recognition powered by Artificial Intelligence).
In your enterprise, you most likely receive invoices from many different suppliers and thus in a variety of formats. Advanced IDP is able to automatically find and extract the relevant data in them. Regardless of the layout of the invoices.
Unlike traditional OCR software, AI based accounts payable software or IDP requires no templates, hardly any configuration, and thus offers significantly more flexibility. In addition, the system is able to learn on the basis of data and thus continuously improve itself.
IDP can be used to automate any document, but today our focus is on invoices.
Q&A: Intelligent Document Processing for Invoice Processing
Does IDP increase the efficiency and accuracy of automated incoming invoice processing (while reducing the risk of errors)?
True: IDP systems can automatically extract all relevant information from invoices. For example, invoice totals, due dates, and vendor information. But also detailed line items in an optician’s invoice, such as the name of the eyeglass frame. This eliminates manual data entry and significantly reduces the risk of errors.
Can IDP also process handwritten data in invoices?
True: Depending on the advancement of the IDP system, handwritten data can be read from invoices. These solutions provide high quality results and therefore more efficient straight-through processing. Further details on IDP’s capabilities for handwritten data extraction can be found here.
Does IDP really reduce the cost of invoice processing?
True: Absolutely. With IDP’s invoice automation, you say goodbye to the tedious and expensive process of creating templates. This reduces costs, as do the efficient processes that are suddenly a reality.
Can IDP improve data organization?
True: IDP systems can automatically organize the extracted data in a structured format, like a spreadsheet or database. This makes it easier for your employees to track and analyze invoice data.
Is IDP the most effective solution for invoice processing?
True: With IDP, your company can process invoices much faster than if your employees did it manually. Your accounts payable department processes invoices more efficiently and pays vendors faster. As a result, you benefit from adherence to payment deadlines and, depending on the contract, cash discounts. At the same time, you also improve your supplier relationships.
Does IDP help with compliance and for auditing?
True: Invoices that are missing required information or those that have errors are automatically flagged by the IDP solution. This helps your company with regulatory compliance. In addition, many IDP systems have built-in audit capabilities that allow you to track changes to invoices. This creates an additional level of control.
Can IDP really handle unstructured data in invoices?
True: One of the key features of powerful IDP solutions is that they can handle not only structured and semi-structured data, but completely unstructured data. At the end of the day, it’s often the invoices with unstructured data that you want to automate.
Is IDP easy to scale?
True: Without an automation solution, and to cope with the continued increase in invoice volumes, you need additional staff. With IDP, on the other hand, which is virtually always running in the cloud these days, you scale infinitely. So you can keep up with any demand.
Is a 100% elimination of manual data entry really possible with IDP?
True: Depending on the IDP solution on the market, this is true. This is certainly the case with Parashift: With Upload-and-Forget, Parashift’s BPO partners also handle the post-processing of the extracted data for you. This allows you to consume fully validated document data via a single API and streamline the invoice automation solution.
Does the system continuously improve?
True: The unique approach of Document Swarm Learning ensures that the IDP solution has the highest recognition rates for completely unknown invoices with completely different layouts. This approach enables global AI training across all customers and across billions of data points without sharing the actual data. More training data generates continuously improved invoice processing OCR.
(False) claims about IDP
Manual processing of invoices is less effective than with IDP, but it is cheaper.
Wrong: Manual data entry is not only less effective, but also more expensive since you use your highly skilled employees for it. Moreover, slow invoice processing delays entire processes. IDP eliminates that. Plus, with the technology, you don’t have to worry about hidden fees or pay for annual maintenance costs. Operating costs are always transparent.
If invoice data is incorrect, IDP becomes an obstacle.
Wrong: If the AI is not sure that it has captured the correct information from the invoices, it resorts to the Human in the Loop for verification. Thus, for best extraction results, AI-based data extraction technology is combined with human validators (Human in the Loop).
Operating an IDP platform is complex.
Wrong: Modern systems are often built according to the no-code principle. This means that the platform is created in such a way that even business professionals without IT knowledge can use it. If you have invoices where you want to configure individual fields, you do it with a few clicks.
IDP can only be used for the use case of invoices.
Wrong: Parashift’s IDP platform is designed for all documents in all processes. Either directly through the numerous standard document types available or as custom document types.
Integrate State of the Art Intelligent Document Processing
Are you tired of using your highly skilled employees to process incoming invoices? Integrate Intelligent Document Processing into your existing system landscape and automate with the world’s most accurate and versatile Invoice OCR API.
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