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Written by Jo Sutton, Head of Operations, Xledger UK
Xledger recently published an eBook on the subject of digital transformation. It is something that is at the heart of what we are doing with our software and so has a very real meaning for our customers in the UK. But there is also a potential to go further – as we see from the experience of our colleagues in Scandinavia.
Digital transformation is an increasingly-used term across all sectors. It sounds exciting, contemporary and full of promise in its ability to bring real change through technology.
Processing supplier invoices is an obvious area where organisations spend time and resources on an administrative task that is repetitive, not very exciting and does not contribute to the bottom line. Worse, it is prone to errors and open to fraud.
You can miss-key amounts, be fooled into paying fake invoices, be charged interest for late payments when invoices go missing. And then you have to store the source documents in a filing cabinet somewhere in case someone queries them or can’t understand why their budget has been charged for something they don’t recognise.
For users of Xledger this is a thing of the past. Automation means not only going paperless, it takes many of the labour intensive tasks out of the finance function.
Suppliers can email their invoices directly into the system. Sophisticated optical character recognition (OCR) technology reads the invoice and automatically enters the invoice details.
Artificial intelligence (AI) is used to propose the most likely GL coding and workflow routes the invoice to the most appropriate person or people for checking and approval.
The image of the invoice is stored within the application and can be viewed at any time for all time. Minimal clicks, minimal errors, built in checks and balances.
This frees up a lot of time for customers to do more strategic tasks such as use real-time reporting for analysis, empowering their organisations to grow.
But computers can do better than this. OCR is still processing an image. Suppose the invoice could be sent as data? Then there would be no room for error.
In 2012 the European Union developed a standard system for exchanging invoice data between companies, based on an agreed XML schema. It is mandatory in both Norway and Sweden for invoicing public sector organisations and so is fully supported by Xledger.
This is true digital transformation – completely accurate, reliable and secure entry and coding of invoices. Perhaps one day this standard will be accepted in the UK.
I should say however that such an option has in fact been available for over 30 years, using Electronic Data Interchange (EDI).
But this is a proprietary, cumbersome and expensive technology and has only really been adopted by very large organisations, such as major retailers. Not really the spirit of digital transformation as we expect today.
What Xledger does have today is more than getting paper off your desk. While going paperless is one of the side effects of the new finance system, the main benefits are of automation, insight and scalability.
Xledger is the most automated ERP on the market. If you have any questions regarding digital transformation, don’t hesitate to get in touch by email or by ringing 0117 329 1050.