Taming the Invoice Jungle

Case Study: Automating and standardizing a mountain of invoices became a snap for Northeast Utilities once the company partnered up with solutions integrator AnyDoc.

They may not be quite as unique as snowflakes or fingerprints, but invoice layouts display a staggering amount of variety.

On one vendors invoice, the date may be shown on the top right side of the page. On others, it may appear on the left. The text "Invoice #" may appear on one document, while "Invoice No." may appear on the next.

In short, all the key elements of each vendors invoice—from the purchase number to the total amount due—may appear in different formats and places on the page.

If your company has more than 2 million customers and your accounts payable department deals with more than 700 paper invoices per day, and youre considering OCR (optical character recognition) to automate your accounts payable process and eliminate manual data entry, this lack of standardization can quickly cause problems.

However, if you take the proper invoice software, add a high-speed production scanner and an enthusiastic local integrator, a solution can start to take shape.

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If your experience mirrors that of Fortune 500 utilities provider Northeast Utilities, of Hartford, Conn., that solution can revolutionize form processing in your organization beyond initial expectations.

"We process approximately 2,500 invoices a week, and we have 21 days to get an invoice into our system so that the recipient still gets paid within 30 days," explained Louise Jacques, a systems analyst in NUs accounts payable department who has been with the company for 25 years.

NU decided to investigate OCR software in conjunction with a high-speed production scanner to eliminate data entry and automate invoice verification. NU also wanted to integrate any new technology with its existing accounts payable and document management system. An RFP (request for proposal) was issued, and the meetings began.

"For over a year, we held numerous meetings with different integrators and vendors to see which software would best fit our needs," Jacques said. Automated document and data capture company AnyDoc introduced Imaging Solutions, a local AnyDoc integrator, to Northeast Utilities at a "very early stage of the sales cycle," said Wynne Cerone, vice president of operations at Imaging Solutions. Based on the results, NU eventually selected AnyDoc and Imaging Solutions.

Established in 1994 in Wallingford, Conn., Imaging Solutions provides systems integration and custom software engineering for enterprise content management and BPA (business process automation) systems.

"AnyDoc configured the system to capture the data from Northeast Utilities sample invoices," Cerone said. "We worked hand-in-hand with AnyDoc during the installation and implementation of the system. The extensive system testing was mostly done by Imaging Solutions and Northeast Utilities."

Imaging Solutions designed a system using AnyDoc Invoice software and a high-speed production scanner. AnyDoc Invoice is designed to extract data from unstructured forms, automatically capturing and processing the data needed from invoices, from vendor ID numbers and invoice dates through purchase order numbers and payment terms. When the information has been captured, validated and verified, the images are automatically transferred to database, ERP (enterprise resource planning), document management and/or workflow systems.

A crucial element in this process is the scanner itself, so Imaging Solutions and NU worked together to find the best scanner and eventually chose Eastman Kodaks i840 production scanner, Cerone said.

This high-speed scanner provides bitonal and color scanning functionality at high resolution and full speed. The i840 uses ultrasonic technology so it can scan adhesive labels and across various levels of paper thickness. It also reduces presorting, re-scans, and post-image processing.

"In the old system, it took approximately one and a half days to prepare, sort and scan one days worth of mail. Now, three days of invoices can be scanned in a few hours. With a 1,000-sheet capacity and fast OCR read rates, the Kodak i840 is "huge for us," Jacques said.

When the invoices have been scanned, AnyDoc Invoice is used to capture important form data. That data is verified against entries in NUs accounts payable system, and the invoice can be approved automatically without manual review. For example, the purchase order number is compared with NUs vendor database to find out which vendor to associate with it.

For future invoices, the software can remember exactly where each vendor displays data—from invoice date to purchase order number—on its invoices. Images of the invoices are also passed to NUs document management system.

"This solution made a huge difference. Were actually getting the invoices done in two to three days now," Jacques said.

But it wasnt all smooth sailing. Jacques said she believes that her department stuck too firmly to the target date they had set for the system to go live.

"We had a goal to get the software set up by a certain date, and we went live the day after. So, in my opinion, we didnt test the software enough. There were still some internal settings within the OCR software that werent just right," Jacques said.

At this point, NUs decision to choose a local integrator proved crucial, as it was able to call on assistance from Imaging Solutions, which could have a person on-site quickly. Imaging Solutions Cerone worked closely on the project.

Imaging Solutions now oversees the NU system without much need of support from AnyDoc, but the closeness of its relationship with the vendor proved useful in the initial stages, as AnyDoc was able to send people to NUs facility to support the implementation.

Following the success of the accounts payable implementation, NU is considering using the same system in its tax and rebates departments and to handle company timesheets.

"I think we picked a good vendor. I think we picked an excellent integrator. They worked real hard with us to get everything just the way we wanted it, and the numbers show that it has been huge for us," Jacques said.

Emmet Cole is a freelance business writer. He can be reached at isiwork@hotmail.com.

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