How to automatically extract data from invoices?
“Use an invoice data extraction software!”- this is a common, yet vague answer many industry leaders often get. However, the mystery behind which is the right software remains unsolved.
Consequently, business owners end up either wasting a massive amount of money on irrelevant software or simply stay confused forever.
Hence, we have come up with an easy checklist for you to select the right invoice extraction software.
Irrespective of the type of software you employ in your company, it’s the ease of use that makes it worth using. If it takes you a fortune to understand the software and then train your staff to start working with it, it loses its essence. Hence, look for a data extraction software that is quick to set up and implement, and require minimal effort in helping your staff master it.
You are looking for an invoice extraction software primarily for automating mundane tasks and freeing up your resources to be invested in other crucial AP activities. Hence, the software must offload as many tasks as possible. Judge the software based on its automation capabilities and aspects of it that don’t require human verification. The more tasks the software could automate, the more resources it will free up for other duties.
Don’t fall into a trap of free invoice processing software that provides a substandard solution in the name of automation. Instead of freeing up your AP team of repetitive tasks, you will end up adding more to their list, while also losing revenue and business reputation. Therefore, check the data accuracy rates of the software you are shortlisting. The extracted data should help you reach 90-95% accuracy in a short time span.
Your company’s privacy policies should not stop you from leveraging automated invoice processing. However, the invoicing software shouldn’t violate the policies, either. Make sure the software you choose respects your company’s data privacy policies and provide you with solutions that align with those policies. Instead of violation, the software should do its tasks without interfering with the policies.
A reliable and efficient data extraction software can handle all types of document layouts to extract and process data. Similarly, the invoice software should be able to extract data from free-form invoices and expense reports, irrespective of their layout/structure/format. Moreover, the structure of extracted data should be the same across all the invoices. An invoice software is ideal if it can solve the real problem – structuring and processing data in a meaningful manner.
An invoice data extraction software must be able to give clear reports, based on the extracted invoice data. The software must enable you to draw patterns while analyzing the data and determine trends. It should alert you of any duplicate payments, frauds, or other such practices. At the same time, it should also present meaningful reports regarding your company’s sales, revenue, vendor benefits, and its overall performance in the market.
Check if the software can go a step ahead in solving your data processing challenges. There are certain rules and regulations to be followed while processing invoices. It can be country-specific taxes, discounts, VAT compliances, etc. that the software should adhere to while extracting data from the invoices. Such features make the invoice software a preferred choice over other options. Hence, ask your service provider of all the advance invoice processing options your company can avail of with the software.
The primary reason why template-based invoice data extraction software is not among preferred options is it keeps the AP team busy in designing new templates for every invoice layout that comes its way. Hence, look for a software that trains itself with every new document it scans for processing. Analyze how the software adapts itself to new invoices and extracts accurate data from them. Check if it can work with all types of free-form invoices and expense reports with best possible efficiency.
If the software requires additional resources in terms of set up, integration, or during implementation, it’s a big no-no. Look for a solution that integrates seamlessly with your company’s systems without additional software support. Cloud solutions are the perfect choice when it comes to employing software for your internal business units. They do not require extra storage space or resources to work.
The IDP software should have out of the box integrations with the software you use. Or it should have ready to use APIs so that you can build the integration. This integration should help you automate the data reconciliation with various exiting data sources within your organization. Using this reconciliation, you should be able to create a Straight Through Processing (STP) pipeline. All the documents that pass the reconciliation rules, can go straight through. Your teams should only be reviewing the exception queue which will have documents that did not pass any one or many reconciliation rules. The review of exception queue should be very easy and fast. Most importantly any review or correction feedback should automatically be used by the software to train itself and refine it’s predictions/ data extraction on an ongoing basis. This will help continuous improvement of accuracy.
KlearStack checks all the pointers in this list. Yes, KlearStack is a comprehensive solution that has all the qualities of a reliable, productive, and efficient invoice data extraction software. It is a template-less, end-to-end automated, and document decision support integrated software, designed to enhance organizations’ internal business operations.
If you are willing to know more about how KlearStack is the right choice for a full-fledged invoice extraction software, book a free consultation call with us today.