Adding purchase order processing (POP) to your AP Automation strategy

Pegasus Software’s Stuart Anderson looks at how a converged approach to AP Automation and Purchase Order Processing is expediting cashflow and elevating productivity for organisations. 

Accounts Payable (AP) Automation is seeing a lot of attention currently, as software providers deliver new features and functionality, and AI influences capabilities and potential. 

Using Optical Character Recognition (OCR) and AI to recognise key information from invoices, patterns and match these appropriately, AP Automation expedites payment processing and instils best practice across a range of core accounting areas. The addition of Purchase Order Processing (POP) completes the process, aligning payments with invoices in the most efficient way for optimum speed and visibility. 

Eliminating the nine-day PO cycle 
Given that Purchase Orders can take up to nine days to process within large organisations, automation of this fundamental accounting process is a no brainer.

Delayed payments and ambiguity around their specific status can cause frustration and impact relationships with suppliers. In a world where efficiency is king, a slow or inconsistent approach to payments can impact reputation and even threaten core service provision.   

​Formed through a combination of key technologies to form an end-to-end process, AP Automation with Purchase Order Processing (POP) expedites cashflow. It does this through alleviating a number of challenges traditionally associated with payment processing, including:

Boosting efficiency 
AP has traditionally been a heavily manual process for good reason. One of the last bastions of the digital transformation of the office of the Chief Financial Officer (OCFO), it is complex. Invoices come through in different formats at different times, and matching this to an equally inconsistent, paper-based PO system is a recipe for a sluggish process. Using a combination of OCR and a data lake to sift and present invoices in a consistent format, AP Automation removes this complexity. 

Removing manual entries 
Going hand in hand with efficiency, a convoluted mis-matched approach to aligning payments to POs and expediting the processing of them, can result in losses. Assigning the wrong payment or subjecting suppliers to long waits beyond payment terms while errors are rectified won’t pass muster in 2025. Through having all documents in one place, reconciliation is easy.

Strengthening supplier relationships 
Through consolidating all data on a single, central platform, live statuses can be accessed at any point to update vendors and ensure prompt payment in accordance with terms. Removing ambiguity means that frustrations are reduced and stronger, more longer-term relationships formed. 

Supporting sustainability 
Through removing, or at the very least significantly reducing the reams of paper associated with traditional Accounts Payable processing, there are obvious environmental wins. It’s not unusual for is to see companies with numerous filing cabinets filled with paper, all of which can be eliminated through adopting a digital approach. In some cases, companies have been able to reduce overheads through the associated downshift in office space requirements. 

Instilling scale 
As organisations expand and grow, either organically or via acquisitions, manual processes can really buckle with the additional inevitable workloads.

Having centralised cash flow, data and financial reporting in one place means that adding new entities or additional customers/suppliers can be undertaken in a standardised way, using established process flows. 

A seamless approach Opera 3 SE’s AP Automation capabilities leverage Purchase Order Processing for a truly seamless approach to optimising cashflow, ringfencing supplier relationships and instilling best practice.

To find out more contact us today to see it in action.