AP Automation & Intelligent OCR – A Winning Combination

I’m sure you’re wondering…how can AP automation save me time and money?!

Let’s say Company A processes 500 invoices per month. A manual invoice costs $15.38 to process, while an invoice processed using AP automation averages $2.87 per invoice (commonly cited statistics in the AP industry).

Here’s the math:

That’s almost equal to the cost of 2 AP Clerk I’s in the US that make, on average, $43,025 (per

It’s well-known that labor is the primary cost in AP because of how manual your processes are. Think about how much time you spend looking for and sorting documents, keying and rekeying invoice data, fixing mistakes and errors, and then routing them for approval. AP automation can:

  • Reduce processing and approval times.
  • Eliminate paper storage.
  • Provide faster document retrieval.
  • Offer anytime, anywhere data access.

And OCR can play a big part in your AP automation, taking the cost of processing each invoice down to mere cents. OCR minimizes errors, providing greater accuracy and less exceptions that need to be researched and resolved. OCR can help you lower your high labor costs associated with processing invoices.

Traditional vs. Intelligent OCR

Traditional OCR has made significant inroads in helping companies eliminate manual keystrokes when processing invoices by converting scanned images of text into machine-readable text. It uses image processing algorithms to identify and extract text from images based on patterns and shapes.

However, with traditional OCR extracting this data can be time-consuming and cumbersome to manage, as a template must be created for EVERY document being scanned. These templates enable the OCR to pull specific data from pre-identified areas on the document.  So, every time a new vendor is onboarded, a template must be created so that the OCR engine can extract the data you want from each invoice. And if vendors change the format of their invoices, then a new template needs to be created for OCR to work effectively. This can be costly since it can take programmers hours to set up a single template.

That’s where newer, more advanced versions of OCR take over. Intelligent OCR uses machine learning algorithms to improve recognition accuracy. It doesn’t rely on templates – with minimal human training, the AI engine quickly learns what information needs to be captured and where to look for it. Also, the system becomes smarter and more efficient the more it’s used. When a vendor changes its invoice format, intelligent OCR adapts quickly to learn that too.

Ultimately, intelligent OCR minimizes the time it takes to get the data you need into your AP automation system because it doesn’t rely on humans that can make manual input errors.

2- and 3-Way Matching

One of the greatest benefits of intelligent OCR is its ability to help automate the accounting matching process.

Whether you are 2-way matching (invoice/PO) or 3-way matching (invoice/PO/receipt), intelligent OCR automates and speeds up the data extraction process on data including:

  • Invoice number
  • Supplier name
  • Purchase order number
  • Item description
  • Quantity
  • Price

Successful matching in your AP automation system relies on dependable data to automate that process. Intelligent OCR helps ensure that the your AP automation system gets the most accurate and clean data possible, which makes for a smoother, touchless matching process.

Now the reality is that with matching, there’s always going to be discrepancies and exceptions that do require manual intervention such as item number discrepancies or inconsistencies in pricing or quantities for example. Resolving these invoice exceptions typically requires significant resources since it can be a time-consuming and labor-intensive process.

Using intelligent OCR can substantially reduce the number of exceptions that accounting personnel must manually correct/add. And by minimizing the number of errors that require manual intervention, you will save significant time by increasing the number of invoices that go straight through to approval.

Intelligent OCR Success

The proof is in the results. DocLink user Herman Goldner has experienced huge operational and financial efficiencies with this winning combination. With DocLink, most of their documents can go from vendor to approver without a touch –75-80% of their 80,000 incoming invoices per year being routed straight through to approvers!

If you’re looking to implement a document management solution, make sure your chosen solution offers intelligent OCR capabilities to ensure the highest levels of:

  • Efficiency – reduce human errors and inaccuracies
  • Productivity – recapture time to focus on more strategic tasks
  • Time savings – eliminate hours/days manually extracting data from documents

And if you’re interested in learning more about DocLink and Smart Capture OCR, reach out to us for a chat and a demo!