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Transforming Efficiency in Your Business: The Power of Digital Invoice Processing

While businesses of all sizes have adjusted their operations to navigate the challenges of the times, such as the widespread adoption of remote and hybrid working, small and medium-sized businesses (SMBs) stand out as experiencing a profound shift in their digital transformation strategies.

In contrast to their larger counterparts, SMBs face significant budget constraints. Consequently, when confronted with the imperative need for digitalisation such as what occurred during the pandemic, implementing digital initiatives in these businesses proved to be at times a challenge. Even as we approach the four- year mark since the first lockdown, SMBs continue to navigate the post-COVID landscape.

A lingering question persists among SMBs... where should I start my digitalisation efforts? For me, supporting businesses such as these every day, I believe a pivotal focus should be directed towards streamlining financial workflows, with particular attention to the often tedious task of managing incoming invoices.

In this article, let me take you through how the adoption of digital invoice processing is reshaping financial landscapes for SMBs, ushering in unparalleled efficiency and securing financial well-being, as well as give you some top tips on the steps you can take to optimise your own digitalisation journey and enhance your overall operational resilience.

One size doesn’t fit all

It’s important to remember that implementing any sort of digitisation project is not a one-size-fits-all endeavour. It involves a strategic, meticulously planned, step- by-step approach. While digitisation strategies may exist, I believe that gradual implementation in selected areas and departments is the best route to take to mitigate risks and costs.

Departments such as HR and accounting emerge as prime candidates for digitisation. The standardised nature of documents and processes in these areas, coupled with the sensitivity of the information involved, makes them ideal for implementing digitisation with manageable effort. SMBs stand to benefit from reduced workload, enhanced efficiency, improved data security, and compliance with regulations such as GDPR.

Taking the first step

For SMBs with budget constraints, effective digitisation on a limited budget becomes crucial. So, where can you start?

I see that the advantages of digitisation in accounting are clear, especially in the processing of incoming invoices. A digital archive ensures accessibility around the clock, improving information consistency. Manual data entry bottlenecks and the reliance on isolated solutions are replaced by automated processes, leading to a significant reduction in workload and enhanced accuracy.

Given the complexity of tasks in accounting, a step-by-step approach to digitisation is advisable. Accounts payable, particularly in processing incoming invoices, serve as a solid strategic starting point. The time saved in this area translates directly into cost savings for SMBs, making the investment in digitisation quickly amortisable. Additionally, a big bonus you’ll see affect the wider business is the success stories of individuals involved in the project contributing to fostering an acceptance of new technology and dispelling any potential reservations within the workforce.

To retire manual processes, the first step I recommend is to digitise the mail, automating the receipt of invoices. The likes of scanners and intelligent computer software eliminate the need for manual data entry, converting paper invoices into digital documents. The automation of standard processes further streamlines the reconciliation between orders and delivered goods and services, ensuring faster approval through digital workflows.

And, the benefits don’t stop there. Digital invoice processing incorporates built- in error checks and automatic reconciliations, preventing payment errors and identifying potential issues like overpayments or duplicate invoices. Automation accelerates the invoice approval process, reducing the margin for human error and ensuring payments are made on time. Also, preconfigured workflows and forms simplify the implementation of digitisation, providing proven best practices for efficient invoice receipt processing.

Additional considerations for your SMB

Before you take that first step on your digitalisation journey, there are a few considerations. Firstly, you need to choose between cloud and on-premises solutions for digital invoice processing. What you go with completely depends on your specific business needs. Both options should offer almost identical functionality, allowing for a smooth transition between operating models – so do your research into which works best for you as both have pros and cons. Regardless, automation ensures a smoother workflow, fewer accounting challenges, and an overall more competitive company for your SMB.

And, digitising invoices requires careful consideration of data protection and legal requirements. Compliance with UK regulations, such as HMRC’s record-keeping guidelines, is of course essential. The good news is that digitised invoice processing facilitates cooperation with tax authorities and auditors during audits, ensuring all legal requirements are met. One less thing for your team to worry about.

Start small, aim big

After successfully digitising invoice processing, SMBs can explore additional digitisation projects, such as extending digitisation to the HR department. But remember, prioritising projects based on business needs ensures a coherent and effective enterprise-wide digitisation strategy, preventing technology incompatibilities, process design friction and workforce reservations.

As SMBs in the UK embrace the digital wave post-pandemic, digital invoice processing emerges as a transformative force in driving efficiency and financial health. By adopting a strategic, step-by-step approach and prioritising key areas for digitisation, SMBs can unlock the full potential of digital transformation and position themselves as modern workplaces, contributing to growth and innovation for years to come.

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