Conduct an internet search of artificial intelligence (AI) and you’ll find a plethora of articles describing what it is and how it’s transforming every part of our lives. From cybersecurity, medical treatments and weather forecasting to predictive purchasing, music composition and social media, AI is integrated into everyday life, even when we don’t realize it.
But what exactly is AI? Made up of machines and computer programs, AI learns to perform tasks that historically required human intelligence.
When discussing AI in the transportation industry, many people think of advances such as autonomous vehicles, predictive analytics for fleet safety, automatic load matching and route optimization. These developments are certainly noteworthy, having increased safety, productivity and decreased costs.
AI is also transforming organizations’ administrative areas, such as the accounts payable (AP) process. The solutions have been available for some time now, but many organizations still rely on manual procedures because they don’t have confidence new solutions will perform as accurately.
“Traditional processes may have produced satisfactory results for decades, but they’re not enough in today’s fast-moving business climate,” said Larry Kerr, president and CEO of Illinois-based EBE Technologies, provider of automated workflow solutions for the transportation and logistics industry in North America and Canada. “Ignoring ways to optimize work processes may be the death knell for some companies as they struggle to keep up with competition who have embraced more innovative ways.”
For carriers ready for new ways of working, the benefits are abundant when AI is integrated among the AP workflow, procurement system and the accounts receivable process. Let’s start by looking at how AI can improve the AP process in transportation organizations.
AP workflow: Taking mistakes out the equation
Purchases are usually made through invoices and many are still paper ones. It shouldn’t be surprising that it’s more costly and time consuming to process paper invoices compared to automating the task. Spending-per-invoice data analyzed from the benchmarking database at The American Productivity & Quality Center revealed that those industries that have embraced electronic invoice processing had lower cost per invoice (average $2.07) over those that managed paper ones (average $10).
Why the disparity in costs? First, paper invoices require manual data entry, which are prone to errors. Complex approval procedures and data inconsistencies can delay the process – which means losing out on early-payment discounts and being penalized with late payment fees.
Nu-Way Transportation, a dedicated logistics provider with 500 employees, experienced the above pain points with its own manual accounts payable system. The Bloomington, Illinois-based company operates 325 power units out of 50 terminals throughout the U.S. Its accounts payable department was busy but inefficient, hand-delivering, faxing or emailing more than 500 invoices from its corporate office and off-site locations. Errors frequently occurred because of inconsistent invoice formats and a lack of an invoice tracking.
Chris Grzincic, vice president of information technology for Nu-Way Transportation, turned to EBE Technologies to improve the department’s productivity and efficiency. He called EBE’s AI-supported accounts payable and purchase order (PO) manager solutions a “one-stop shop that provides all pertinent information,” meeting all of Nu-Way’s expectations.
Nu-Way implemented EBE’s paperless system across all terminal locations. This AI-based solution allows Nu-Way’s accounts payable staff to manage only the out-of-standard invoices. By automating the process, the company saw invoices processed more quickly and with fewer errors.
“The accounts payable and PO manager solutions take all the guesswork out of the invoicing process,” Grzincic said.
Procurement: When you hesitate, you lose
Increasing organizational efficiency is a shared goal among most companies today, and AI can be a tool used to acquire it. Processes supported by AI can streamline tasks, such as invoicing, recordkeeping and data entry, which are subject to errors, bottlenecks and delays. Automating these high-volume, time-consuming and repetitive tasks frees your staff to concentrate on making more strategic decisions not suited for AI.
“We’re not eliminating the need for humans,” explains Kerr. “Humans are still the best at maintaining relationships with customers, vendors and other stakeholders.”
Perhaps you want to maximize — automatically — your company’s contract data so every purchase made is from the correct vendor at the right terms and price. This was important to Nu-Way as inefficiencies in its procurement process often caused the company to overpay for parts or double bill for repairs. With EBE’s AI-supported processes, Nu-Way gained visibility into best-priced parts when purchasing from vendors. The solution also gave the company specific workflow queues for vendor invoices, so double billing was no longer an issue.
Let’s not overlook the importance of AI and real-time monitoring of key performance indicators (KPIs) and compliance data and market-related risk. Automated processes are faster and more accurate than humans for analyzing large amounts of data for procurement contract management. Nu-Way discovered this with EBE’s solution as its KPIs are more easily monitored, enabling staff to make data-driven decisions.
Grzincic said automating the accounts payable process is an excellent way to increase productivity. “Whether it’s our dispatch department, our managers or our fleet department, our personnel can go into EBE’s solution and all the information is right there in one system at a click of a button.”
Accounts receivable: Versatile multitasker
In the accounts receivable process, a common task conducted by back-office staff is reconciling information on the billing document with data in the dispatch system. If a discrepancy exists — perhaps a status was missing (e.g., dispatch, driver, equipment) — processing that transaction is halted until someone can research the issue. This activity is repeated by other accounts receivable staff working on other billing documents until the process consumes most of their time.
Using an AI solution in accounts receivable can better aggregate, compare and correct data, if possible. If it detects a failure in validation of the data (e.g., an OS&D claim), the status can be changed to process the transaction as in-standard. Alternatively, it could place the transaction in a workflow for resolution. The key is that the AI solution becomes the primary biller and companies can staff their billing departments to process only the out-of-standard documents.
Adding a mobile capture application with an AI solution increases efficiency for everyone involved. Drivers can capture images of documents, data and photos, then send them in near real time to accounts receivable staff. That kicks off the AI workflow that processes documents automatically, billing the shipper and settling with the driver almost instantaneously.
“A creditable AI-supported mobile solution also features integrated indexing, which automatically validates data accuracy and eliminates manual data entry so your back-office staff can focus on other tasks,” Kerr said.
Integrate AI into your goals
AI is a trendy buzzword thrown about in science, business and social circles. But AI is more than a passing fad. AI can — and is — making transformational changes to the way we live and work. While we’re still learning the depths of its potential and limitations, we know how it can improve the accounts payable process in the transportation industry.
If reducing expenses, gaining efficiencies and increasing productivity are on the list of your 2021 business goals, take another look at AI workflows. A solid solution will integrate among your procurement process, AP workflow and back-office accounting system and free your staff to focus on strategic tasks that positively shape your business.