12/06/2014

By Christina Bowe, Regional Director, UKI, Perceptive Software

For many organisations, going paperless is a dream rather than a reality. Despite predictions of a ‘paperless office’ having been made publically since 1975, for many businesses this vision is still a long way from being realised.

Nowhere is this more apparent than in accounts payable departments. Almost three-quarters (71 per cent) of AP organisations state that over half of their invoices arrive in paper format.

Whilst finance professionals recognise the benefits that the paperless office can bring, - reduced admin, faster processes, better visibility, streamlined operations - they are unsure of where the journey begins.

Understanding your current position when it comes to automating processes and driving paper out from your organisation is a good place to start.

Working with The Institute of Financial Operations we’ve developed the Paperless Office Maturity Model (POMM). It’s designed to help finance professionals measure their progress towards the paperless office. To know where you want to go, you need to understand where you are today.

From our work together we’ve been able to identify five levels of maturity on the road to automation and a paperless office reality.

Level 1: Paper-Based
A high-cost, transaction-driven environment, which is totally based on paper. There is manual indexing, data capture and workflow, storage is typically in filing cabinets and enquiries tend to be handled in person by phone or email.

It’s a decentralised, disconnected environment.

Level 2: Image-Enabled
What we see here is paper-based invoice receipt combined with front or back-end imaging. There is manual or partial automatic indexing of content and document storage may be either electronic, physical or a combination of the two.

It’s the first step towards automation.

Level 3: Workflow-Driven
This is the jump to electronic invoicing. The operation is at least partially centralised with a move towards consolidation or shared services. Invoices are typically scanned at point of entry and data usually extracted automatically using Optical Character Recognition (OCR). Reporting and workflow processes are automated and indexing of content allows for easy access.

It’s becoming a centralised, connected environment.

Level 4: E-Enabled
The first signs of touchless processing are emerging with significant progress towards full automation. Paper-based receipt and processes have been replaced by imaging and intelligent data capture. There is selective use of electronic data interchange, e-invoicing, PO flip and supplier portals for self-service querying.

It’s a transformed operation, well on the way to full automation.

Level 5: Paper-Free
At last, paper-free nirvana.

All invoices are received, processed and paid electronically. There is close integration with core business systems, such as ERP and ECM, automated supplier onboarding and self-service portals.

Progression from Level 4 to 5 sees the organisation focused on continuous innovation. By using data from processes and suppliers at every level, it can develop and evolve its day-to-day operations.