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Invoices and similar documents like purchase orders represent the lion’s share of most sales-driven businesses’ data workload. As a result, business leaders are always looking for ways to expedite or automate parts of the invoice data capture process. While very limited tools have been able to assist with processes like pulling already-entered data from one database to another or integrating apps into an existing database, AI and machine learning have broadened the scope of data capture tools.
AI invoice data capture solutions enable businesses to automate the extraction and organization of data from scanned documents of all types completely, with invoices and purchase orders being the most common document types automated through these tools. The two major methods for deploying these software solutions are:
- Purchasing third-party software for your staff to operate
- Outsourcing to an AI invoice data capture service provider
Let’s examine both of these options, their pros and cons, and their common use cases to determine which is the most valuable option for businesses looking to automate invoice data capture.
Purchasing Third-Party AI Invoice Data Capture Software
One common way to automate invoice processing is to purchase a license for third-party AI software for your in-house data staff to use. This reduces your existing staff’s workload, allowing them to simply input scanned documents into the AI software and allow it to automatically capture the data within.
Depending on the software tool, this automation may also automatically store this data into an integrated database, potentially offering integrations with your business’s current software stack to ensure that this database is interconnected with other tools your company uses for processes that rely on this data like backend finance, inventory management, and others.
To clarify how these tools accomplish this, let’s break down what technologies these tools use for invoice data capture:
| Optical Character Recognition (OCR) | Enables software to recognize and store/output alphanumeric characters, both typed and handwritten, with exceptional accuracy. |
| Artificial Intelligence (AI) and Machine Learning (ML) | Allows OCR-enabled software to perform basic functions with the information provided, like storing/organizing invoice data within a database and using the context provided by similar documents to learn where to find specific data points consistently. |
These technologies can also help with other types of document data processing, including purchase/sales orders, accounts payable/receivable, and many more. The above-listed functions are simply those that are directly relevant to invoice processing.
Pros and Cons
Software tools alone can certainly improve workflows by reducing overall workloads and streamlining invoice data processes like data entry. This makes invoice processing easier, faster, and more accurate. Purchasing third-party software still requires an in-house data team, though, so businesses that don’t already have one or are looking to scale their business without hiring more staff may not have all of their needs met by simply onboarding a new tool.
Speaking of onboarding, new tools mean training your data team to operate cutting-edge AI software properly and deploying it within your current IT network, which usually takes a few months minimum to get everything squared away.
Pros and Cons of Invoice Data Capture Software
| Pros | Cons |
|---|---|
| ✔ Better data accuracy | ✘ Still requires in-house data staff |
| ✔ Faster data extraction | ✘ Complicated onboarding and staff training |
| ✔ Lower labor costs | ✘ Higher potential for mistakes early on |
These pros and cons make purchasing software more valuable for small-to-mid-size firms with existing data staff. The onboarding process takes less time and requires fewer staff members to be trained for companies of this size profile, and the volume of inventory and funds is a bit more friendly to the small mistakes that are bound to happen when staff are using technology that is completely novel to them.
Outsourcing to an AI Invoice Data Capture Service Provider
A more comprehensive method of using AI for invoice processing is outsourcing the process to a third-party expert who can leverage AI for invoice data capture. These service providers often provide their own AI software solutions, and have used it to serve various clients across multiple industries. This means their staff are prepared to meet the needs of your business regardless of your industry, with a far shorter onboarding process.
As long as you choose a service provider with extensive experience, they are usually capable of complying with any regulations or data best practices relevant to your industry and often come with their own unique knowledge and additional tech tools to improve data reliability and security.
Pros and Cons
High-quality invoice data processing service providers make the process as simple as sending in your scanned invoices and allowing the service provider to return the information after they’ve captured and organized it in their database. Thanks to the cutting-edge tech they use and their comprehensive experience using it, this can be done incredibly quickly, and the accuracy and reliability of the data are vastly improved as well.
Outsourcing provides all of the positives of purchasing a license to use AI software in-house while mitigating almost all of the drawbacks by providing the labor force and experience necessary to handle high-volume invoice data capture.
Pros and Cons of Invoice Data Outsourcing
| Pros | Cons |
|---|---|
| ✔ All the same benefits of software alone | ✘ Choosing the right partner can be difficult |
| ✔ No need for an in-house data team | |
| ✔ Fully transparent and auditable |
These pros and cons make outsourcing the best option for midsize-to-enterprise businesses, especially those looking to continue growing. By eliminating the extensive onboarding process and handling all of the staffing, outsourcing partners allow businesses to scale their operations as much as they want without hiring additional staff.
A bonus advantage of data capture service providers for larger businesses is that they usually offer data capture for more document types than just invoices, meaning that they can add value to multiple departments at once. Larger companies clearly benefit disproportionately from more comprehensive services, since the sheer volume and variety of data processes are larger and require more time and money to handle in-house.
The only step left is choosing a data outsourcing partner that offers everything your company needs.
Choosing the Right Partner
Data-driven businesses deal with higher volumes of documents, funds, and staff information that require a high standard of accuracy and security. As a result, they should seek out an invoice data capture partner that:
- Offers the most advanced AI and machine learning-enabled technology
- Provides support that aligns with their working hours regardless of where they operate
- Stores data in an easily auditable database with transparent operation
- Prioritizes data security
- Has experience working with enterprise-level businesses across multiple industries
iTech data offers all of these helpful features and more.
Streamline Invoice Data Capture with iTech’s AI Data Services
We at iTech pride ourselves on our cutting-edge machine learning OCR software, top-of-the-line onboarding experience, and ongoing support. We also offer 24/7 access to support personnel and senior account managers to maximize visibility and peace of mind, eliminating the “black box” approach to outsourcing.
To learn more about AI invoice data capture, fill out the contact form below.
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IDS Commander iTech2021
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