4 Ways Managing IT Invoices by Hand is Hurting Your Business
Let’s just address the elephant in the room… you’re still manually doing invoice management.
You know it’s inefficient. You know it’s laced with mistakes. You know that you’re paying an entire salary (or more) for the task of inputting and organizing. You know that you’re settling for the status quo because, well, you know–you’re just too busy to change.
This isn’t to shame you for not fixing this problem. Not at all, in fact. We understand that efficient invoice management is a lot of work, and if you currently have a process that gets it done–despite all of its setbacks–it can be a pretty scary thought to overhaul it, even to something better and (gasp!) automated.
It’s for this reason we created our vManager platform in the first place. Because we believe evolving your business into an automated invoicing workflow should not only be painless–but accessible to everyone. This is crucial because status quo, manual invoicing is both as costly as it is tedious.
So many stages of the IT spend lifecycle are exhaustive when done by hand, but when it comes to invoice workflow it can be especially daunting–and expensive. It’s estimated that the average cost to process a single invoice ranges from $12 to $30, and goes even as high as $40 for more complex invoices. Take a moment to personalize this for your business and multiply that cost by how many invoices you handle every month. The mounting cost of not automating your IT invoice workflow becomes clear.
Knowing this, we have to ask–is settling for the status quo worth it when it comes to your invoice management? If you think your business is suffering from the effects of invoicing by hand, let’s take a look at four specific ways manually managing IT invoices hurts business and see which ones you experience on a regular basis.
As a latter step in the IT spend lifecycle, the volume of work can snowball when it gets to the invoice stage, making human error more frequent. And when it comes to invoicing, it’s no surprise that mistakes not only result in time wasted and frustration, but potential loss in profit, too.
How much human error is occurring? Studies show 2-3% of all invoices done by hand encounter a mistake resulting in additional cost. You might think that number is low or the costs associated with it are negligible, but if your invoice workflow is done by hand, that means that 2-3% is multiplied across every invoice across the entire invoice process, making you susceptible to incurring losses from late fees, increased personnel, postage costs, lost discounts, duplicate payments, and a whole combination of potential charges and costs.
Manually processed invoices live as either proprietary spreadsheets that only a few people (or one) can access or as printed out paperwork. Neither of these formats are shareable or responsible. Homemade spreadsheets aren’t universally readable beyond the stakeholder, and paper is incredibly limited in its accessibility, especially across offices. The outcome of these physical limitations? Less understanding and transparency resulting in a lack of checks and balances leading to costly uninformed business decisions that act like leaky holes in an IT budget.
Untapped Staff Potential
There is a reason we call the staff we hire “talent.” They’re talented people! While organization is a talent, we need to be honest about where technology, automation, and cloud services are more efficient and accurate than any human hand. This isn’t something to be fearful of–rather, it’s an opportunity.
Wouldn’t you prefer to have someone innovating for your company rather than plugging numbers into a spreadsheet? Stop paying your staff to be a machine when you can have a machine do it. Instead, drastically reduce the time spent on invoicing by allowing an automated platform to do it infinitely better, faster, and more cost effectively and invest in people who can add to your bottom line with ingenuity, innovation, and creativity.
One of the top rules of invoicing is get paid often and fast. This works the other way around, too–it’s good to pay frequently and on time. For both parties, this is cost saving and less stressful on your budget.
More frequent payments means payments are broken up into lower amounts (good for the customer) and money is exchanged more often (good for the recipient). It also means each payment is usually lower, which avoids huge line items that stand out on a budget. Not to mention that many invoicers offer discounts when setting up automatic payments and other expedited ways to pay. And of course, there are late fees when payments don’t come in on time. For the recipient, chasing down late payments is a timely endeavor (aka-costly), so paying on time is better for everyone involved.
Now we’re not assuming that you don’t bill or pay invoices in this way–we’re sure you probably do; however, invoicing by hand is a slower process, so when invoices back up during a busy season, even a billing and accounts payable team with the best of intentions can fall behind. Extra time is spent addressing late payments, penalties rack up, and your profit margins narrow a little more each day.
Don’t Delay the Inevitable
Automation, SaaS products, and cloud services have never been more widely accessible across every size market. Big or small, companies can implement solutions that improve their invoice management, right now–and if you haven’t done it yet, you are getting dangerously close to being behind the curve or your competitors.
Like anything else, there are good and bad products available when it comes to invoice management, and the last thing you want is something difficult to adopt and creates more work. At vCom, we believe an invoice is the end of a larger story–one that begins with solution design and goes all the way through the IT journey. We built vManager to manage that entire IT lifecycle, so the invoice stage is more than just seamless: it’s planned for, insightful, and efficient.
All of which not only makes the invoice process more beneficial to your business, but makes the experience of working with you more enjoyable to customers and providers–and who doesn’t want that?