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For a fresh look at campus invoicing, consider automation

by ​Ben Ruch
Budget cuts and challenging economic conditions have required higher education institutions to tighten their belts in recent years, as more universities1 have had their financial solvency questioned and been placed on a federal “heightened cash monitoring” list.

​Automation can help speed approvals and improve visibility into how money is being spent.

Meanwhile, cumbersome, costly paper-based systems can lead to universities incurring major costs, both in terms of the labor and resource costs2 associated with manual processes and late fees. At a time when, according to the National Association of Student Financial Aid Administrators (NASFAA)3, technological upgrades are the third-highest perceived resource need in higher education among administrators (coming in closely behind support staff — presumably to reduce current manual processes), many universities may want to consider automating these processes.

Automation can help speed approvals and improve visibility into how your money is being spent.
Woman on calculator with paperwork

The high cost of manual invoicing

Manual invoice processing is a story all too familiar at many universities. An invoice arrives by mail, is manually sorted and sent to the appropriate department via interoffice mail, where it’s opened and keyed into the your back-end system.

But that’s just the beginning.

After that, there’s still the approval process, the sending to accounts payable, the check writing and mailing, and, of course, further back-end notations and archiving of the whole thing. I’ve actually worked with universities where 80+ administrators touch every invoice.

Just think about how high that drives the cost of processing each invoice.
Man working on tablet with cost statistics

Let’s assume you receive 1,000 invoices per month. Based on my experience working with a variety of higher education institutions, I’ve found a university handling that many invoices manually can expect to spend roughly $48,000 on labor in a year, factoring in employee salary and benefits and the time-intensive, manual processes of opening up documents, keying information into back-end systems, reviewing and routing. That’s $4 per invoice.


That cost only scales up if you process more invoices (which many colleges and universities do), or enlist more staff. In my colleague B.J. McFarland’s recent post, "Three-Way Matching: Getting the Accuracy without the Effort," he discusses the lack of invoicing verification/matching. That leads to additional costs associated with overpaid invoices, which is not even factored into this per-invoice cost.

But it doesn’t have to be this way.


Enter: automation

Automating that process can reduce that time — and, by extension, cost — significantly.

When an invoice comes into the mail room, it is quickly and automatically scanned, its metadata is captured, and the document is sent electronically to the appropriate department for review. Once they’ve approved, they ship it (again, electronically) back to accounts payable, where a check is automatically generated.

This adjustment shaves hours — days, even — off the approval process. That drives down the labor hours – and dollars that go into invoice processing each month, as well as helping to avoid costly late fees. Additionally, when you capture an invoice directly into a review workflow at the same time as it is entered into your document management system, you can more easily search and evaluate invoices in the aggregate — gaining valuable operational insights and helping resolve claims about past invoices.

Get a fresher look at campus invoicing with workflow automation

Intelligently capture accounting data for your higher education organization, and streamline your AP processes with digital workflows.
Working with the right service partner can help a university accounts payable department overcome the inefficiencies associated with slow, manual processes and enable faster turnaround times and major cost savings. These partners can help you re-engineer the flow of invoices by quickly incorporating new technologies to intelligently capture, index and extract data for incorporation into digital workflows.

Learn more about optimizing and automating your AP/AR workflows here.
Ben Ruch
Ben Ruch, Senior Region Manager, Higher Education for Ricoh USA, Inc., works with colleges and universities to provide Professional Services, Managed Services and Business Process Outsourcing Solutions that simplify processes, automate paper-based workflow and improve speed of information. Ruch has over 23 years of experience in the industry and expertise in production printing systems solutions and professional services solutions.
1  Stratford, Michael. "Cash Monitoring List Unveiled." Inside Higher Ed. March 31, 2015. https://www.insidehighered.com.
2  McCart, Erin. "Improving Cash Flow and the Bottom Line with AP and AR Automation – Part 1." AIIM Community. January 8, 2015. http://community.aiim.org/.
3  "2015 Administrative Burden Survey." The National Association of Student Financial Aid Administrators. April, 2015. http://www.nasfaa.org/.