In the fast-paced automotive industry, managing the accounts payable process efficiently is crucial for maintaining financial stability and fostering strong supplier relationships. An electric vehicle manufacturer in the US handling over 10,000 invoices monthly, faced significant challenges in their accounts payable process due to the sheer amount of unstructured data across their organization. By partnering with Gradient, the manufacturer was able to automate their accounts payable process using Gradient 's data platform.
The electric vehicle manufacturer faced several primary challenges in their accounts payable process:
Manual Data Entry and Processing: The manual entry of invoice data was susceptible to errors, increasing the risk of inaccuracies in amounts, dates, and vendor information. This slow and labor-intensive process led to delays in payments.
Issues with Invoice Matching: The three-way matching process, which ensures that the purchase order, goods receipt, and invoice all match, was complex and time-consuming. Since the data across these areas are all unstructured, analyzing and interpreting the data can be challenging. Discrepancies often led to delays and disputes with vendors, complicating the accounts payable process.
Late Payments: Delays in the accounts payable process disrupted cash flow management and strained relationships with suppliers. Late payments not only affected the company financially, but it also risked incurring late payment penalties, further increasing operational costs.
The AI-Driven Solution
Gradient’s data platform was used to help transform the unstructured data within the accounts payable process, to support a more efficient way of cross reference and verify the information.
AI-Powered Data Extraction
Gradient simplified invoice processing by automating data extraction from their SAP ERP system and invoices - regardless of the format (e.g. PDFs) . This ensured accurate and timely financial reporting, helping the team avoid the tedious task of processing, analyzing, and interpreting vast amounts of unstructured data.
AI-Powered Invoice Matching
Gradient synthesized the purchase order, goods receipt, and invoice matching process by automatically aligning invoice items with the correct SAP entries. This significantly reduced discrepancies and the number of open invoices, ensuring a smooth procure-to-pay (P2P) cycle.
Reduced Invoice Errors
The solution accelerated processing times through automated validation, optimizing operations and reducing costs associated with manual error correction.
Enhanced Payment Management
Using historical trends, Gradient's AI-powered solution surfaced and prioritized critical invoices to avoid payment blocks. This enabled timely and consistent payments, fostering better supplier relationships.
The Impact
The deployment of Gradient's AI-powered solution had a profound impact on the electric vehicle manufacturer's accounts payable process, including:
Reduced Payment Errors: The automation of data extraction and validation significantly minimized human errors by 65%.
Reduction in Workload: Automation drastically cut down the manual effort required, freeing up resources for more strategic tasks and overall workload by 70-80%.
Faster Processing Times: The streamlined processes accelerated invoice handling, ensuring quicker payments by 70%.
Lower Processing Costs: The reduction in manual labor and errors led to substantial cost savings of roughly 60%.
