Automated Invoice Processing System with OCR and Workflow Automation

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Solution Overview

Problem

Current manual or semi-manual invoice processing systems face challenges such as reliance on personnel knowledge for authorization, data re-keying, lack of audit trails, managing invoices of varying formats, decentralized approval processes, and cumbersome file transfer methods, leading to inefficiencies and difficulties in tracking invoice status.

Innovation Solution

A computer-implemented method and system for automated invoice processing that receives electronic images, assigns IDs, stores and transmits them, and facilitates approval workflows through queues and email notifications, allowing remote access and approval, with features like OCR for data extraction and centralized tracking.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Ease of operation

If manual or semi-manual processes are used for invoice processing, then personnel can make decisions based on their knowledge, but the process becomes time-consuming and labor-intensive

Engineering Contradiction:

Improvepersonnel decision-making capabilityVSAvoidinvoice processing speed

Core Design Contradiction:

Ease of operationVSProductivity

Solution Approach 1:

The system enables self-service through automated workflows where the invoice processing system automatically routes invoices to appropriate approvers based on pre-configured rules, performs OCR data extraction, and tracks approval status without requiring manual intervention at each step. This maintains personnel decision-making authority while eliminating repetitive manual tasks.

Inventive Principle:

Principle #25Self-service

Solution Approach 2:

The system performs preliminary actions by pre-configuring approval workflows, pre-extracting data through OCR, and pre-identifying appropriate approvers before the actual approval decision is needed. This preparation work is done in advance, allowing personnel to make decisions quickly when presented with pre-processed invoice information.

Inventive Principle:

Principle #10Preliminary action

2Ease of operation

If data is manually keyed into accounting or ERP systems, then flexibility in data entry is maintained, but errors increase and time is lost

Engineering Contradiction:

Improvedata entry flexibilityVSAvoiddata accuracy

Core Design Contradiction:

Ease of operationVSReliability

Solution Approach 1:

The system replaces the mechanical process of manual data keying with automated optical character recognition (OCR) technology. The OCR engine automatically extracts data from invoice images and populates the accounting system, eliminating human error while maintaining the flexibility to handle various invoice formats through intelligent data validation and correction algorithms.

Inventive Principle:

Principle #28Mechanics substitution (Replace mechanical system)

3Adaptability or versatility

If invoices are routed to remote personnel via email or fax, then decentralized approval is enabled, but tracking of invoice status becomes difficult

Engineering Contradiction:

Improvedecentralized approval capabilityVSAvoidinvoice status tracking

Core Design Contradiction:

Adaptability or versatilityVSLoss of information

Solution Approach 1:

The system implements comprehensive feedback mechanisms that automatically track and report invoice status at every stage of the approval process. When an invoice is routed to remote personnel, the system continuously monitors whether the recipient has viewed the invoice, their approval status, and any actions taken, providing real-time visibility to all stakeholders without requiring manual status checks.

Inventive Principle:

Principle #23Feedback

Solution Approach 2:

The system acts as an intermediary between the invoice processing system and remote personnel, using electronic notification systems to deliver invoices and automated tracking to monitor status. This intermediary layer maintains the decentralized approval structure while providing centralized visibility into the approval process through automated status tracking.

Inventive Principle:

Principle #24Intermediary (Mediator)

4Adaptability or versatility

If multiple formats of invoices are processed manually, then various vendor formats can be accommodated, but aggregation and data extraction become difficult

Engineering Contradiction:

Improveinvoice format compatibilityVSAvoiddata aggregation complexity

Core Design Contradiction:

Adaptability or versatilityVSDevice complexity

Solution Approach 1:

The system implements a universal data extraction framework using OCR technology that can handle multiple invoice formats through a single platform. The system is configured to recognize and extract data from various vendor formats, converting them into a standardized structure that can be processed uniformly, thereby accommodating diverse formats without requiring separate manual processes for each type.

Inventive Principle:

Principle #6Universality (Multi-functionality)

Data Source

PatentUS8165934B2Automated invoice processing software and services

Publication Date: 2012.04.24 MICRO GRAPHIC INFORMATION SERVICES CORP

AI summary

A method and system for automated invoice processing. An improved method for invoice processing based on an application service provider model in which invoices can be accessed and approved via the Internet from anywhere in the world. This method and system allows a company to manage the process of storing, reviewing, approving, and paying invoices from a single, centralized application. The invoice processing application is integrated with an accounting or ERP system such that payment can be made automatically and redundant data entry eliminated. The approval hierarchy used by the invoice processing application can be obtained from the human resources system of the client organization.