Paying utility bills is hardly rocket science, surely?
Well, no, it’s not. But you might be forgiven for thinking it was—the tariffs, discounts, and usage periods are difficult to understand. Such is their complexity that even those utility companies that issue utility bills make mistakes; in our experience, one in ten utility bills contains an error.
When it comes to processing utility bills, an organization’s Accounts Payable or AP team certainly has its work cut out. They have to read, understand and confirm the detail they are looking at. The scale of information—hundreds of line items across multiple invoices—and the time needed to work through that information are positively astronomical.
The answer lies in automation. It reduces processing time and saves money. What’s more, it allows the AP team to come back down to earth and do what they are good at finding ways to save money for the business.
However, the question is with whom to partner to make it happen. Here’s what to look for when choosing a utility bill management provider:
A transparent process
Processing invoices manually is a costly business. Only with a fully automated system can you maximize cost savings. To do so, you’ll need a partner who can deliver complete control over the energy-spend lifecycle—from receipt to payment to reporting.
An automated process should provide transparency over the data that your business holds. The inability to see what is happening across the end-to-end process is a problem a fifth of AP leaders say is a priority for them to address. And that makes sense; having control over data allows them to turn it into an asset that informs decisions and enables the business to identify opportunities.
Real-time energy data
Collecting invoices automatically will undoubtedly save the organization time. But when exploring options, you must check the rate at which the billing data is uploaded and, therefore, available for use and reporting. Not receiving the information in a timely fashion may potentially cost you dearly. Critical decisions about budgets, acquisitions, and closures need a solid foundation in actual, rather than assumed, data.
In this regard, not all partners are the same. Some don’t upload data until a month after the bill has been released. This could impact your ability to fix problems and investigate anomalies quickly. You’ll end up feeling the impact in cost and missed opportunities.
In terms of utility data, if the organization adheres to best practices and adopts a utility management automation system, it has the power to make effective, data-driven responses. But any decisions made will only be as good as the data they are based on.
Automation and data management software brings substantial time savings, requires less human involvement, and gives any business the confidence that the data they are looking at is correct. And that’s important. A bill can have hundreds of data points covering usage, billing periods, and contract terms. Utility bill validation ensures the business is being billed for the correct amount under the right terms. Knowing that these key variables have been taken care of brings absolute confidence to the decision-making process.
The result is seen in significant cost savings. Sure, it can cost time and money to set up utility bill automation in the first place, but not so much that it should be considered a barrier to implementation. Bear in mind that almost a third of companies say they have had to overcome data quality issues before automating processes—believe it or not, many are still manually inputting their utility data into a spreadsheet.
What’s more, once the automation is up and running, the experts that spend a large proportion of their time entering data will be free to tackle work they are better suited to do. Work that, in itself, may help the business identify other ways to save money.
Solutions like Bid’s Utility Bill Management are designed to save businesses as much time and stress as possible in trying to process, validate and pay bills. And because it’s SaaS, it doesn’t come with a considerable capital outlay.
Improvements to the payment process
Once invoices have been collected and validated, they need to be paid. When you are looking for a partner, make sure their solution includes payment automation. Instead of alerting your team that an invoice is ok to pay, it takes that next step and releases payment.
That makes the process of paying bills even more efficient. 51% of organizations rate cost savings as the most crucial benefit of automatic payments. It improves the speed of invoice processing and has the ability to make electronic payments; not only are they faster and require less administrative effort, but they also carry fewer bank fees.
To put those savings into perspective, a 2019 survey showed that companies with best-in-class AP systems incurred a cost of just $2.18 to process a single invoice, end to end. For other businesses, the average cost was $12.60.
The right reporting
Data can frustrate and overwhelm if it’s not easy to follow and, just as importantly, access. When you weigh up partners, you’ll want to make sure the solution provides clean data that can be accessed anytime and anywhere.
A system that limits information availability is likely to lead to different business units having other parts of the story. The result is that the organization makes less than optimal decisions, the impact of which could be felt long into the future.
The different ways in which the data can be presented are equally important. Business leaders attend many meetings each day, and you’ll want them to take note of what your data is saying. It’s hard to absorb and be moved by numbers during dull and dreary presentations.
To make the most of the insights Big Data can provide, you’ll need data visualization. These are software programs that produce charts, graphs, infographics, and animations for use in reports, pitches, and online media. They enable an organization to tell punchy and insightful stories in a meaningful and relevant way, without unnecessary information clouding the message.
Sometimes, you only get one shot at presenting your numbers; make sure it hits the mark. Confirm your partner can give you data in a form that lends itself to visualization.
Without accurate historical data, the organization will be flying blind at budget time. It’s simply impossible to forecast key expenditures, like utility bills, without any insight into what came before—especially when things like energy consumption can be seasonal.
When exploring partners, make sure they can process historical usage data. The last thing you’ll want to find at budget time is that you’re missing essential information. A single data point is useless with nothing to compare it to, and you’ll want to make sure you don’t commit to any unachievable targets.
Likewise, come month-end, you’ll be expected to nominate accruals to account for invoices that you were expecting. For that to work, you’ll need a system that provides you complete visibility and accurate, up-to-date information. Without that, you’re relying on data that may not be correct. Accrue the wrong amount, and, whether it’s the current or following month, you’ll feel the warmth of the management accountants’ spotlight once the numbers are circulated.
When you’re talking to prospective partners, make sure you ask plenty of questions. Remember, not all solutions are the same. Bid’s digitized Utility Bill Management (UBM) is the only energy management platform with full Robotic Process Automation, capable of processing thousands of utility bills per minute. The cloud‐based platform simplifies the complex utility spend management process for small to large multisite businesses by automating manual billing processes to provide complete control over the full utility spend lifecycle.