Long gone are the days of simple bill payment, as are the days when the burden of action rested primarily upon the payer’s shoulders. Changes in technology have produced automation on both sides, assisting the carrier as well as the customer. In the first wave of automation, carriers modified their invoice and billing process in their TMS systems. This reduced manual labor when invoicing and allowed staff to focus on collections. Customers processed invoices in a typical fashion, by either paying in full or paying a partial amount when they felt a bill was incorrect. In the event of a short pay or past due situation, it was reliant on the customer to justify the paid amount. The customer would work directly with the carrier in order to talk through the reasoning for the past due or short amount. This would either be approved and the bill would be adjusted, or there would be a balance due issued to the customer. The key in this scenario is that the customer was responsible for invoice verification and payment amounts as well as working directly with the carrier.
In the subsequent phase of automation, customers transitioned to their own TMS solutions, which provided inherent auditing capabilities or plugins to do so. To aid customers, these integrated systems provide checks and balances to ensure that invoices match expectations and rate quotations. The best systems provide full automation; in the event that “everything” matches, payments process with minimal customer interaction. However, in cases where an invoice does not meet expectation, manual intervention is required. Understanding the time required to clear these discrepancies, many customer TMS systems have been configured to provide carriers direct access to do the work to ensure invoices match quotes or provide adequate documentation to justify a difference. Instead of a conversation to talk through any discrepancies, the carrier is often directed to “look it up in the portal”. Simply put, these systems were designed to lay the onus on the carrier. Rather than a customer having to justify a short pay as in years past, the carrier now has to prove the validity and accuracy of an invoice. Additionally, this framework has caused a shift from short pays to non-pay situations. In order for payments to process, “everything” must match. Sometimes there is a significant bill difference, but it could also be only pennies; however, when a 100 percent match is required, even the pennies must be justified.
There will always be the need for some manual intervention; however, technology leading approaches will allow staff to focus on the exception cases and set companies up for streamlined payment processing, improving both accuracy and speed for all parties involved
As an example, if a customer’s system expected an invoice of $99.99, but the carrier billed for $100.00, that could very well be enough of a discrepancy to hold payment until resolved. This is an extreme example, but the reality in many situations is not too far off from this with customers maintaining a very small acceptable margin of variance. In an extreme case, like this example, a carrier would simply correct the bill to $99.99 in order to process payment. From a carrier perspective, having to verify each bill means staffing increases in order to log into all necessary customer portals to do the research and justification required just to get paid for services already rendered. As more customers transition to this model, and often with very little notice, there are hundreds of different portals to manage and little time to train new people to do so. This significant workload requires carriers to make a decision; either increase staff in an attempt to keep up or invest in the next phase of automation.
The latest wave of automation prompted by this situation is once again on the carrier side; technology leaders have invested in machine learning and robotic process automation solutions to replace many of the manual processes involving carrier facing customer web portals. Due to a variety of providers and interfaces, automation solutions are not a one-size-fits-all implementation; rather, solutions are built to handle subsets of portals. Efficiency is achieved by automating the largest value portals first. Based on the law of the vital few (aka the 80/20 rule), automation of a few portals can have a significant impact when they contain a large percentage of a carrier’s freight bills. Though work is still required by carriers to verify some invoices, robotic process automation has been a huge step forward in reducing the manual steps required to collect payment.
As AI, Machine Learning, and RPA solutions continue to mature, system integrations and automations will evolve as well. The companies that have invested, and continue to invest, in such solutions will continue to gain substantial efficiencies and reduce staffing requirements to handle manual repetitive processes. There will always be the need for some manual intervention; however technology leading approaches will allow staff to focus on the exception cases and set companies up for streamlined payment processing, improving both accuracy and speed for all parties involved.