**London**: The integration of generative AI in supplier relationship management is enhancing efficiencies and streamlining payment cycles, with significant benefits in invoice processing, fraud detection, and operational performance, according to experts in the field.
The integration of generative artificial intelligence (GenAI) into supplier relationship management (SRM) is fundamentally reshaping the dynamics between businesses and their suppliers, enhancing the efficiency of processes while promising a more streamlined approach to payment cycles. According to a discussion on payment developments, this transformation is largely driven by those involved in B2B payments, as companies collaborate to reduce reliance on paper and manual processes.
One of the central components of a successful transaction between buyers and suppliers is the invoice, which serves as a critical link in the workflow between buyers’ enterprise resource planning (ERP) systems and accounts payable systems. Alex Hoffmann, the general manager of North America at Edenred Pay, highlighted the promising capabilities of advanced technologies in this regard. He stated, “For a long time, the industry has offered up paperless alternatives to payments,” referencing innovations like virtual cards and real-time payments. Hoffmann asserted that “what GenAI adds on top of all this is that beyond the payment, we can automate the invoice-to-pay cycle.”
During the “What’s Next in Payments: Memo to the GenAI Companies” conversation, the discussion centred on how organisations are embracing these advanced technologies to enhance operations. Hoffmann underlined GenAI’s transformative effect within the Chief Financial Officer’s office and its accounts payable processes. He explained, “GenAI may be most transformative… a tool to extract invoice headers and line-item data in various formats, spanning PDFs, images and even handwritten documents.” This advancement significantly reduces the manual effort required for data capture, thereby minimising the chance of errors associated with traditional methods.
Industries renowned for their reliance on paper invoices, such as hospitality and property management, are already benefitting from these advancements. Hoffmann pointed out that Edenred has developed solutions to optimally handle high volumes of transactions across multiple revenue streams in the hospitality sector. In property management, generative AI simplifies handling invoices that may be scattered over a wide area comprising numerous properties.
Moreover, Hoffmann noted that GenAI enhances the approvals process, creating more dynamic workflows. Unlike earlier technologies that merely set payment parameters, these innovations can now automatically route invoices to designated parties, particularly for specified payment amounts. However, as technologies develop, the need for fraud prevention remains paramount. Hoffmann cautioned, “where there’s money, there are crooks.” Here, generative AI enhances fraud detection, allowing businesses to identify anomalies that could indicate fraudulent activity or compliance issues, particularly during the supplier onboarding phase.
In this context, Hoffmann mentioned that generative AI facilitates the utilization of autonomous fraud agents to monitor and analyse data anomalies across various applications. This technology tracks the movement of invoices, therefore establishing a comprehensive approach to fraud management.
Furthermore, the data and technology arising from these innovations not only improve operational efficiency but also fortify the relationships between buyers and suppliers. Hoffmann elaborated on the potential for extending credit and payment terms to suppliers, driven by the data generated through this sophisticated technology.
As the utilisation of generative AI evolves, the establishment of standards for developing and deploying AI models will be crucial. Hoffmann anticipates a future in which organisations can specify the exact model of AI they are using—“ChatGPT Model No. 5,” for instance—along with its functionality and associated security measures.
In conclusion, Hoffmann underscored that streamlining the invoice-to-pay cycles through generative AI will lead to enhanced supplier relationships and increased payment accuracy, indicating a significant shift in the landscape of supplier management practices.
Source: Noah Wire Services
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