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How to Digitize and Automate Your Back Office

Steele Roddick 2019-03-18 09:30:00
Steele Roddick on Mar 18 2019

Before we get to the how, let’s start with the why

Too often software becomes a solution looking for a problem, a hammer looking for a nail. To avoid this issue, it’s best to start with real business problems and concrete business goals.


Digitizing and automating your back office solves four problems every transportation and logistics company faces:

  1. Missing documents and unbilled revenue
  2. Slow cash flow and reliance on factoring
  3. Poor visibility of organizational content and outstanding payables and receivables
  4. Inefficiency and inability to grow/scale without adding headcount


These problems can also be viewed as opportunities to improve. Digitizing and automating can help your business:

  1. Eliminate missing documents and reduce unbilled revenue to zero
  2. Reduce time-to-bill to minutes and the amount of time it takes to collect receivables by days
  3. Gain complete visibility into collections, corporate spending, and all freight documents
  4. Improve operational efficiency, operating ratios and ability to grow without hiring more administrative staff

The Inevitability of Technological Transformation

Solving problems and meeting goals sounds great, but often document management and workflow automation fall to the bottom of a long list of priorities.

The problem with this mindset is that technology is transforming the transportation industry. The T&L companies of tomorrow will be digital and automated. The economics are undeniable. It’s only a question of when.

Looking at history, technological change happens gradually, then suddenly. Day-by-day back offices are becoming more and more digital and automated. Sooner or later, seemingly overnight, the ones that failed to adapt will disappear.

The First StepOverview

Digitizing your process (having software do the work) is the first step. To do this, you will need a Document Management System (DMS) that can capture documents from a variety of sources and tag them with the appropriate information (also known as metadata), so they can be easily found.

A good DMS will be able to capture documents and information from:

  • Scanners (either in your office, at terminals, or in-cab units)
  • Email
  • Mobile Capture Applications (like LoadPal)
  • FTP, EDI and/or CSV
  • Other IT Systems (TMS, ERP, Accounting System, AMS, etc.)

The DMS will then save and store this information in a repository (think digital filing cabinet) where anyone can access it with a simple search.

The documents will also be tagged with information (metadata) which will allow for workflow automation, eliminate manual data entry downstream, and make all documents easy to find (making audits quick and easy).

The information documents can be tagged with includes but is not limited to:

  • Type of document
  • Load # or Purchase Order #
  • Amount
  • Date
  • Vendor or Customer

The major benefit of handling this digitally is that the indexing process can be automated using Optical Character Recognition (OCR), Transportation Management System (TMS) lookups, barcodes, Searchable PDFs, and/or Inbox Monitoring, removing much of the manual load on your administrative staff.

The Second Step

The second step is to automate your manual workflows and processes. This is accomplished with the help of an automation engine and pre-built workflows designed specifically for the T&L industry.

An automation engine can be used to automate specific steps such as:

  • Moving documents from person to person and office to office
  • Downloading, storing and organizing incoming email attachments
  • General Ledger coding and posting
  • Indexing documents
  • Checking freight documents into your TMS
  • Attaching proof-of-delivery documents and accessorials to invoices
  • Emailing out invoices with all attached documents
  • Sending email reminders to customers about outstanding payments
  • Matching incoming invoices with Purchase and Repair Orders
  • Validating invoice amounts against agreed terms (within thresholds)

Even better, an automation engine that integrates with your TMS, accounting system, ERP, AMS, and/or other IT systems can automate processes from end-to-end.


Accounts Receivable

With an automated AR workflow, every step of your billing process can be automated from the moment a POD is in your driver’s hands to the moment you send out an invoice. Your time-to-bill can be reduced to minutes and involve the simple review of the invoice and the click of a button.

AR v2

Accounts Payable

With an automated AP workflow, the process can be streamlined from end-to-end. Incoming vendor, maintenance and carrier invoices can be indexed, validated, approved and posted in less time with fewer errors. AP clerks are typically able to handle 3 to 5x more invoices in the same amount of time, allowing you to take advantage of early pay discounts, avoid late penalties, and ensure you have available credit with vendors at all times.

AP v2

Other Workflows

Best of all, a good automation engine can be used to create custom workflows, automating collections, factoring, payroll and remittances, hiring and driver file management, and any other repetitive manual task you can think of.


Return on Investment

Any discussion of implementing new software inevitably boils down to return on investment. Lots of software solutions sound good in theory but in practice aren’t worth the money. Either it pays for itself in spades, or it doesn’t.

That’s why starting with real business problems and objectives is essential. Success must be measured.

From our experience working with over 400 companies in the T&L industry, on average our Document Management System, Synergize, pays for itself in six months or less.

The return comes from:

  • Increased efficiency (automated tasks take no time or people)
  • Faster cash flow (every day off your DSO results in a lump sum of cash)
  • Reduction or elimination of hard paper costs (storage, courier, ink, paper, etc.)
  • Elimination of unbilled revenue (we’ve saved some companies over $500k)
  • Ability to scale (many of our customers have tripled or quadrupled their volume without hiring more admin staff)

efficiency cashflow elimination scaling

From a people perspective, a Document Management System provides better relationships with:better-relationship-09

  • Customers (fewer errors in billing, faster proof-of-deliveries, prompt responses to requests, no back-and-forth with collections)
  • Vendors (through prompt and accurate payments)
  • Drivers/owner-operators (faster and more accurate settlements, no arguments over missing paperwork)
  • Office staff (fewer headaches, easier day-to-day, focus on more value-added tasks)
  • Auditors (ability to quickly find any document from the past seven years in seconds)

Your return will ultimately depend on how many loads you’re doing, how much paperwork is typically associated with those loads (LTL versus TL), and what your current process looks like (the degree to which it is already digitized and automated).

Next Steps

The next step is to think long and hard about the future of your business.

The transportation and logistics industry is modernizing fast. The successful companies of tomorrow will be driven by technology. Your back office needs to be too.

Right now transportation and logistics executives are making the strategic decisions that will determine whether they go the way of Blockbuster or Netflix, Sears or Amazon, Polaroid or Canon, the taxicab fleet owner or Uber.

Digitizing and automating your back office is an essential step toward ensuring your business has true staying power in the automated, digital age. It’s time to take it.


Related Posts
What the Heck is Inbox Monitoring?
How to Take the Headache and Hassle Out of AP
5 Billing Problems You Can Solve With an Automated Workflow


Steele Roddick

Steele Roddick is a Content Specialist at Microdea where he creates content that helps transportation companies drive their business forward. He’s endlessly fascinated by technology trends, chess, and discovering new places to travel with his wife.

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