This article is part of our comprehensive pillar guide on the digital office.
In many businesses, internal approval is still handled like this: a supplier invoice arrives, the assistant prints it out, physically takes it to the project manager (if they are not in the office, she waits until tomorrow), the PM signs with a blue pen, the assistant goes to the finance director, who also signs, and the invoice goes to accounting for posting. This process takes 3–7 days, and the result is a paper document that can be lost, illegible, or later disputed.
Approval workflows in modern ERP systems compress this process to 2–24 hours and add full traceability that the paper process lacked.
What Is a Workflow and Why You Need One
A workflow is an automated process that guides a document through all required steps — from creation, through approval, to archiving — without anyone physically carrying anything or sending emails along the lines of “Petra, can you approve this for me?”. In the ERP context, a workflow addresses these problems:
- Lost documents — no paper, no invoice lost in a colleague’s drawer while they are on holiday
- Unclear responsibilities — the workflow defines who approves what, no disputes
- Slow approvals — push notifications to mobile immediately, one-click decision
- No audit trail — nobody knows which manager actually approved that expensive purchase in March
- Human error — no typos in amounts, no “I’ll just sign it for you”
Sequential vs. Parallel Approval
The key decision in workflow design is whether approvers should proceed one after another (sequentially) or simultaneously (in parallel). Each approach has its place:
Sequential Workflow
The document passes through approvers one by one. The second approver sees the document only after the first has approved. Suited to hierarchical processes where the structure involves progressive escalation:
- Invoice: direct manager → department head → CFO (if amount exceeds threshold)
- Holiday request: team leader → HR (balance check)
- Employment contract: HR → management → legal
Advantage: clear hierarchy; management time is not wasted on invalid requests (blocked by lower approver). Disadvantage: longer overall duration.
Parallel Workflow
The document goes to all approvers simultaneously. The workflow continues only when all (or a defined majority) have approved. Suited when multiple roles assess different aspects of the document independently:
- IT investment: IT manager (technical suitability) + CFO (budget) in parallel
- Marketing campaign: marketing director (creative) + sales director (timing) + CFO (budget) in parallel
- Large project: project director + finance director + legal in parallel
Advantage: faster overall duration. Disadvantage: occupies multiple people simultaneously even if the request ultimately makes no sense.
Hybrid Workflow
The most advanced ERP systems support combinations — for example, on an invoice above 10,000 €, it first goes in parallel to technical (validates need) and financial (validates budget) review, and after their approval escalates sequentially to management. Modulario Workflows / Projects supports such combined schemes with a visual editor.
Escalations and SLAs for Approvals
A workflow without escalations will inevitably get stuck — the approver is on holiday, ill, forgot, or simply postponed it. An escalation is the rule “if X does not happen within Y hours, the request goes to Z”:
| Situation | Time Limit | Escalation |
|---|---|---|
| Approver on holiday | 0 hours (immediate) | Deputy (defined in HR profile) |
| Routine request, no response | 48 hours | Approver’s superior |
| Critical request (production) | 4 hours | Manager + SMS notification |
| Payroll request | 24 hours | HR director |
| Holiday request | 24 hours | Team leader’s superior |
| Approval below threshold (under 100 €) | 72 hours | Auto-approval (if routine type) |
Escalation rules are set per workflow type and are must-have, not nice-to-have. Without them, the workflow becomes a disappointment and people start bypassing the system with paper or direct messages.
Role-Based Approval Matrices
An approval matrix defines who approves which types of documents at which monetary thresholds. A standard matrix for an EU SMB with 30–100 employees:
| Document Type | Amount | Approver 1 | Approver 2 | Approver 3 |
|---|---|---|---|---|
| Standard invoice | up to 500 € | Team leader | — | — |
| Standard invoice | 500–5 €,000 | Team leader | Department head | — |
| Standard invoice | above 5,000 € | Team leader | Department head | CFO |
| Investment | up to 1,000 € | Department head | — | — |
| Investment | 1,000–10,000 | Department head | CFO | — |
| Investment | above 10,000 € | Department head | CFO | CEO |
| Order from strategic supplier | regardless of amount | Procurement manager | CFO | — |
| Employment contract | regardless of amount | HR director | CFO | CEO |
| Marketing budget (monthly) | above 2,000 € | Marketing director | CFO | — |
In Modulario, this matrix is configured once in the Workflows / Projects module and applies to all relevant documents automatically. When the organisation changes (new manager, department split), the matrix is updated and the workflow behaves according to the new version from the following day.
Concrete Use Cases for EU SMBs
Use Case 1 — Incoming Invoice Approval
Before (paper + email):
- Invoice arrives by post or email to the assistant
- Assistant prints it, places it in the project manager’s tray
- PM returns from a meeting, signs it, returns it
- Assistant takes it to accounting
- Accounting sends a copy to CFO if it exceeds 5,000 €
- CFO signs, returns it
- Accounting posts it
Duration: 3–7 days. Failure points: lost invoice, illegible signature, approver on holiday.
After (workflow in ERP):
- Invoice arrives at invoices@company.com, OCR processes it and automatically matches it to the purchase order
- Workflow starts — PM receives a push notification on mobile
- PM opens the card, cross-checks against the order, clicks “Approve”
- If above threshold, automatically continues to CFO (push notification)
- CFO clicks “Approve” → invoice is in accounting, ready for payment in the next payment run
Duration: 2–24 hours. Audit trail: full, including time, IP, and comment from each approver.
Use Case 2 — Purchase Order Approval
A marketing employee wants to order a promotional banner for 1,200 €:
- Creates a purchase order in ERP, enters supplier, amount, description, attachment (quote)
- Workflow → marketing director (in parallel) + CFO (budget)
- Both click “Approve” in the Slack card
- ERP automatically generates the order as a PDF, sends it to the supplier by email
- Upon delivery, the order is matched with the incoming invoice
Bonus: if the marketing director alone would exceed the monthly marketing budget, the workflow automatically escalates to CEO without any action from the marketing employee.
Use Case 3 — Holiday Approval via Mobile
A sales rep wants to take 5 days of holiday:
- In the ERP mobile app, selects the dates (15–19 July), remaining holiday balance is 12 days
- Clicks “Request” → manager receives a push notification
- Manager sees the card with the dates and a calendar showing 2 other team members already on holiday that same week
- Clicks “Approve” or “Reject with suggestion to reschedule to August”
- Approved holiday is recorded in attendance, sends out-of-office to Outlook, and feeds into payroll
This topic is covered in detail in the article on HR and Attendance in the Digital Office.
Use Case 4 — Supplier Contract Approval
A buyer is preparing a framework agreement with a new logistics partner:
- Generates a contract draft from a template in ERP
- Workflow → procurement manager → legal → CFO → CEO (sequentially)
- Each approver can add a comment or suggest a clause amendment
- After final approval, the contract goes for electronic signature (eIDAS) — bilateral (company + supplier)
- Signed contract is automatically filed in DMS with an expiry alert 60 days before end date
More on contracts and archiving in the article on DMS, Electronic Archive, and E-Signature.
Use Case 5 — Marketing Budget Approval
Marketing wants to run a Google Ads campaign for 3,000 €:
- Marketing manager fills in the request (objective, KPIs, budget, duration)
- Workflow → marketing director (in parallel with) → CFO
- After approval, the budget is allocated, registered, and the campaign is launched
- Weekly spend report is sent automatically to both approvers
- When 80% of budget is consumed, escalation triggers for re-approval
Approving via Mobile, Email, Slack, and Teams
The most advanced ERP systems allow approving outside the application itself — where the manager already spends their time:
- Mobile app — push notification, opens a card with details, swipe or tap for decision
- Email — approval card directly in the email body (Outlook Actionable Messages)
- Slack — bot sends a card to a direct message with “Approve / Reject / Open details” buttons
- Microsoft Teams — Adaptive Card in chat with the same functionality
- WhatsApp Business (rare) — link to an approval page with OTP authentication
Clicking “Approve” in Slack registers the decision in the ERP with user identification (Slack OAuth/SSO), timestamp, and IP address — everything enters the audit trail.
Practical example — IT firm with 40 employees: Before Slack integration, approving IT equipment orders took an average of 4–5 days. After deploying the bot that sends an approval card directly to the CFO’s Slack DM, the average time dropped to 3 hours — the CFO approves between meetings throughout the day instead of opening the ERP once every 2 days.
Audit Trail — What You Must Retain
The audit trail is a cryptographically secured log that records who, when, what, from where for every document:
- Document creation time + user
- Every read / opening + user + IP + device
- Every approval / rejection + user + IP + comment + timestamp
- Escalations (with reason — e.g. “auto-escalation after 48h inactivity”)
- Attachment additions, amendments
- Final state (approved, rejected, archived)
This log is read-only and cryptographically sealed — it cannot be altered retroactively. During a tax inspection or internal audit, simply export the audit trail for the relevant period and the inspector can see the entire process.
GDPR adds the requirement for an audit log of access to personal data (who viewed salaries, performance reviews, employee records). The Documents module in Modulario maintains this log automatically.
ROI of a Workflow System
For a typical EU SMB (30–80 employees, 200–1,000 documents per month requiring approval), a workflow system delivers these savings:
| Metric | Before (paper/email) | After (workflow ERP) | Saving |
|---|---|---|---|
| Average invoice approval time | 3–7 days | 4–24 hours | ~85% |
| Lost documents per month | 2–5 items | 0 items | 100% |
| Assistant time on “circulars” | 8–15 hours/month | 1–2 hours/month | ~85% |
| Time to prepare for audit | 3–5 days | 2–4 hours | ~90% |
| Early payment discounts lost due to late approval | 500–2 €,000/year | 0 € | 100% |
| ROI | — | 4–8 months | — |
Where to Start
Approval workflows are not rolled out all at once for every process. A practical approach:
- Month 1 — audit existing approval processes (what is currently approved, by whom, how long it takes)
- Month 2 — design the approval matrix (who approves which amounts)
- Month 3 — pilot deployment for one document type (typically invoices — highest volume, greatest benefit)
- Month 4–5 — expand to purchase orders, holiday requests, marketing budget
- Month 6+ — advanced scenarios — contracts, investments, hybrid workflows
Modulario Workflows / Projects has a visual workflow editor that allows a business user (not just IT) to configure and change workflows without coding. This is critical, because approval rules change as the company grows.
Related Resources
- Pillar: Digital Office and Process Automation
- HR and Attendance in the Digital Office
- DMS, Electronic Archive, and E-Signature
- Digital Invoicing and E-Invoices
- Workflows / Projects module
- Modulario Pricing
Frequently Asked Questions
What is the difference between sequential and parallel approval workflow? Sequential workflow proceeds step by step — first the project manager approves, then the finance director. Parallel sends the document to multiple approvers at once — for example, IT manager (technical suitability) and CFO (budget) simultaneously. Sequential is appropriate for hierarchical consensus; parallel when multiple roles assess different aspects independently.
What happens if an approver does not respond in time? Escalation. The workflow has a set time limit (typically 24–72 hours) and upon inactivity automatically forwards to a deputy, superior, or parallel node. Without escalations the workflow gets stuck — they are must-have.
Is approving via Slack or a mobile app legally valid? Yes. Clicking “Approve” registers the decision in the ERP with a timestamp, user identification (Slack OAuth/SSO), and IP address — all part of the audit trail. For internal processes (invoices, orders, holidays), fully equivalent to signing within the application. For external supplier contracts, an official e-signature (eIDAS-compliant) is required.
How many approval levels is optimal for an EU SMB? For most SMBs, 2–3 levels are sufficient. Standard matrix: up to 500 € direct manager, 500–5 €,000 plus department head, above 5,000 € plus CFO. More than 4 levels becomes counterproductive.
What audit trail does GDPR and a tax audit require for approval workflows? Full log: timestamp of each action, user identification, IP address, device, comment. The log is read-only and cryptographically sealed. During a tax authority inspection or audit, simply export for the relevant period.