Abby MorrisConference Services

Business Manager

Front End Accounting Process

All slides originally developed and supported by William Peterson, LeanBP.com

Mission

Vision

To generate revenue for Berea College by making use of

unused or under used facilities while ensuring compliance,

mitigating risk and ensuring profit.

Elimination of need for quarterly and random quality checks

while creating accurate electronic records for audit and record

keeping purposes with full implementation by April 1, 2018.

1. Mission - To generate revenue for Berea College by making use of unused on under used facilities.

2. Burning platform – Increased business and higher internal expectations require better processes

3. Process Description – From when the customer contacts Conference Services to the collection of any outstanding balance

4. Problem Statement – The current process results in frequent rework and doesn’t provide a way to track customer accounts/errors/audits.

5. Sponsor – Derrick Singleton

6. Process Owner – Abby Morris

7. Team Lead – Abby Morris

8. Facilitator – Abby Morris

9. Team – Abby Morris, Alane Poff, Amanda Cobb, Aaron Beale, Brandon Noble

Charter

SIPOCSuppliers Inputs Policies Outputs Customers

Conference Services

Facilities Management

Food Service/Catering

Berea College Legal

Counsel

Accounting Department

External and Internal

Clients

Primary Contact

Information

Cleaning and

Maintenance

Catering Services

Legal Guidance

Revenue Tracking

Client System

Management

Rental Request (Name,

Event Date, Size,

Affiliation with College,

Company)

Berea College

Financial and Cash

Handling Policy

Berea College Insurance

Policy

Contractual Policies

Financial Compliance

Policy*

Facility Rentals

Event Programming/

Planning

Catering Services

Customer Information

Contract

Invoice Info

Payment

External customers (no

affiliation with Berea

College)

Faculty/Staff/

Students/Alumni/Retire

es

Accounting

Department

Hi-Level Process Map

Payment Received

Payment Deposited at

Student Services

Event Happens

Any Outstanding

Balance Collected

Random or Quarterly Audit

of finances occurs

Volume = 120 events (annually)

WIP = 10

Lead Time = 2-4 weeks (Contract)

Rework = 100%

Constraint = Payment deposited at Student

Services. This step provides no electronic

records requiring quarterly audit and quality

checks.

Strengths Weaknesses

ThreatsOpportunities

SWOT Analysis

Inte

rnal

Ex

tern

al

• Limited Space/More business

• Campus Policies

• Competitors (especially Local)

• Established Process for interactions

with Finance

• Increased Campus Support

• More resources focused on sales

• Inadequate Current Processes for projected

growth

• Lack of staffing during peak times

• Lack of mission awareness

• Great Saleswoman

• No Overhead

• Strong Sponsor Support

Gap Analysis Opportunities and Priorities

Inaccurate audit and quality checks

Waste filled, time consuming, and unsatisfying security deposit refund procedure.

Paper based records system housed in 2 separate offices on Campus resulting in poor situational awareness.

Lack of access to records results in poor customer service.

No accurate “aging report” available with current system, risking revenue.

“Loose” cash handling procedure.

The current process doesn’t

provide a way to track Customer

accounts/errors/audits.

Current State

Current State Quality Check

Cause and Effect DiagramLack Of

Org. Focus Inventory Transportation Motion

Waiting Defects Overproduction

Undesirable

Effect

Over-processing

Lack of appropriate

customer info

Inability to track

customer payments

Constantly trying to

track down customer

information

Payment status

not visible in current

system

Moving of

paper files

Sorting through

paper files

Payments through

Accounts Payable only

happen bi-weekly with

extended processing time

Meetings between

Conf. Services staff

Needed due to paper

based records

Action Plan

• Develop accounting “path” through Accounts Receivable to allow for same day refunds, aging reports, ability to process security deposits without need for clients W-9.

• Develop “Remittance Slip” as part of contract to allow clients to mail/deliver payments directly to Accounts Receivable and ensure deposits made to proper revenue accounts.

• Elimination of paper records by utilizing BOX file sharing system.

• Easy access to Conference Services accounting records electronically for all Conference Services staff and VP of Operations.

• Reduce handling of cash and checks by directing payments directly to Accounts Receivable, and establishing ability/procedure to process Credit Card payments.

Future State

Future StateCredit Card Process

1 Value Added vs. 5 Non-Value Added process steps1 handoff (indicated with Orange box)

Standard Work for Electronic Filing System

Remittance Slip and Statement

Standard Work for Remittance Slip and Statement

Examples of Lean Countermeasures Used

• Developed Standard Work/defined procedure for handling of cash/checks/credit card payments.

• Developed Standard Work for review of account statements and balances.

• Visual Management enacted with development of process flow diagram.

• Standard Work for creation of electronic filing system. ELIMINATION of paper records!

• No batching. Accounts processed as “one-piece flow”.

ResultsApproximately 25% of current contracts require some form of “random check” as illustrated in slide 13. The “Future State” eliminates both these random checks and the quarterly checks, provides detailed monthly reporting on account status, and allows for customer friendly processing/refunding of security deposits.

Current State:

Random Checks: 30 events (25%) require “random checks” taking on average 1hr 25 minutes per check. $1,269 annual cost (1.41hr.*30 events*$30)

Quarterly Checks: 4 Quarterly Checks performed annually taking on average 17hr 25 minutes per quarter. $2089 annual cost (17.41*4*$30)

Future State:

Random and Quarterly Checks completely eliminated!

Total Savings: $3,358!!

Results“The new changes to our accounting process make it much easier to keep track of outstanding balances and payments that have already been made. We can also accept security deposits for event spaces and have those refunded with ease. We have been able to move from a paper system for filing to an online system in Box. Deposits are paid directly to accounting and this removes us from the cash handling business. The new process makes it more efficient for us to do our job.”

Amanda Cobb, Conference and Events Manager

Progress Check

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