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Leveraging AP Automation
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Judy Bicking Jason Anderson
Jason Anderson is a Business Development Manager at Esker and has been with the company for 14 years. In addition to being a Business Development Manager, he has served as a technical resource to Esker’s customers, partners and internal sales team. His primary focus has been helping companies gain greater return on their ERP investment in the Order to Cash and Procure to Pay spaces. Customers that Jason has worked with include Whirlpool, Mars, Assa Abloy, Akzo Nobel and LifeNet Health.
Judy Bicking is a 27 year veteran of Johnson & Johnson. Her career has been focused on Procure -2-Pay, Order-2-Cash, and developing Shared Service Centers in the U.S. and Europe; earning high recognition for process improvement and major cost savings. She led the first department to earn IOFM AP Departmental Certification designation. Today she is a Public Speaker, does consulting in O2C and P2P and participated as co-founder and played a major role in writing and conducting certification training in these fields. She also owns and operates a retail department store along with her passion in doing mission work at home and abroad.
Taking a hard look at AP:
• How can AP accomplish their mission?
• What is their mission?
• Does your organization blame AP for ‘late” payments?
Taking a hard look at AP:
• How can AP accomplish their mission?
AP can not validate what was received or approve the purchase, without the organizations cooperation.
• What is their mission?
To pay invoices accurately and on time
• Does your organization blame AP for ‘late” payments? YES
How the Work is Accomplished
• Hard working
• Tenacious
• Dedicated
• Determined
• Tries to implement solutions
• Continues to show up every day
Best Practices
• AP: desperate to “fix” the process • Tried to convert paper to ‘e’
– Expensive – Time consuming
• Bottlenecks – AP “walks” it through
• BP’s: ERS / Negative Receipt – Met with resistance
• Very little technical support (overhead) – Lacks reliable metrics; reacts to noise
AP’s Mission
• Processing invoices is what AP does
• Their missions should be to: Work with procurement to map & set a cohesive process for all goods and services required to run the business and pay the suppliers accurately and on-time
Why P2P…T2R
• The process should ensure: – Orders are approved before procuring
• Preferred Suppliers (negotiated prices, terms, frt.)
– OFAC
• Budget compliance
• Cash Management (cash vs debit)
• Financial Reports
• Accurate & On-Time Payments • Supplier Relationships
• Discount Management
Strategy
• Is there a company’s purchasing strategy?
– Inventory vs MRO
• Maverick? Anyone can buy what ever they want, where ever, when ever???
– Preferred Suppliers? Requires homework
• How much is being spent?
– Procurement System vs AP’s Data
Metrics
• How much spend is nonPO?
• Volume of nonPO invoices?
• What commodities should be nonPO?
• How much could have been saved if price, terms and freight could have been negotiated?
• Are suppliers being paid on time from date of invoice?
Best Practices
• AP: desperate to “fix” the process • Tried to convert paper to ‘e’
– Expensive – Time consuming
• Bottlenecks – AP “walks” it through
• BP’s: ERS / Negative Receipt – Met with resistance
• Very little technical support (overhead) – Lacks reliable metrics; reacts to noise
Automation
• That controls the process
• Provides visibility with metrics: noise vs reality
• Prevents noncompliance:
– Laws & Regulations
– Visibility: Who has it? (it’s not AP)
– Escalation
• Efficient & Cost Effective
– Eliminate paper & copies & files & files
AP Invoice Processing An All-In-One Solution
Capture & dispatch
KPI & dashboards
Invoice verification
interface Workflow
Mobile application
ERP integration
Supplier Portal
Automatic
dispatch Multi-media
support Invoice batch
handling
Automatic Dispatch
Multi-media support
Invoice batch handling
Immediate Access To Invoices
Per user Special queues Per company
code
EDI Email Fax Portal Any format OCR and Text
Automatic document detection
Separator based split Easy-to-use web
interface
Invoice Dispatch Multi-Media Submission
Batch Handling
Capture & dispatch
KPI & dashboards
Invoice verification
interface Workflow
Mobile application
ERP integration
Supplier Portal
Design
Share
Customize
AP Invoice Processing An All-In-One Solution
DESIGN as many dashboards,
views and reports as you need
SHARE with
colleagues & stakeholders
100% customizable
views, metrics & charts
Dashboards. Key Information At-A-Glance
Capture & dispatch
KPI & dashboards
Invoice verification
interface Workflow
Mobile application
ERP integration
Supplier Portal
PO invoice verification
Non-PO invoice verification
Payment approval
AP Invoice Processing An All-In-One Solution
Matching invoice lines
with POs and Good
receipts
TOUCHLESS PROCESSING AUTOMATIC 3-WAY MATCHING EXCEPTION HANDLING
Invoices are automatically matched with the corresponding PO lines and good receipts so that invoices can be automatically processed when there is no exception.
PO-Invoice Verification
Non-PO Invoice Verification
Original invoice image
Annotation tool
Captured information
location
Automatically captured invoice
data
Access to preview invoices from the
same supplier, duplicate invoice
detection
Processing workflow steps
PROCESSING EFFICIENCY
• Multi-languages • GL and Cost Center Coding templates • Automatic workflow determination
PROCESSING ACCURACY
• Duplicate invoice detection • Data checks against master records • Invoice balance verification
Invoice data is automatically verified against master data speeding up AP verification process.
Capture & dispatch
KPI & dashboards
Invoice verification
interface Workflow
Mobile application
ERP integration
Supplier Portal
Payment approval
AP Invoice Processing An All-In-One Solution
Payment Approval Workflow
APPROVAL FORM
ORIGINAL INVOICE IMAGE
EMAIL NOTIFICATION
Required approvals list
Only necessary information is displayed to approvers
Access to previews invoices from the same
supplier
PROCESSING EFFICIENCY
• Easy access to necessary information • Exceptions handling and qualification • Comments log
Capture & dispatch
KPI & dashboards
Invoice verification
interface Workflow
Mobile application
ERP integration
Supplier Portal
Invoices queue
Notifications
Coding and Approval
AP Invoice Processing An All-In-One Solution
Mobile Approval
Esker Anywhere enables convenient on-the-go access to invoices and purchase requisition approval, coding and review.
EASY ACCESS TO KEY DATA
ORIGINAL DOCUMENTS DISPLAY
DOCUMENT LIST LINE ITEMS WITH GL AND CC CODING
• STREAMLINE BUSINESS PROCESSES • REDUCED COSTS • ON-THE-GO APPROVALS
Capture & dispatch
KPI & dashboards
Invoice verification
interface Workflow
Mobile application
ERP integration
Supplier Portal
Purchasing App for SAP
Certified SAP integration and can work with Multiple ERPs
AP Invoice Processing An All-In-One Solution
Capture & dispatch
KPI & dashboards
Invoice verification
interface Workflow
Mobile application
ERP integration
Supplier Portal
Easy supplier onboarding
Invoice upload
Invoice batch handling
Online conversation
AP Invoice Processing An All-In-One Solution
Supplier Portal
COPY / PASTE
Featuring:
Online conversation tool
Payment details access
Invoice upload option
Invoice payment status counters
Adding a Look At The Purchasing Process
Purchase requisition
Purchase requisition approval
Purchase Order creation
Invoice receipt
3 way-matching
Invoice Posting
Adding a Look At The Purchasing Process
Verification that quantity and price
invoiced match open PO lines
Lines are filled in automatically, based
on order number found in the invoice
Invest to Gain Major Savings
• Loosing money to major savings
– Mapping the current process (don’t miss anything)
– AP Data:
• What is being purchased, from whom, at what price
• Invoices Paid on Time: from date of invoice
• First Pass
• Cycle Time from date of invoice
• Cost per purchase (P2P)
• Types of Bottlenecks
Document Automation
• Receive the invoice directly from supplier – All formats vs EDI – Turn paper into an e-document
• Auto match • Route nonPO invoices & mismatches effectively • Know the location of the invoice • Real data to:
– Remove bottlenecks – Reduce cycle time – Study the spend
Document Automation
• Gain Control over the CASH: real time data – Quicker visibility of spend
– Forecast when dollars needed to cover spend
– Comply with OFAC: High fines, jail
• Ensure AP receives the invoice day ONE – Cycle Time = Payments on-time
– Visibility
• Vendor Portal – Payment info (less phone calls & emails)
– Receive Government forms and supplier updates
Bottom Line Savings (1)
• Real Cost saving
– Discount Management
• Supplier Offered & Dynamic Discounts
• A 2% early payment discount is equivalent to 36% annual interest rate!
– Operational savings:
• Gartner Group: a 5% reduction in operating costs equals a 30% increase in sales in terms of effect on the bottom line!
Bottom Line Savings (2)
• Spend Management
– Pre-negotiated price, terms, quality, deliver VS. buy what ever, from where ever, at whatever cost and overnight delivery
• Accurate and timely closings
– Financial Statements: no surprises
•Key Drivers: › A home-grown workflow that required each invoice to be
scanned in with a bar code
› No standard approvals or schedule of authorizations (CEO was approving everything over $1,000)
› Invoices did not have a purchase order (PO) attached
› Procurement and AP were not in alignment
• Solution: › Cloud AP solution allowing for growth and worldwide
usage.
•Results › Automated electronic workflow
› Digital archive of 100% of invoices
› Complete elimination of paper invoicing
› 95% on-time invoice payment rate
+95
•Key Drivers: › Processing about 30,000 invoices per month
› Invoices stored in “hard copy” and the nature of having a file room made processes challenging
› Lack of visibility
• Solution: › Accounts payable automation that included processing,
workflow and archiving capabilities
•Results: › 100% Improved visibility
› Easier access to invoices
› 12 day reduction in freight processing time
› Cost savings equal to 3 FTEs
› 50%+ more invoices processed per day
› $8 million reduction in outstanding accruals
› $28,815 increase in early payment discounts
About Esker
• Worldwide presence
› 10 offices, 400+ employees
› 1 out of 4 dedicated to R&D
› 30+ years of experience
• Large customer base
› 11,000 active document automation customers worldwide
› 20M documents processed each month
› 5,500 SaaS customers, 320,000 users
• Work with any ERP – Multiple ERPs – Multiple Instances of SAP
Check out Esker at upcoming
Tradeshows!
IOFM AP & P2P Spring Conference & Expo
–May 7th- 9th
–We will be located at booth 500!
– For more information visit: www.iofm.com/conference-spring
Thank You!
Questions after the event? E-mail [email protected]
We hope to see you at a future AP & P2P Network event! For upcoming events please visit
www.app2p.com.