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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

Esker’s AP Automation

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

Invoice Posting/Document Archive

SAP/ERP

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

Reporting/Dashboards

Standard report overview Standard reports delivered with the solution

Common Mistake

• Reducing headcount

– One time hit

– Small in comparison to:

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

Success Stories

•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 webinars@iofm.com

We hope to see you at a future AP & P2P Network event! For upcoming events please visit

www.app2p.com.