OAG AG: On the Safe Side with Digital Invoices: Customer Success Story
SAP Customer Success Story | Wholesale Distribution | ÖAG ÖAG AG: On the Safe Side withPicture Credit | ÖAG AG, Vienna, Austria. Used with permission. Digital Invoices
SAP Customer Success Story | Wholesale Distribution | ÖAGExecutive overview Company ÖAG AGCompany Industry Wholesale distributionVision Products and ServicesWhy SAP Sanitary ware, ventilation and air conditioning, heating, water supply, wastewater disposal, and pipe fittingImplementation Web Site www.oeag-ag.atSolution SAP® Solutions SAP® E-Invoicing for Compliance OnDemand solutionBenefitsFuture plans Every year, ÖAG AG was mailing up to 1 million invoices to its customers. Its goal, therefore, was to switch entirely to paperless invoicing — and in this way reduce costs and labor and create legally compliant processes at the same time. With the SAP® E-Invoicing for Compliance OnDemand solution, ÖAG has found the perfect way to achieve its objectives. 2
SAP Customer Success Story | Wholesale Distribution | ÖAGExecutive overview A world of sanitary ware and heatingCompany suppliesVision ÖAG AG — originally known as Armaturen- und Haustechnik (a partner of the plumbing and instal- Maschinenfabrik AG — was founded in 1871. Today, lation trade), KONTINENTALE Armaturen- undWhy SAP the wholesaler employs more than 830 people and Rohrleitungstechnik (plumbing and pipe technolo- serves the plumbing and installation industry out of gies), and FAP (partner for sanitary ware dealers).Implementation some 80 locations throughout Austria. With annual The services divisions consist of the Parts Center revenue in excess of €300 million, ÖAG is the largest (which supplies original spare parts and accessories company of its kind in the Alpine region. for heating systems, water heaters, boilers, and sani-Solution tary ware products from all the leading manufactur- ÖAG AG belongs to UK-based Wolseley plc and has ers) and the Miet Center (which rents out a broadBenefits three specialist business divisions and two central selection of tools and equipment ranging from drills services divisions. The specialist divisions are ÖAG to diggers).Future plans “We were mailing up to 1 million paper invoices to our customers every year. We knew that an e-billing process would not only save us time and money; it would also reduce our paper consumption and ensure legal compliance.” Patrick Schäffer, Business Process Optimization and Process Specialist, ÖAG AG 3
SAP Customer Success Story | Wholesale Distribution | ÖAGExecutive overview All-digitalCompany invoicingVision It was ÖAG’s e-business department that initially got the project off the ground. Its objective was to offer €25,000Why SAP Anticipated annual customers the option of receiving digital invoices. By doing so, it would not only satisfy the wishes of savings with e-billingImplementation a large number of ÖAG’s customers who wanted to receive their invoices more quickly. But, taking into Moreover, ÖAG’s management team was not content account the enormous volume of invoices that were with having only outgoing invoices created, signed,Solution being sent by mail every year, ÖAG would achieve and dispatched digitally. It also wanted to incre- significant savings on postage and on payments to mentally replace the process of capturing incomingBenefits a service provider that printed and mailed paper invoices from suppliers with e-invoicing. invoices. Overall, the company anticipated that by deploying e-billing, it would achieve annual savings Another requirement was that the chosen e-billingFuture plans of at least €25,000. and e-invoicing solution should be capable of recognizing, checking, and satisfying all the legal To implement the project successfully, ÖAG would requirements; otherwise the automated process need to integrate its chosen e-billing solution with its would not be legally compliant. When processing existing SAP ERP application, because this was the invoices from non–European Union suppliers, only way of incorporating an electronic invoicing pro- for example, it is vital to check that the incoming cess with the company’s other business processes. documents are compliant. 4
SAP Customer Success Story | Wholesale Distribution | ÖAGExecutive overview Digital invoices? No problem!CompanyVision Having investigated all the products currently ÖAG’s IT infrastructure is securely encrypted. available on the market, ÖAG opted for the SAP Managers at ÖAG can use a Web-based applicationWhy SAP E-Invoicing for Compliance OnDemand and the to monitor and inspect their company’s processes SAP Information Interchange OnDemand solutions at any time.Implementation because they support both e-billing and e-invoicing. Another vital factor in this choice was that SAP Another major advantage of ÖAG’s product choice E-Invoicing for Compliance OnDemand is offered is that the new SAP software and the company’sSolution by SAP as part of its on-demand model. This existing SAP ERP application integrate with one means, first, that ÖAG did not need to build up the another. This meant that the IT specialists at ÖAGBenefits knowledge required to map its electronic invoicing were able to link up the systems quickly and thus processes and, second, that its IT specialists do make the e-billing function available without delay. not have to handle the everyday operation of these Crucially, ÖAG’s employees did not require anyFuture plans business-critical components. special training, because, as far as they are con- cerned, the new digital process is the same as Through a service-level agreement (SLA), SAP the paper-based process that they are used to guarantees 99.5% system availability. In addition, working with. communication between the SAP data center and “The cloud-based solution from SAP is ideal for us. We don’t have to look after the operational side. Nor do we have to build up the knowledge required to maintain the software.” Patrick Schäffer, Business Process Optimization and Process Specialist, ÖAG AG 5
SAP Customer Success Story | Wholesale Distribution | ÖAGExecutive overview Winning with the cloudCompanyVision The management team at ÖAG made its decision to Among ÖAG’s customers — even very small busi- go with the SAP e-billing solution at the end of 2009. nesses, which tend not to have a strong affinity withWhy SAP Just three months later, the new software was up IT — buy-in levels for the electronic invoicing process and running. Two factors made this rapid deploy- have been very high. To date, 2,500 of ÖAG’s cus-Implementation ment possible. First, ÖAG did not need to install and tomers have switched to electronic invoicing, which operate any software or hardware itself. Second, SAP represents about 20% of the total invoice volume. In ERP and SAP E-Invoicing for Compliance OnDemand terms of paper consumption, this means that someSolution are designed to work perfectly together from the 320,000 sheets of A4 paper will be saved each year. start.Benefits Just a few weeks after the e-billing project began, a large proportion of those customers who hadFuture plans agreed to take part in electronic invoicing were already receiving invoices generated by the solution. “The process of implementing digital invoicing was totally smooth. Both our internal colleagues and our customers have taken the new process on board without any reservations.” Patrick Schäffer, Business Process Optimization and Process Specialist, ÖAG AG 6
SAP Customer Success Story | Wholesale Distribution | ÖAGExecutive overview Automatic posting is a realityCompanyVision ÖAG’s employees have not had to adjust to any and can therefore place new orders for stock auto- significant changes since the implementation. matically. Once the goods have been delivered, theWhy SAP Telephone sales personnel enter incoming orders manufacturer’s ERP software transfers the invoicing in the SAP ERP application in the same way they did information to the e-invoicing solution, which passesImplementation before. Orders are saved, and the picking process the data to the SAP ERP application at ÖAG AG. is triggered. Once the items have been booked and Third-party purchase orders can also be mapped in dispatched, the software automatically creates an this way.Solution invoice. And this is the only step that differs from the old one. The invoice is no longer printed on a local The SAP software checks incoming invoices forBenefits printer or processed and dispatched by a service plausibility, the correct date, and so on. If all the provider. Instead, the SAP software creates an in- details are accurate and there is a purchase order voice with a digital signature in PDF format. in SAP ERP that matches the invoice, then the openFuture plans amount is assigned automatically ÖAG’s suppliers are also benefitting from the new, digitalized process. The SAP solution communicates electronically with the systems of selected suppliers “Because the SAP software handles e-billing and e-invoicing, our customers as well as our suppliers are able to benefit from the solution.” Patrick Schäffer, Business Process Optimization and Process Specialist, ÖAG AG 7
SAP Customer Success Story | Wholesale Distribution | ÖAGExecutive overview E-billing as aCompany competitive advantageVision The benefits of e-billing are numerous. As well as cutting postage and other dispatch-related costs,Why SAP the digital approach also significantly reduces the ~4 time required for the billing process. From the pointImplementation of view of the customer, bills created in PDF format are much easier to store, and ÖAG’s customers also have the convenient option of accessing their billsSolution Trees expected to be in ÖAG’s Web shop. Larger customers receive billing saved annually due to information directly from the SAP software via elec- tronic data interchange (EDI), which means that they less paper usedBenefits can post items automatically.Future plans The previous, error-prone process of scanning in- coming invoices and performing character recogni- tion is now obsolete. Thanks to EDI, it is possible to post items automatically, provided the system has classified incoming invoices as compliant and correct. The e-invoicing software uses traffic-light indicators to show employees at a glance whether the invoiced articles and prices match the data in the purchase order. 8
ÖAG Executive overview Additional digitalization Company projects Vision Following its success with e-billing and e-invoicing, ÖAG is planning a number of digitalization projects. Why SAP Among other things, it would like more of its custom- ers and suppliers to switch to the e-invoicing format. Implementation It also wants to electronically exchange additional information, such as master data. Because over 2.4 million different articles are traded within the plumb- Solution ing and installation industry, the ability to match master data automatically would be most advanta- Benefits geous — especially since manual processes are no longer equal to this task. Future plans Patrick Schäffer, business process optimization and process specialist at ÖAG, concludes: “Our experiences with SAP E-Invoicing for Compliance Picture Credit | ÖAG AG, Vienna, Austria. Used with permission. OnDemand have been positive from beginning to end. Our management team is already considering undertaking additional EDI and digitalization projects in the future.CMP18813 (12/03) Copyright/Trademark | Privacy | Impressum 9
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