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TELUS: How To Turn Your AP Department into a Revenue Generator

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There are three ways to turn your AP Department into an efficient revenue generator while strengthening supplier relationships:

1. Increase supplier early payment discounts
2. Move from paper to electronic invoices
3. Eliminate inquiries on invoice approval and payment statuses

This can all be achieved by implementing a dynamic discounting, eInvoicing and supplier self-service solution.

Ron New, VP, Finance Operations and Gary Silsbe, Director, Finance Operations at TELUS, discusses the company’s pain points prior to implementing a solution, lessons learned from implementation, and how TELUS has transformed their payables department.

Learn TELUS’ plans for increasing discount capture, converting all paper invoices to electronic, achieving a full solution for Service Purchase Order processing, including approval integration and invoice posting and synchronizing all Advanced Shipping Notices.

TELUS discusses:

How and why to implement a portal use policy
How TELUS will save millions through early payment discounts
How to track the right metrics and set attainable goals
Learn from a company who has experienced implementation already.

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TELUS: How To Turn Your AP Department into a Revenue Generator

  1. 1. TELUS WEBINAR How TELUS Turned Their Payables Department into a Revenue Generator January 30th, 2014
  2. 2. H O W T E L U S T U R N E D PAYA B L E S D E PA R T M E N T I N T O R E V E N U E G E N E R AT O R Introductions VP Finance Operations TELUS RON NEW Director, Finance Operations TELUS GARY SILSBE
  3. 3. Customers 13.1 million customers Revenue: $10.9B annual revenue Employees: 41,400 employees About One of the leading national telecommunications company in Canada Headquarters Vancouver, British Columbia Product / Services Provides a wide range of communication products and services including wireless data, internet protocol, voice, TV, entertainment and video H O W T E L U S T U R N E D PAYA B L E S D E PA R T M E N T I N T O R E V E N U E G E N E R AT O R TELUS Case Study: About TELUS
  4. 4. H O W T E L U S T U R N E D PAYA B L E S D E PA R T M E N T I N T O R E V E N U E G E N E R AT O R TELUS Case Study: Highlights LivesinceAugust 2013 1,500Suppliersin Scope [others are independent retailers that aren’t applicable] 1,235SuppliersInvited and532Suppliers Enrolled 43% enrollment rates (without policy) . Captured$250,000 DiscountsCaptured Go-LivetoDate [80% Canadian, 20% U.S.] Currently $60,000 monthly, trending towards $100,000
  5. 5. H O W T E L U S T U R N E D PAYA B L E S D E PA R T M E N T I N T O R E V E N U E G E N E R AT O R TELUS Case Study: The Challenge Main challenges TELUS was facing prior to looking for an all-in-one solution: o Limited number of discounts being captured DISCOUNTS o Processing invoices was costly and took up numerous resources o Manual invoicing process INVOICING o Managing vendor requests and inquiries took up a large portion of administartion time o Needed portal in both French and English languages PORTAL
  6. 6. H O W T E L U S T U R N E D PAYA B L E S D E PA R T M E N T I N T O R E V E N U E G E N E R AT O R TELUS Case Study: Before Implementation Invoices must be manual scanned and indexed Invoice entry can result in duplicates and errorsEntirely manual invoice process: one team scans invoices, another indexes and posts Capturing discounts from 200 suppliers Suppliers call into AP Department for invoice inquiries Receiving 15,000-20,000 paper and PDF invoices per month
  7. 7. H O W T E L U S T U R N E D PAYA B L E S D E PA R T M E N T I N T O R E V E N U E G E N E R AT O R TELUS Case Study: Concept Overview • Automated Discount Negotiation Solution • Pro-rated Discounts • Electronic Invoice Delivery • Increased Effciency from Automation • No Touch Processing for PO’s • Comprehensive Supplier Portal KEY OBJECTIVES • TELUS – Increase Discounts Captured – Decrease Paper Invoice – Improved Supplier Relations – Fewer Incoming Inquiries – More Efficient Cash Flow Planning • SUPPLIERS – Increased Flexibility of Cash Flow – Supplier Self-Services – Faster Invoice Processing • Increase profit margins through increased supplier discounts • Decrease operating expenses in AP through: – Decreased Manual Invoice Processes – Decreased invoice inquiries KEY BENEFITS STRATEGIC OPPORTUNITY Dynamic Discounting will help TELUS to increase supplier discounts by offering to pay suppliers 5-40 days prior to due date. Also facilitates conversion of paper invoices to electronic.
  8. 8. H O W T E L U S T U R N E D PAYA B L E S D E PA R T M E N T I N T O R E V E N U E G E N E R AT O R TELUS Case Study: Key Deliverables 01O N B O A R D 02I N V O I C E S 03D I S C O U N T S 04S A V I N G SOn-Board 500 Suppliers onto network within 12 weeks of implementation Convert invoices from paper to electronic for on- boarded suppliers Provide suppliers with sliding scale of discount options for early payment election Realize an additional $1M - $3M in discounts annually
  9. 9. H O W T E L U S T U R N E D PAYA B L E S D E PA R T M E N T I N T O R E V E N U E G E N E R AT O R TELUS Case Study: Progress 01O N B O A R D On-Board 500 Suppliers onto network within 12 weeks of implementation 1,235 suppliers Invited 532 suppliers enrolled (43%) Convert invoices from paper to electronic for on-boarded suppliers Setting up eFile for large volume suppliers (connecting AR system to the portal to ensure all invoices are coming through SAP with discounts being offered) Provide suppliers with sliding scale of discount options for early payment election Available discount of up to 2% on supplier invoices Suppliers getting paid on timely basis depending upon discount terms chosen Realize $1M - $3M in supplier discounts annually Captured $250,000 in discounts since go-live Trending towards $100,000 monthly 02I N V O I C E S 03 04 D I S C O U N T S S A V I N G S
  10. 10. H O W T E L U S T U R N E D PAYA B L E S D E PA R T M E N T I N T O R E V E N U E G E N E R AT O R TELUS Case Study: Portal Activity 0 500 1000 1500 2000 2500 Vendors Invited Vendors Enrolled Invoices Submitted
  11. 11. H O W T E L U S T U R N E D PAYA B L E S D E PA R T M E N T I N T O R E V E N U E G E N E R AT O R TELUS Case Study: Key Learnings & Next Steps Dynamic Payment Terms Contractually agree that the buyer will pay every invoice as soon as it is approved in exchange for a discount. eFile EDI connectivity for large suppliers to connect billing system in any format and through any channel. Portal Policy Enforce portal policy for all suppliers to mandate usage of electronic invoicing and the portal. Engage Procurement Team in Beginning of Process PROCUREMENT Achieve discounting savings of $1M - $3M annually Increase number of electronic invoices Reduce supplier inquiry calls METRICS MATTER NEXT STEPS:
  12. 12. H O W T E L U S T U R N E D PAYA B L E S D E PA R T M E N T I N T O R E V E N U E G E N E R AT O R TELUS Case Study: Portal Policy Develop a Portal Use Policy Portal policy to be used as “Go-To Guide” on best practices for suppliers using the portal and how to achieve maximum benefit Example: “To improve communication with our suppliers and provide them with increased transparency into our invoice approval and payment process, we are requiring our suppliers to enroll in and interact with us through our free supplier portal.” Electronic Submission of all Invoices Inquiries About PO’s Updates to Vendor Master Information

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