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Beyond Scanning: Enabling Straight-Through Invoice Processing across All Spend Categories
The document discusses the transition to digital invoicing to address issues caused by paper invoices, which account for nearly 80% of all incoming invoices, resulting in significant costs and inefficiencies. It highlights the benefits of an e-invoicing program, such as improved compliance, reduced processing times, and substantial savings in discounts and operational costs. The program aims to enhance invoice automation and supplier management, ultimately leading to greater efficiency and financial savings for organizations.
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Similar to Beyond Scanning: Enabling Straight-Through Invoice Processing across All Spend Categories
Beyond Scanning: Enabling Straight-Through Invoice Processing across All Spend Categories
- 1. #AribaLIVE @ariba #AribaLIVE @ariba Beyond Scanning: EnablingStraight- Through Invoice Processing across All Spend Categories Chris Rauen, Solutions Marketing, Ariba – an SAP company Ed Aderman, Financial Program Manager – Global Procurement, Reed Elsevier April 9, 2015 © 2015 Ariba – an SAP company. All rights reserved.
- 2. #AribaLIVE @ariba#AribaLIVE @ariba Problemswith Paper • Improper coding • Lack of terms • Wrong amount • Post-audit recovery • Exceptions, exceptions, exceptions • Long…cycle… times • What invoice? • Lack of visibility • Lost discounts • Overpayment/ duplicate payment I know.. SCAN the paper!
- 3. #AribaLIVE @ariba#AribaLIVE @ariba Powerlesswith Paper © 2015 Ariba – an SAP company. All rights reserved.3
- 4. #AribaLIVE @ariba#AribaLIVE @ariba TrueCosts of Paper Invoicing “Nearly 80% of all incoming invoices are still paper based.” - The Hackett Group Receipt & Capture Receipt & Capture High Cost of Paper Invoices “$4.6 million in contract leakage per billion in spend on average.” - The Hackett Group Matching & Approvals Matching & Approvals Lack of Compliance “15% of invoices have exceptions” - TAPN Inquiries & Exceptions Inquiries & Exceptions Too Many Exceptions “80% of early payment discount opportunities missed.” - Ariba Discounts & Payments Discounts & Payments Lack of Control © 2015 Ariba – an SAP company. All rights reserved.4
- 5. #AribaLIVE @ariba#AribaLIVE @ariba Buyer& Seller Benefits $2 million discount savings per $1B spend DSO Reduction of over 6 Days Spend Savings $400K+ in AP Error & Fraud Elimination per $1B in spend $4M per $1B of contract leakage avoidance Effectiveness Gains 98%+ touch-less processing 70% decrease in approval times Empowered with E-Invoicing “Nearly 80% of all incoming invoices are still paper based.” - The Hackett Group Receipt & Capture Receipt & Capture High cost of Paper Invoices “$4.6 million in contract leakage per billion in spend on average.” - The Hackett Group Matching & Approvals Matching & Approvals Lack of Compliance “15% of invoices have exceptions” - TAPN Inquiries & Exceptions Inquiries & Exceptions Too many Exceptions “80% of early payment discount opportunities missed.” - Ariba Discounts & Payments Discounts & Payments Lack of Control Capture 100% of your invoices in a digital format from any supplier regardless of volume, location or capabilities Resolve invoice errors at point of submission with self-serve supplier portal and over 80 Ariba Network business rules Match invoices against POs, contracts, service sheets. Workflow routing and approval Control payment timing and maximize early payment discount capture Eliminate & Digitize Paper Capture & Correct Exceptions Systemic Compliance Control Payment Timing Efficiency Gains 60 – 80% operational cost takeout in AP © 2015 Ariba – an SAP company. All rights reserved.5
- 6. #AribaLIVE @ariba#AribaLIVE @ariba Realizethe Business Case “1-for-1” Process Cost Containment $1M per $1B in spend process efficiency savings Discount Capture “2-for-1” $2M+ in discount savings for every $1B in discountable spend Working Capital “3-for-1” $2.7M in working capital impact per $1B per day of improvement in DPO, DSO, DIO Contract Compliance “4-for-1” $4M in savings leakage for every $1B in spend under contract $10+ Million Savings per $1 Billion Targeted Spend © 2015 Ariba – an SAP company. All rights reserved.6
- 7. Embrace the Powerof Networked E-Invoicing DISCOUNT MANAGEMENT WORKINGCAPITAL COMPLIANCE SUPPLIER MANAGEMENT PROCESSSAVINGS ELECTRONIC INVOICING SPENDANALYSIS
- 8. #AribaLIVE @ariba#AribaLIVE @ariba ©2015 Ariba – an SAP company. All rights reserved.8
- 9. #AribaLIVE @ariba#AribaLIVE @ariba Whatis Elsevier? • The Premier Scientific, Technical and Medical Information Provider 20,000+ books Over 2,000 journals per year Electronic databases © 2015 Ariba – an SAP company. All rights reserved.9
- 10. #AribaLIVE @ariba#AribaLIVE @ariba InvoiceAutomation Objectives • Reduce manual invoice processing Reduce reliance on scanning – OCR Reduce cost of manual invoice processing • Standardize invoice processing “streams” Indirect, services, book production, journal production • Improve opportunity to take advantage of early pay discounts © 2015 Ariba – an SAP company. All rights reserved.10
- 11. #AribaLIVE @ariba#AribaLIVE @ariba AribaE-Invoicing Program Overview • Oracle ERP system • Over 30,000 suppliers Spread across six continents and every time zone • Over 250,000 invoices annually Customized procurement processes for creative material Highly detailed manufacturing specifications unique per product Complex invoice flows and approval processes © 2015 Ariba – an SAP company. All rights reserved.11
- 12. #AribaLIVE @ariba#AribaLIVE @ariba AGlobal Program • Time Zones • Language • Currencies • Training • Support © 2015 Ariba – an SAP company. All rights reserved.12
- 13. #AribaLIVE @ariba#AribaLIVE @ariba UniqueChallenges of a Creative Environment • Each product is a custom item • Thousands of individual creative people • Standardization can be a challenge • Identifying the ordering systems and invoice flows Indirect Direct – Books, Journals, Electronic © 2015 Ariba – an SAP company. All rights reserved.13
- 14. #AribaLIVE @ariba#AribaLIVE @ariba Analyzingthe Procurement Channels • Standard POs for indirect spend © 2015 Ariba – an SAP company. All rights reserved.14 Purchase Orders Book Orders Journals Orders • Specialized ordering processes with unique custom requirements
- 15. #AribaLIVE @ariba#AribaLIVE @ariba PreparingSupplier Data • Categorizing suppliers by type (POs, books, journals) • Unique approach for each • Preparing the data Identifying the correct contact at each supplier Working with the supplier relationship manager Follow up, follow up, follow up Timing has to be right too © 2015 Ariba – an SAP company. All rights reserved.15
- 16. #AribaLIVE @ariba#AribaLIVE @ariba PO-Flip®with Ariba • Where purchase orders are available Primarily indirect spend 20% of orders and invoices Targeted large order/invoice volume suppliers first Thousands of small suppliers © 2015 Ariba – an SAP company. All rights reserved.16
- 17. #AribaLIVE @ariba#AribaLIVE @ariba JournalProduction • Custom ordering process flow Each journal, volume and issue a unique project Tracking of inputs and costs to the journal, volume and issue • Invoice process template for production Typesetting and printing invoices Training suppliers how to use the template and the data for each custom field were keys to success • Invoice approval process Each product unique approval flow © 2015 Ariba – an SAP company. All rights reserved.17
- 18. #AribaLIVE @ariba#AribaLIVE @ariba BookProduction • Custom ordering process Unique specifications for each project • Invoice template for producers Typesetters and Printers Training • Invoice approval process Large number of approvers Each product unique approval flow © 2015 Ariba – an SAP company. All rights reserved.18
- 19. #AribaLIVE @ariba#AribaLIVE @ariba ProductionInvoices Input • Integrated book or journal invoice suppliers cXML EDI CSV • Manual entry suppliers for both books and journals Books – ISBN and printing Journals – Journal number, Volume and Issue © 2015 Ariba – an SAP company. All rights reserved.19
- 20. #AribaLIVE @ariba#AribaLIVE @ariba •Highlighted items for each required data field • Bulleted instructions for required data in each field Manual Entry Guide © 2015 Ariba – an SAP company. All rights reserved.20
- 21. #AribaLIVE @ariba#AribaLIVE @ariba Summaryof Benefits • Driving to 99% on-time payment performance • Flexible invoice formats to accommodate all suppliers • Real-time invoice status for suppliers, eliminating calls to AP • Improved PO compliance • Reduced processing cost of invoices © 2015 Ariba – an SAP company. All rights reserved.21
- 22. #AribaLIVE @ariba#AribaLIVE @ariba LessonsLearned • Data preparation Cleaning supplier data Having the correct supplier contact • Communication Internal as well as external © 2015 Ariba – an SAP company. All rights reserved.22
- 23. #AribaLIVE @ariba#AribaLIVE @ariba NextSteps • Expanding the program to other divisions • Contract templates Link non-PO invoices to contracts to extend touchless processing • Expanding the suppliers involved • Expand early payment discounts Earn greater discounts to improve cash flow © 2015 Ariba – an SAP company. All rights reserved.23
- 24. #AribaLIVE @ariba#AribaLIVE @ariba Questions? •Ed Aderman e.aderman@reedelsevier.com © 2015 Ariba – an SAP company. All rights reserved.24