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Touching your invoices? You don’t need to. 14 'how to’s' to touchless processing

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Why are we still touching invoices? Other companies aren’t so why are we? James Copeland from BMC software will talk about the 14 'how to’s' that have taken BMC from multiple touchpoints to touchless.

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Touching your invoices? You don’t need to. 14 'how to’s' to touchless processing

  1. 1. Touching your invoices? Youdon’t need to. 14 ‘how to’s’ totouchless processingJames CopelandVP FSSC BMC Software Inc.
  2. 2. Agenda BMC SSC at BMC Change of process The problem Invoices on hold First pass yield Results to date Questions?© Copyright 11/7/2012 BMC Software, Inc 2
  3. 3. BMC by the numbers Founded in 1980, 8th largest independent software company with over $2.0 billion in total bookings and revenue (Fiscal Year March 2012) Corporate headquarters in Houston, with more than 6,000 employees around the world IT needs to be structured, managed, staffed and deployed as a service – a service that business leaders can leverage to achieve their goals and objectives - That’s exactly what we do. We serve - 15,000 customers in 132 countries - Fortune 100: 94% - Fortune 500: 81% - Forbes Global 100: 96% - Forbes Global 500: 86%© Copyright 11/7/2012 BMC Software, Inc 3
  4. 4. Shared services profile IT - Classic IT role FSS CI - Customer-facing role - R&D-facing role OM IT People by Key business processes function - Order management (OM) - Global procurement (GP) GP - Financial shared services (FSS) Corporate initiatives (CI) - Process improvement Europe - Cross departmental initiatives Asia Pacific People - 789 employees Israel People by - 36 offices Americas region - 23 countries India© Copyright 11/7/2012 BMC Software, Inc 4
  5. 5. Financial Shared Services profile FSSC - Pune FSSC – Houston - Global accounts payable  Invoices (TTM) 116k Revenue accounting – Manual inv (TTM) 58k (50%) - Staff 4 iExpense (TTM) 72k  Professional services accounting  39 countries - Staff 4 (Houston)  Staff 19  1 (Amsterdam) - Global fixed assets  1 (Pune)  32 countries  Staff 3 Capitalized software accounting - General ledger - Staff 7  EMEA region Key financial applications – 25 countries - Oracle11i single WW instance – Staff 10  Single chart of accounts - Cash application EMEA & APAC - Hyperion HFM and planning  Staff 2 - BlackLine account reconciliation - India statutory accounting - IT2 treasury system  Staff 5© Copyright 11/7/2012 BMC Software, Inc 5
  6. 6. Get control of your processes – roles &responsibilities CFO Legal HR BU 1 BU 2 BU 3 Operations CAO Sales IS&T FPA Mktg Order Mgmt Tax R&D GP Back Office Treasury FPA Accounting Risk Mgmt Acctg Moved FPA to the BU’s. Moved Back Office Accounting to Business Ops.© Copyright 11/7/2012 BMC Software, Inc 6
  7. 7. Objective Reduce Touch - Best case – don’t touch the invoice  Current scenario – 30,000 invoices per quarter » 15,000 are manual Increase P2P first pass invoice yield (target > 90%) - If we have to touch it – we only want to do it once© Copyright 11/7/2012 BMC Software, Inc 7
  8. 8. Symptoms of the problem Historical trend of invoices on hold600500400300200100 0 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul 09 09 09 09 09 09 09 09 09 10 10 10 10 10 10 10 10 10 10 10 10 11 11 11 11 11 11 11 © Copyright 11/7/2012 BMC Software, Inc 8
  9. 9. Increase FPY • 1 - Train procurement, facilities and other key users • 2 - Restrict WebReq access to “Superusers” • 3 - Notify suppliers that “No PO - No Payment” is our policy • 4 - Implement the Oracle iSupplier Portal • 5 - Adopt/Require “Tiered Routing” globally for all categories • 6 - Auto close for aged PO’s • 7 - Issue Weekly Report that shows violators of “No/Late” PO policy • 8 - Ensure procurement professionals are NOT entering their own name on ANY Oracle WebReqs – that is, ALWAYS enter the name of the actual requisitioner • 9 - Revise process/procedure on 2-3 way match PO’s and communicate/train users© Copyright 11/7/2012 BMC Software, Inc 9
  10. 10. Decrease touch • 10 - Develop & implement a systemic solution to the “Fieldglass Receipt” issue • 11 - Evaluate alternative front end AP process • 12 - Implement Kofax scanning improvements • 13 - Formal plan/approach to accelerate the rate of catalogue integration outside of the USA • 14 - Need formal plan and execute a “Supplemental P-Card (MC or VISA) in large International Countries© Copyright 11/7/2012 BMC Software, Inc 10
  11. 11. Results to Date
  12. 12. Historical trend – all regions and total Year over year decrease – 76% From December High – down 83% The holds problem was primarily Region Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 APAC 7 2 0 6 4 India, EMEA and North America. ISREAL 7 9 2 9 8 Significant improvement in North INDIA 31 12 8 4 6 EMEA 29 39 29 60 7 America. LAM 0 4 0 7 1 NA 80 85 97 126 11 Total 154 151 136 212 37 © Copyright 11/7/2012 BMC Software, Inc INTERNAL USE ONLY © Copyright 11/7/2012 BMC Software, 1212 Inc.
  13. 13. North America Region 81% drop in holds for the quarter. No expense reports on hold. This was during Q4, a high volume invoice and expense report period. For North America (US + Canada) total 11 invoices amounting to $65K are on Hold. No invoices for US/ CA are above 30 days hold. Specifics for North America (7 invoices) 2 No PO 4 Insufficient funds on PO 1 No receipt There are no expense claims on hold © Copyright 11/7/2012 BMC Software, Inc INTERNAL USE ONLY © Copyright 11/7/2012 BMC Software, 1313 Inc.
  14. 14. North America – Process Control Chart Green Line is the average Red Lines are the UCL and LCL - Set 3 standard deviations from the mean Data points outside the red lines indicate something outside the norm has happened - Only 5% chance that this was a random event 1st Time Pass Rate for this Week is 89.08 %, Average for END of FY12Q4 84.34 %. © Copyright 11/7/2012 BMC Software, Inc INTERNAL USE ONLY © Copyright 11/7/2012 BMC Software, 1414 Inc.
  15. 15. North America – Invoices on hold greater than 30 days 30 •Objective was to eliminate any holds 25 greater than 30 What Changed? days 20 •No excuses weekly video conference 15 with the P2P team •Deep dive in all 10 older invoices •Pick up the phone 5 0 24/10/2011 24/11/2011 24/12/2011 24/01/2012 24/02/2012 24/03/2012 © Copyright 11/7/2012 BMC Software, Inc INTERNAL USE ONLY © Copyright 11/7/2012 BMC Software, 1515 Inc.
  16. 16. Identification of offenders - suppliers Top 3 Reasons Invoices went on Hold this week: Receipting not PO’s short of No PO / Invalid done funds PO on invoices Grand Total 11 4 33 Hold % age 22 % 8% 65 % Top 7 Vendors Contributing 57 % of the Issues: % age against Invalid PO on Receipting not PO’s short of 1st time pass % Age against VENDOR_NAME Total holds Grand Total total invoices invoices done funds invoice total holds of same vendor Vendor 1 15 15 3 18 29% 83% Vendor 2 3 3 10 13 6% 23% Vendor 3 3 3 3 6% 100% Vendor 4 1 1 2 1 3 4% 67% Vendor 5 2 2 2 4% 100% Vendor 6 2 2 2 4% 100% Vendor 7 2 2 2 4% 100% Total 23 6 0 29 14 43 © Copyright 11/7/2012 BMC Software, Inc INTERNAL USE ONLY © Copyright 11/7/2012 BMC Software, 1616 Inc.
  17. 17. Identification of offenders - employees Top 10 People: who are contributing 27 % of the holds % age against 1st time % Age Invalid PO on Receipting PO’s short of Grand total MIN_REQUESTER Department Total holds pass against invoices not done funds Total invoices of invoice total holds same vendor 5011-10010-PUBLIC Employee Name 3 3 3 6 6% 50% RELATIONS 5011-60009-AMERICAS CS - Employee Name 2 2 3 5 4% 40% GEO 5011-40649-IS AND T - Employee Name ENTERPRISE PLATFORM 2 2 2 4% 100% SVCS AG 5011-60009-AMERICAS CS - Employee Name 1 1 15 16 2% 6% GEO 5011-40012-GLOBAL Employee Name 1 1 9 10 2% 10% CORPORATE SERVICES CC Employee Name 5011-40089-IS AND T - PMO 1 1 1 2% 100% 5011-40012-GLOBAL Employee Name 1 1 2 3 2% 33% CORPORATE SERVICES CC 5011-40649-IS AND T - Employee Name ENTERPRISE PLATFORM 1 1 1 2% 100% SVCS AG 5011-40650-IS AND T - Employee Name 1 1 4 5 2% 20% CUSTOMER OPERATIONS 5011-40254-WW OEM Employee Name 1 1 1 2 2% 50% ROYALTIES Total 4 9 1 14 37 51 © Copyright 11/7/2012 BMC Software, Inc INTERNAL USE ONLY © Copyright 11/7/2012 BMC Software, 1717 Inc.
  18. 18. Assess your metrics weekly Week Week Week Week Week Week Week Week Week Week 29 05 12 19 26 04 11 18 25 01 Measurement details Jan Feb Feb Feb Feb Mar Mar Mar Mar Apr Invoice Volumes 262 435 422 567 341 538 329 471 288 467 82.06 79.08 83.41 82.19 83.28 87.83 84.50 85.99 84.72 89.08 1st Time Pass Rate % % % % % % % % % % Cycle Time (Avg./ St Dev) Days – Invoice went on Hold to Hold 8& 10 & 13 & 17 & 21 & 7& 15 & 9& 12 & 15 & resolved date 11 14 26 32 36 10 16 11 10 21 Total Hold Invoices Received in Week 47 91 70 101 57 87 51 66 44 51 Total Holds Resolved 56 63 105 65 97 56 80 92 69 61 58 & 72 & 73 & 84 & 57 & 86 & 65 & 79 & 84 & 66 & PO Vs Non PO (%) 42 28 27 16 43 14 35 21 16 34 © Copyright 11/7/2012 BMC Software, Inc INTERNAL USE ONLY © Copyright 11/7/2012 BMC Software, 1818 Inc.
  19. 19. First Pass Yield 92% 90% 90% Objective is 90% FPY for FY13 88% 87% 86% 86% 86% 85% 84% 83% 82% 82% 81% 80% 78% 76% Q1 FY12 Q2 FY12 Q3 FY12 Q4 FY12 Q1 FY13 Q2 FY13 Q3 FY13 Q4 FY13 Actual Plan Assuming 5,000 manual invoices Per month, we will need to eliminate: From our low of 81% - need to eliminate 450 exceptions per month From our year end metric of 86% - we need to eliminate 200 exceptions per month© Copyright 11/7/2012 BMC Software, Inc 19
  20. 20. Closing thoughts Single largest contributing factor to success No PO No Pay Employee contact© Copyright 11/7/2012 BMC Software, Inc 20
  21. 21. Questions?
  22. 22. Learn more at www.bmc.com© Copyright 11/7/2012 BMC Software, Inc 22

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