May 7-9, 2017 Disney s Yacht & Beach Club Resorts, Florida. How to Know if You re Prepared for Full AP Automaton

Transcription

1 May 7-9, 2017 Disney s Yacht & Beach Club Resorts, Florida How to Know if You re Prepared for Full AP Automaton

2 Who Are We? Jess Scheer Continuing Education Manager, IOFM Chris Carberry Senior Director Product Management

3 Who Are You? What Best Describes Your Current State of Automation? We have no automation today We have some automation today. (Scanning, ACH payments) We re considering additional automation. What s Stopping You From Fully Automating? Budget and/or leadership commitment Burned by prior unsuccessful IT investments Fear of the financial investment (ROI) changing the process what we don t know

4 Five Best Practices For Automation Preparedness Strategic Alignment Ownership & Accountability Process Visualization Measurement & Controls Change Management Identification and selection of enterprise s best interest Clear and consistentlydefined roles & responsibilities Frameworks and models of the entire endto-end process Measurement system to track progress and consequences Communication and training plan for rollout and beyond

5 Two Worst Practice Stories

6 Where Did They Go Wrong? Strategic Alignment Ownership & Accountability Process Visualization Measurement & Controls Change Management Siloed functions prevent successful enterprise adoption A single endto-end process owner would have identified issues faster Seeing the whole process would have changed approach and results Companies only tracked intended results, not unintended consequences Breakdown between Sales and Finance doomed the company

7 Strategic Alignment Key Questions: Why Are You Automating Procure to Pay? What are the primary objectives? Don t just ask AP Would Procurement have the same answer? Would the Controller have the same answer? Would the CFO have the same answer Would the Chief Compliance Officer have the same answer? If not, where s the disconnect?

8 Ownership & Accountability Key Questions: Who Owns P2P? Who Will Own the Automation Integration, Rollout and Management? And, what does it meant to be the owner? Don t just ask AP Would Procurement have the same answer? Would the Controller have the same answer? Would the CFO have the same answer Would the Chief Compliance Officer have the same answer? If not, where s the disconnect?

9 Process Visualization Key Questions: Is everyone on the same page in defining the steps of the process? Can you see the entire P2P process? Do you know who is responsible and accountable for each step of the process? Where are the knowledge gaps in the process? And do they need to be filled before proceeding? Don t just ask AP Would Procurement have the same answer? Would the Controller have the same answer? Would the CFO have the same answer Would the Chief Compliance Officer have the same answer? If not, where s the disconnect?

10 Measurement & Controls Key Questions: Do you know what to measure? Do you know what activities align to the strategic goal of automation? Do you know what measures will best help you manage those activities? Do you know who will own the measures? Do you know who will define the measures, collect the data, store the data, etc.? Do you know what controls will monitor progress and unintended consequences? Don t just ask AP Would Procurement have the same answer? Would the Controller have the same answer? Would the CFO have the same answer Would the Chief Compliance Officer have the same answer? If not, where s the disconnect?

11 Change Management Key Questions: How will the change be communicated; how will the communication be tailored? Based on the knowledge gaps, what training is necessary? Who will own ongoing communication and training process HR or AP or Procurement? Don t just ask AP Would Procurement have the same answer? Would the Controller have the same answer? Would the CFO have the same answer Would the Chief Compliance Officer have the same answer? If not, where s the disconnect?

12 Are You Prepared? The future of AP is pointing toward greater automation to meet: Today s Needs Higher efficiency (lower costs) Higher effectiveness (higher quality) Tomorrow s Needs Risk identification and mitigation (OFAC, unclaimed property, etc.) Cash management and forecasting (extended credit terms) Support of procurement and the broader business (claims processing)

13 Are You Prepared? The future of AP is pointing toward greater automation to meet: Today s Needs Higher efficiency (lower costs) Higher effectiveness (higher quality) Tomorrow s Needs Risk identification and mitigation (OFAC, unclaimed property, etc.) Cash management and forecasting (extended credit terms) Support of procurement and the broader business (claims processing)

14 Case Study: Siemens Global Shared Services North America Electronic Invoicing Journey Siemens Business Unit Divisions Invoices Processed (annually) 1.4 million 1.8+ million Global Supplier Base 63, ,000+ Siemens Shared Services AP Headcount 50% Fewer FTEs (Enabling reallocation of half the team to higher value-added work)

15 Case Study: The What and How Objectives Reduce AP s cost and improve quality Exceed Siemens 22% G&A cost reduction target for AP within one year. Goals 80% electronic receipt of invoices 95% e-vouchering / posting rate of an electronic invoice Strategies Aggressively targeted high-volume suppliers (6% of vendors accounts for 79% of invoices) Targeted problematic, poor quality paper invoice suppliers Established a Vendor Adoption Committee with representatives from all business units Changed the Bill To Address on the PO to reflect the electronic submission method Established and promoted e-invoicing as the way of doing business with Siemens Provided procurement groups with standard communication and quick training guides for suppliers Required by contract in Terms and Conditions that all new vendors submit invoices electronically

16 Case Study: PayBox s Role No more paper All invoices converted to one standard Suppliers 100,000+ PAYBOX Solution 16+ ERPs Workflow Paper Vendor Self Service Inquiry Invoices 50 Companies Companies Business Units SAP SAP SAP New PO/PO Change EZ-AP Vendor Invoice Data Store Validation, Increased evoucher success rate Direct integration Scan for Paper invoices Web Entry, PO Flip & Spreadsheet Invoices Direct Integration Invoices (EDI or XML) Invoice

17 Case Study: Lessons Learned Internal Support Procurement support is crucial to adopt and sell e-invoicing Executive Sponsorship is necessary at business units level in Shared Services Encourage e-invoicing mandate or define criteria for e-invoicing process before go live with internal departments Supplier On-boarding Accurate contact information is key for recruiting suppliers Target 3 types: high volume, high dollar value, and traditional problematic suppliers Training & Support must be available, including on demand Prepare quick guides using screen prints Realize that behavior change is hard Make service free to suppliers Sell tool to suppliers explain benefits Allow different methods of electronic invoice submission Ensure dedicated helpdesk and set expectations on supplier support Self registration to e-invoicing portal for suppliers is critical Straight Through Touchless Processing Updated PO data must be available in the portal to enable PO flip E-invoice with bad information is almost as bad as a paper invoice Encourage PO flip Establish P2P end to end true EDI process if possible Ensure up to date vendor master data to ensure match with vendor

18 Objectives Case Study: The What and How Reduce AP s cost and improve quality Exceed Siemens 22% G&A cost reduction target for AP within one year. Goals 80% electronic receipt of invoices 95% e-vouchering / posting rate of an electronic invoice Strategies Aggressively targeted high-volume suppliers (6% of vendors accounts for 79% of invoices) Targeted problematic, poor quality paper invoice suppliers Established a Vendor Adoption Committee with representatives from all business units Changed the Bill To Address on the PO to reflect the electronic submission method Established and promoted e-invoicing as the way of doing business with Siemens Provided procurement groups with standard communication and quick training guides for suppliers Required by contract in Terms and Conditions that all new vendors submit invoices electronically

19 Case Study: What s Next? Customer Service AP Inquiries / Year Increase and improve Web AP Inquiry No more s & fewer phone calls All inquiries must submit through web portal: External/Supplier Inquiries Internal/Employee Inquiries Global Vendor on Boarding Portal Data input from Supplier Reduction in manual effort Improved data accuracy Quicker PO placement Reduced payment errors Central repository of Supplier data 80,000 60,000 40,000 20,000 0 Inquiries by Calls Inquiries by s IOL Web Inquiries Total Inquiries IOL Website Hits Sept 09 Sept 10 Sept 11 Sept 12 Sept 13 Sept 14 Sept 15 Sept 09 Sept 10 Sept 11 Sept 12 Sept 13 Sept 14 Sept 15 Invoice Submission Up front invoice validation Inquiries by Calls 7,260 4,458 2,312 2,411 1,854 1,338 1,477 Inquiries by s 24,510 10, , Early Payment Discounts Projects in place to increase supplier ability to take early payment discounts IOL Web Inquiries 1,664 6,209 5,102 4,345 4,647 5,296 Total Inquiries 31,770 16,447 9,420 8,556 6,960 6,286 7,270 IOL Website Hits 39,796 53,599 74,488 75,858 76,144 75,199 74,791 19

20 Case Study: Examples of Siemens s Automaton Preparedness Strategic Alignment Ownership & Accountability Process Visualization Measurement & Controls Change Management Example KPIs Lesson Learned: Number of Invoices Number of invoices submitted electronically Number of invoices processed electronically from start to finish Each business unit that joined the AP Shared Service group was offered on-demand training and support 20

21 Questions? Jess Scheer Continuing Education Manager, IOFM Robert Gilbert VP of Sales