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Finance & Accounting

50 Posts authored by: Chris Rauen

How much time do you spend in accounts payable responding to supplier calls about invoice status? In his presentation at Ariba Live, Jeff Phillips of UPS mentioned that invoices would often disappear into the "big black hole of our ERP system." No one knew what was going on.

 

Today, UPS takes a smart invoicing approach, extending its ERP system with Ariba to collaborate with suppliers of all sizes for invoice processing. Suppliers don't call UPS about invoice status; they can see for themselves via a self-service portal. But that's not all. To hear about the other benefits of smart invoicing, for UPS and its suppliers, check out this video.

 

Ariba Live featured presentations from finance leaders at world-class organizations discussing how electronic invoicing with Ariba is helping to eliminate paper, invoice exceptions and supplier inquiries; lower processing costs; and manage cash better.

 

If you missed these presentations, you can hear interviews with these experts and others at: www.ariba.com/smartinvoicing.

 

If you would like to simply browse through all presentations that are available, you can find them here:  Ariba LIVE 2012

 

For other post-session Ariba Live interviews captured on video, you can visit our YouTube channel, where you will find the interviews, clips from main stage, and more. We will be updating and adding even more videos over the next two weeks.

 

If you attended Ariba Live, I'd love to hear from you. Let me know what sessions or programs you found most valuable, and what you would like to see in next year's event, to be held May 6-9 in Washington, D.C.

Hard to believe a week has passed since Ariba Live. The interest from everyone - buyers, suppliers, partners and others - about business commerce collaboration was evident throughout the conference.

 

With such a broad agenda, it was difficult for attendees to fit into their schedules all the sessions they wanted to attend. For those of you who may have missed the smart invoicing session, here is a link to the presentation. Geoff Brown from Liberty Mutual and Jeff Phillips from UPS discussed their invoice processing challenges, and the results they achieved by taking a smart invoicing approach.

 

For a complete list of Ariba Live presentations, click here.

Are you looking to move beyond scanning and optical character recognition (OCR) and eliminate paper invoices altogether? Provide your suppliers with a self-service portal that eliminates phone calls to AP? Capture all available early payment discounts, and generate new, dynamic discounts from suppliers that never offered them before?

 

These are just a few of the issues that will be discussed at Ariba Live, April 10-12,in Las Vegas. Join corporate finance leaders from GlaxoSmithKline, Liberty Mutual, UPS, The Walt Disney Company, ONEOK, and other world-class organizations as they discuss strategies and best practices for automating accounts payable. Network with your peers. Discuss business trends with industry analysts. Learn about the technology, community, and capabilities that are making business commerce as easy as consumer commerce.

 

For more information, or to register, visit www.aribalive.com

For top performing organizations such as GlaxoSmithKline, Liberty Mutual, UPS, The Walt Disney Company, Flint Hills Resources, and ONEOK, accounts payable is a strategic business function that is helping to manage cash better.

 

How did these organizations transform their AP function for business advantage?

 

You can hear their stories at Ariba Live, April 10-12 in Las Vegas. This is the premier event for corporate finance professionals looking to streamline accounts payable operations and optimize their working capital.

 

Here are some of the topics that will be featured in session presentations at Ariba Live:

 

  • How Smart Invoicing Enables Straight-Through Processing for All Your Suppliers
  • Winning Supplier Enablement Strategies
  • The Big Payoff: Top Payables Performance Metrics... and How To Achieve Them
  • Dynamic Discounting: New Opportunities for No-Risk, High Yield Cash Returns
  • The Collaboration Imperative: Extending Back Office Systems to Automate All Spend

 

For more information, or to register, visit www.aribalive.com

Join us at Ariba Live, April 10-12, Caesars Palace, and learn about smart invoicing, dynamic discounting, supplier enablement, payables performance measurement, and more, from finance leaders at Flint Hills Resources, Dollar Tree, UPS, Liberty Mutual, Republic Services, and GlaxoSmithKline to name a few.

 

If you are responsible for improving accounts payable performance, or would like to be, this is the one event you should attend this year.

 

To learn more, or to register, visit www.aribalive.com

AP professionals... you can help your company earn higher annual returns on cash than Warren Buffett. How? Through early payment discounts.

 

Don't take my word for it. Attend our webinar this Thursday, 2pm EDT - 11am PDT, featuring Republic Services, who will discuss how they are earning double-digit annual returns from early payment discounts.

 

For more information or to register, click here

On Thursday, March 15, at 2pm EDT - 11am PDT, Republic Services will discuss how it is expanding early payment discounts to earn double-digit, annual cash returns.

In this webinar, you will hear about strategies for managing cash that increase cash returns, risk-free, while maintaining or extending your Days Payable Outstanding (DPO). For anyone interested in how innovations such as dynamic discounting are changing the perception of accounts payable from the group that pays the bill to a trusted resource for managing cash, you'll want to catch this presentation.

For more information or to register, visit www.ariba.com/programs/invoicenow

In an earlier post on this topic, I asked, "What are your invoice volumes, and how many people do you have assigned to invoice processing? If you have moved from paper processing to an electronic process, what improvements are you seeing?"

 

For those looking to probe a little further as well as compare AP performance against your peers, I encourage you to visit this Aberdeen Group micro site. Here, you can walk through a performance benchmark and access research reports on a variety of topics relating to the accounts payable function.

 

Accounts payable performance benchmarking is also a featured session at Ariba Live, April 10-12, so there's another good reason you should plan to attend.

Any corporate finance professional driven to apply best practices within their organization would find no better venue than Ariba Live. Set for April 10-12 at Caesars Palace, you will find presentations on smart invoicing, dynamic discounting, supplier enablement, and payable performance measurement to name a few, and presenters from world-class organizations such as Flint Hills Resources, Dollar Tree, UPS, Liberty Mutual, Entergy, GlaxoSmithKline, and more.

 

While you know this is the place to be, your boss may not. So we've made it easy to justify the time away from the office so you can attend. Click here to access a memo that you can tailor to explain why you must attend.

 

Need more supporting documentation? How about this lineup of speakers. And valuable networking events.

 

Ariba Live is the one event to attend to learn strategies for buying smarter, selling faster, and managing your cash more effectively. I hope you can join us.

Several years ago, a common corporate finance objective was to get working capital metrics such as Days Payable Outstanding (DPO) and cash balances under control. Many have succeeded, but now these organizations face another dilemma: how to earn more than one percent on cash balances.

 

Within accounts payable, early payment discounts represent the next phase of an effective working capital management strategy. Organizations such as Republic Services are earning double-digit annual cash returns from these discounts, while helping their suppliers get access to valuable cash. You can achieve these results, too.

 

To learn how Republic Services is managing cash better, join us for our March 15, webinar, 2pm EST. For more information and to register, click here

Invoice processing productivity depends upon several variables. One important factor is the level of automation in accounts payable.

 

Based upon our experiences working with customers to improve their invoice processes, an organization that is manually processing paper invoices can expect AP staff members to process about 14,000 invoices per year. Much of their time is spent resolving invoice errors or responding to calls from suppliers asking when they will get paid. Contrast that with the AP organization processing electronic invoices. According to our data, productivity soars to 85,000 invoices per year per FTE. Little time is wasted on fixing problem invoices or responding to supplier inquiries.

 

When you project these numbers for a large organization faced with the processing of 500,000 invoices a year, the paper pushers require an AP staff of 35+ compared to 5-6 people to manage an e-invoicing operation.

 

While few organizations are processing 100 percent of invoices electronically, the gap in process efficiency and cost discrepancies are startling. And this doesn't take into account the costs from rogue spend or missed discounts.

 

I'd like to hear from AP managers how your organizations ranks on the invoice processing productivity scale. What are your invoice volumes, and how many people do you have assigned to invoice processing? If you have moved from paper processing to an electronic process, what improvements are you seeing? 

Scanning and Optical Character Recognition (OCR) technologies are sometimes considered a first step in automating the processing of invoices. But these approaches continue to rely on the submission of a paper invoice.

 

There is much more to invoice processing than digitizing a paper invoice. The ability to ensure that the invoice is from a preferred supplier, and contains the right price, is critical. There's also the issue of supplier inquiries, which can overwhelm a lean AP staff and prevent them from engaging in higher-value activities such as managing supplier performance and pursuring early payment discount opportunities.

 

A recently published report from The Accounts Payable Network talks about a different approach to invoice processing: the smart invoice network. The report examines the current state of accounts payable, alternate invoice automation approaches such as EDI and OCR, and the value to buyers and supplier of collaborating over a smart invoice network.

 

To access a free copy of the report, click here

Growing up, I shared a room with my younger brother. As I would attempt to mind my own business, he would join in and before long... mayhem. Our father, as referee, would fly into our room to break us apart. I would get most of the blame for starting  the ruckus.

 

Processing an invoice can be as chaotic. With so many things that can go wrong, it's no surprise that on-time payment performance often fails to meet expectations. And AP usually takes the blame for late payments. As a recently published report from The Accounts Payable Network explains, however, the problem often lies outside of AP. Here's an excerpt:

 

"In an attempt to gain control over the ad-hoc purchasing process, many AP departments implemented an imaging and workflow system. Imaging and workflow make the invoice visible by 'automating the mailroom,' but AP still has to figure out who bought the product, and then electronically request all the documentation necessary to ensure product receipt, payment approval, proper GL booking and compliance with laws and tax regulations."

 

"From an AP cost perspective, the improvements have not had a real impact on invoice exceptions or inquiries, which is where 70 percent of AP costs reside."

 

The report, Beyond EDI: How a Smart Invoice Network Reorders P2P to Drive Global e-Invoicing and Collaboration with All Suppliers, contains valuable information about how to achieve real cost savings and business process improvement in accounts payable. To download your free copy, click here.

Chris Rauen

Episode 3: All My Invoices

Posted by Chris Rauen Jan 26, 2012

The Buyer and the Supplier, The Cash Rich and Cash Poor, On Time and Past Due, With or Without Payment Terms, In Boom Times and During Recessions, You have to PROCESS YOUR INVOICES.

 

When Bert Zerk arrived in Rickie Crane’s office, he was caught by surprise. Rickie was gazing into space, with a troubled look on her face. “Are you OK?” he asked her.

 

Without answering or even looking at Zerk, she tossed him the memo from Allie Greenspan. “Read this,” she said. Zerk did, and when he was done, he looked back at Rickie and said, “Looks like we’re moving in a new direction.”

 

“Do you know what this means?” she responded, and only then turned her gaze to Zerk. “It could unravel everything we’ve done to improve accounts payable.”

 

The effort began with the scanning of paper invoices, and continued with an investment in OCR technology to capture data from invoices for processing. It was an investment that Crane considered vital to improving invoice processing performance. Without Zerk, though, it would have failed miserably. He was the technical expert and only person on her team that could master the OCR data transformation. He hadn’t had a vacation since the system went into production.

 

“We have to sabotage his plan,” she continued.

 

“What?” said Zerk. Now he was turning pale.

 

Without skipping a beat, Crane added, “Here’s what I have in mind.”

 

(What does Rickie Crane have in mind? If you have a good idea, post it here. I could use one for the next episode.)

 

(Miss the first two episodes? Click on a link for Episode 1 and Episode 2)

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