Connecting efficiently with customers can make or break your success as a seller. But in today’s global economy, that’s not always so easy. Managing orders, invoices, and other processes across diverse systems, data formats, and geographies can be very challenging, especially if you’re a small or midsized seller. Sure, the right technologies can help solve the problem—but which strategies will work best for your company?
Automating your back end is an obvious first step, one most small sellers can afford. And joining open, global B2B platforms like the Ariba® Network gives you a many-to-many way to transact with multiple customers and grow your business.
Yet the best results come from integrating the two—helping you supercharge your e-commerce efficiency with touchless transacting so you can compete effectively with even much larger organizations. And thanks to a recent collaborative effort spearheaded by a small seller, now there’s a great new integration option available. Here’s how it happened and what it means for you.
The first step: Automating for efficiency
For TIPS, a small company based in Austria that develops highly reliable, customized microchip testing solutions for corporate customers worldwide, the adoption of SAP Business One™ has proven vital in supporting the company’s rapid growth. A complete ERP system designed to help small to midsized companies maximize back-end efficiency, SAP Business One offers a cost-effective way to automate management of sales, warehousing and production, inventory, purchasing, financials, customer service, human resources, and other core business functions (see sidebar).
After more than a decade of use, TIPS had streamlined its processes significantly through SAP Business One. For example, the company was able to quickly generate accurate orders, goods receipts, and paper invoices by “flipping” them directly from sales quotes—which, due to the non-standard, specialized nature of TIPS products, were extremely detailed and complex—and easily comply with the diverse tax and legal requirements involved in billing and shipping to an international client base.
Meeting challenge with innovation
So when one of its largest customers decided to move to paperless accounting and requested that TIPS start billing them through the Ariba Network, the company was in a quandary. The options initially presented for TIPS—to submit the customer’s 100+ invoices per month through the Ariba Network web portal, or upload them to the Ariba Network in batches via CSV or cXML—all required manual data conversion or even re-entry of invoice data, a time-consuming task that TIPS was understandably reluctant to take on. While this would reduce costs and add payment efficiency for the customer, it seemed a step backwards for TIPS, adding an extra layer of work to their current paper-based process supported by SAP Business One.
Determined to find a better approach, TIPS approached SAP and Ariba and asked: Could we integrate our SAP Business One application to the Ariba Network directly, enabling straight-through electronic processing of invoices for our customer? The answer was yes—if they were willing to help pioneer a unique pilot project to make integration possible not only for TIPS, but other sellers as well. Eager to meet its customer’s needs, TIPS agreed, and the team effort began.
Collaborating for mutual benefit
The strong commitment to success shared by TIPS, its customer, SAP, and Ariba proved instrumental in making the integration work. Biweekly meetings hosted by Ariba kept all players in touch and on track.
A task list of clear responsibilities and deadlines helped the team achieve specific milestones, including:
- Upgrading TIPS to a more current version of SAP Business One
- Enabling the SAP Integration Framework to connect the TIPS instance of SAP Business One to the customer’s ERP system through the Ariba Network
- Helping the customer define and update their invoicing requirements and processes in Ariba, then mapping them to the SAP Integration Framework
- Creating a playsheet to capture the necessary inputs and requirements, making the process easily repeatable for future sellers wishing to integrate
- Leveraging lessons learned by exchanging wins and best practices with participants in a concurrent SAP Business One/Ariba integration pilot
After final testing and installation, go-live was successfully achieved in December 2013.
Reaping the benefits: Efficiency, transparency, and speedy payment
The integration has transformed efficiency for both TIPS and their customer, making previously manual processes truly touchless. “During the sales process, we can now automatically check our delivery notes against the customer´s purchase orders to ensure that the ship-to address, shipment terms, tax requirements, payment terms, and similar details are accurate,” says Michael Hrobath, general manager of purchasing for TIPS. “After that, the invoice is a simple ‘copy-to’ job—only one checkbox has to be activated for transmission to Ariba.” Invoices go directly from SAP Business One to the customer’s ERP through the Ariba Network, eliminating the effort and expense required to print and mail paper bills or track down lost invoices. The need to double-check delivery notes and POs is gone as well, saving TIPS about five hours a week.
The overall ease and speed of the process have led TIPS to shift from weekly invoicing to immediate invoicing, sometimes only seconds after generating delivery notes. And since the customer’s three-point invoice validation process also occurs electronically, cycle times have plummeted, resulting in significantly faster payments for TIPS.
Just as important, clear visibility into invoice status via the Ariba Network portal tells TIPS what’s happening with each invoice—whether it’s been received, approved, or is still in process—and exactly when they’ll get paid. This not only lessens dunning work, but dramatically improves the company’s ability to monitor and manage working capital. The result? A smoother, steadier income stream that helps TIPS better allocate its budget and organize projects more efficiently.
Because of these good experiences, TIPS has extended invoicing over the Ariba Network to other entities and customers. “We now manage about 60% of our invoices over Ariba,” says Michael, noting that this has boosted savings and efficiency even higher.
The mouse that roars: Helping small sellers deliver world-class e-commerce
The new integration package makes it simple for any seller using SAP Business One to integrate with customers through the Ariba Network—enabling the touchless transacting that can take your collaborative commerce capabilities to a world-class level. In addition to invoicing, invoice status, remittance advice, and credit notes, the integration package supports fully automatic processing for purchase orders, order confirmations, and advance ship notices, with support for RFQs and quotes currently being developed.
For additional information on how SAP Business One works and the benefits it provides, go to the SAP Business One website. For questions about the new integration package, check out this overview or contact Domnic Savio Benedict at SAP SE (email@example.com).