Few organizations would claim the processing of paper invoices as a best practice. Jeff Halper, director of procurement, Maxim Healthcare Services, falls into that camp.
As our featured speaker in this month’s webinar featuring best-practices in Collaborative Finance Management, Jeff laid out the challenge he faced when he set out to “achieve a 100% paperless invoice process.”
“Maxim is a growing company, but we did not have the right processes and controls in place,” Halper said. “Purchasing and payment were not connected. There was no formal process to control spend. Too much time and too many resources were spent manually coding invoices into the general ledger after expenses had already been incurred.”
Compounding the problem was a decentralized business structure, where managers at each of 425 offices in 46 states were responsible for their own P&L.
Jeff’s goal was to find a way to integrate the entire procure-to-pay process, where one system could manage vendor catalogs, purchase orders, invoices and payments. “We needed one place where we could go to buy and pay, and Ariba offered that one-stop solution,” he said.
Eliminating paper invoices was a big first step. With electronic invoicing, invoice errors are automatically detected upon submission, and returned to suppliers for correction before the AP department ever receives them. For PO-based spend, Maxim approves the PO before incurring the expense, and automatically matches the invoice with the PO before posting for payment. Halper calls that “the perfect transaction - no errors.”
In addition to an improved processes, Maxim now has visibility into line-level data that allows the healthcare services company to perform valuable spend analysis. This has contributed to new job descriptions for Maxim’s AP staff. “Instead of manually matching paper invoices, these resources provide value-add functions that identify ways for us to save even more money,” he said.
This includes expansion of early payment discounts, a major initiative in the next phase of Maxim’s procure-to-pay transformation.
How is your paperless invoice processing coming along. Look forward to hearing from you?
Global Director, Collaborative Finance Management