AP CHANGE MAKER
KICKSTARTER PRESENTATION SLIDES
These presentation slides are designed as content for AP Change Makers building
their own internal presentations on the subject of Accounts Payable Automation.
The slides present market data, high-level business case inputs and examples of
best practice results achieved by those companies who have successfully
implemented AP Automation solutions.
If you have any questions about these slides or would like further information
please do not hesitate to get in touch.
These Kickstarter slides are part of a our broader toolkit for AP Change Makers,
which also includes:
RFP Guide:
Ensure you’re asking the right question to select the right partner
Check Lists:
Performance Calculator:
Top things to consider when initiating an AP Automation project
Coming soon – benchmark your AP performance against best-practice
DRIVING ACCOUNTS PAYABLE
PERFORMANCE
Name
Title
Date
ACCOUNTS PAYABLE IS CHANGING
THE ADOPTION OF AP AUTOMATION SOLUTIONS IS
DRIVING A SHIFT IN ACCOUNTS PAYABLE PERFORMANCE
Eliminating inefficient paper
based processes
Reducing the operational
cost of finance
Increasing productivity and
effectiveness
More predictable cashmanagement
Better supplier relationships /
access to early payment
discounts
Increasing accuracy and
control
AP PERFORMANCE BENCHMARKED
INDUSTRY ANALYSTS HAVE BENCHMARKED PERFORMANCE OF AP DEPARTMENTS GLOBALLY
AVERAGE PERFORMANCE KPIS
Source: Ardent Partners (2013)
THE BUSINESS OPPORTUNITY OF
BEST-IN-CLASS AP PERFORMANCE
LEADING COMPANIES HAVE MADE A STEPCHANGE
IN AP PERFORMANCE –AVERAGE PERFORMANCE vs. BEST-IN-CLASS PERFORMANCE
Source: Ardent Partners (2013)
WHAT ABOUT US?
HOW DOES OUR COMPANY MEASURE UP?
BENCHMARKS
INDUSTRY AVERAGE
BEST-IN-CLASS
<COMPANY
NAME>
Average cost to
process an invoice
$19.10
$2.20
#
Number of invoices
processed per FTE per
annum
25,452
42,708
#
Number (%) of invoices
processed straightthrough
18.4%
44.2%
#
Average time to
process an invoice
13.5 days
3.3 days
#
Invoice (%) exception
rate
16.1%
7.7%
#
Number (%) of invoices
paid on time
70.8%
91.4%
#
Source: Ardent Partners (2013)
THE BOTTOM LINE IMPACT OF
BEST-IN-CLASS AP PERFORMANCE
BY SIMPLY LOOKING AT THE COST OF PROCESSING
INVOICES, THE CASE FOR CHANGE IS COMPELLING
XK
invoices
$000K
WHO ARE THE AP LEADERS?
CHALLENGES
SOLUTIONS
RESULTS
• Siloed processing solutions and complex IT environment, including multiple ERP’s
• Paper based invoice handling & matching processes
• Complex account payable processes that included 430.000 purchase invoices per
year
• Implemented new Invoice Automation solution
• Integrated solution across multiple ERP middleware
•
•
•
•
Reduced headcount dedicated to A/P by 40%
Automated matching of over 90% of invoices
Reduced invoice handling cycle times
On-going $ savings through continuous process improvements
40% FTE reduction
90% touchless processing
AP Automation
Integrated with 5 ERPs
CHALLENGES
SOLUTIONS
RESULTS
•
•
•
•
Lack of visibility of financial operations across multiple ERPs
Costly and time-consuming manual invoice processing
Goal to achieve higher level of (AP) automation globally
Need to support solution rollouts within the global organization
• Implemented Invoice Automation solution
• Integrated solution across multiple ERP middleware
• Significant productivity increases, processing millions of invoices globally
• 60% fully automatic, straight-through processing of PO based invoices
• Greater visibility and efficient control of invoices
6 million
invoices
handled
60%
14
countries
touchless
processing
AP Automation
56% FTE
Reduction
CHALLENGES
SOLUTIONS
RESULTS
• Need to reduce costs and boost productivity of AP function
• Lack of financial process visibility across multiple ERPs
• Need to enable a Shared Service Center program
• Implemented AP Automation solution
• Consolidation of multiple processing locations to a single SSC
• Integration across multiple ERP middleware
• Reduced invoice cycle times by 75%
• Annual processing volumes of AP department increased from 10,000 to 40,000
invoices
• Overall cost savings with SSC program of £400,000 in the 1st year alone
4x more work with same
AP resources
75% shorter invoice cycle times
AP Automation
£400k
1st year savings
CHALLENGES
SOLUTIONS
RESULTS
•
•
•
•
High cost of time and effort in processing invoices
Issues with invoice tracking and auditability
Manual management of 450,000 invoices
Goal to streamline workflow and improve efficiencies across AP
• Implemented Invoice Automation solution
• Integrated solution across multiple ERP middleware
• Built in new workflow solution
•
•
•
•
Annual savings of $160,000 delivered by Invoice Automation
25% clerical staff reduction
Greater visibility and control over the 450,000 invoices processed annually
97% of invoices processed electronically
450k
invoices
25% FTE
reduction
$160k
97%
Annual savings
paperless
AP Automation
CHALLENGES
•
•
•
•
•
Over 2.5 million invoices processed per annum
<5% of invoices received electronically
Limited use of Purchase Orders
Manual data entry of invoice details
Manual control environment (e.g. checking of financial approvals)
SOLUTIONS
•
•
•
•
Automated procure-to-pay process solution
Implemented Invoice Automation solution
Integrated purchase management
Integrated contract lifecycle management
RESULTS
• 35% productivity improvement in Accounts Payable
• FTE savings target achieved
• Improved control environment & Payment Cycles (99.5% invoices processed w/
service levels)
• 12,000+ users now using the solution
• Processing 3,500 invoices and 300 POs daily
2.5 million
invoices
handled
35% AP
99.5%
efficiency gains
on-time payment
AP Automation
55% of invoices
received
electronically
d
HOW DO AP LEADERS ACHIEVE
BEST-IN-CLASS PERFORMANCE?
ACHIEVING BEST-IN-CLASS PERFORMANCE
BEST IN CLASS PERFORMERS SHARE COMMON CHARACTERISTICS
RELATED TO TECHNOLOGY USAGE
10%
Automated data capture & extraction
31%
17%
Supplier/B2B/payment network
38%
21%
E-invoicing solutions
45%
27%
Automatic routing & approval workflow
59%
52%
Document imagining/scanning
87%
All others
Source: Ardent Partners (2013)
Best-In-Class
E-INVOICING PLAYS A KEY ROLE
Average Cost Per Invoice
INCREASING THE NUMBER OF RECEIVED E-INVOICES DRIVES DOWN
THE COST OF INVOICE PROCESSING
$18.07
$10.55
$8.30
$6.08
% of Invoices Received Electronically
Source: Ardent Partners (2013)
WHICH TECHNOLOGY SOLUTIONS WILL
DRIVE OUR AP PERFORMANCE?
IMPACTING KPIs OF <COMPANY>
EXPERIENCES OF BiC PERFORMERS SHOW WHICH SOLUTIONS ARE THE
BIGGEST VALUE DRIVERS
IMPACTING KPIs OF <COMPANY>
EXPERIENCES OF BEST-IN-CLASS PERFORMERS SHOW WHICH SOLUTIONS
CAN IMPACT ON OUR KEY VALUE DRIVERS
•
•
•
•
•
•
•
•
•
•
XML, Virtual Printer
PDF/e-mail
CloudScan
Supplier Portal
Scan & Capture
Activation Services
Auto-validation
Only valid invoices
progress
Invalid invoices are
flagged
Supplier self-correction
•
•
Match-Orders
Match-Plans
•
•
•
•
•
Match-Orders
Match-Plans
Recipient resolvers
Smart Coding
Mobility
•
•
•
•
•
Recipient resolvers
Smart Coding
Mobility
Collaborate
Manual Matching
SUMMARY
HOW AP AUTOMATION WILL DRIVE OUR FINANCIAL PERFORMANCE
Full automation
Match-Orders
1st time match rates
Partial automation
Match-Plans
Invoices per FTE
Smart workflows/coding
Invoice cycle times
Collaborative tools
Recipient
Resolvers
Collaborate
Mobility
Mobile
Supplier portal
Portal
Days payable
outstanding
Cost per invoice
E-invoicing
100% e-Invoicing
E-invoice % by volume
Discounts captured