Touch Free Accounts Payable Processing
Pre Payment Accounts Payable outsourcing
Case Study
Client ~ A large Canadian manufacturing company processing approximately 10,000 accounts payable invoices per month. Not all of the accounts payable department is centralized meaning that some invoices are being couriered from remote offices to head office. As well due to the nature of their business not all goods and services are issued through the PO system and many invoices require several layers of management approvals.
Problem ~ The seven person accounts payable department could not keep up with demands by internal managers for retrieval of information and by outside vendors for payment information. Due to the manual nature of their approval processes, invoices would take an average of 35 days to be processed and approved. Often invoices would go missing or would be delayed due to managers being away. The accounts payable department spent more than 50% of their time tracking down invoices internally and responding to vendor inquires. Added to that, the paper storage and retrieval problems were only getting worse and, at the same time, management were under pressure to ensure invoices were being thoroughly verified prior to approval and that any available vendor discounts were being realized.
Opportunity ~ The opportunity to utilize technology to eliminate manual paper processes, eliminate manual entry of invoice details and to be able to electronically route and approve invoices was where the company wanted to be. The realization that technology could drastically reduce costs and improve efficiently was something worth exploring. The company AP manager conducted a search for the type of technology that would provide the solutions and benefits they were looking to achieve.
Deliverables ~ In the spring of 2008, Octacom was awarded the contract for their Touch Free Accounts Payable service which would provide a complete outsourcing solution for all of the accounts payable processes including daily processing of vendor invoices at Octacom’s processing center, capture and upload of invoices header and detail information to their SAP system. A completely integrated and custom tailored workflow solution for invoice routing and approvals which included a full suite of reporting and on-line verification tools for both AP workers and department managers. Vendor invoices are managed through mail, fax, email and image and the average time for invoice processing is 48 hours.
Benefits ~
- Much faster turnaround time for processing invoices
- 100% electronic access for all vendor invoices through workflow approval process and post payment, including the 7 year archival requirements
- Big improvements in the quality and reliability of data captured and processed
- Fully integrated within their SAP environment
- Decreased personnel costs
- No more lost or misfiled invoices
- Improved vendor relations and the ability to take advantage of all available discounts