Posted by Mark Brousseau
It’s not often that an organization can reduce its workforce while significantly growing its volume, but that’s exactly what University Hospitals, one of the nation’s leading healthcare systems, did by rethinking and automating processes in its accounts payable (AP) shared services department.
The healthcare system’s shared services center has supported a 63 percent increase in invoice volume with a 17 percent reduction in full-time equivalents (FTEs), Jeff Lubbe, corporate finance director, University Hospitals, told attendees at Kofax Transform 2011 Americas this week in San Diego.
When University Hospitals set out to revamp its AP operations a few years back, several factors were driving its thinking: external pressure to improve profitability, its desire to reduce back-office costs and reinvest the savings in patient care, and its desire to improve satisfaction with AP processing. What’s more, the AP department’s old technology infrastructure presented several challenges:
• Lost and misplaced invoices
• High costs for non-value added tasks
• Lots of time focused on keying instead of analytics
• Lack of information for workload monitoring
• Lack of accountability to resolve problem invoices
• Difficult verifying non-PO invoice approvals
• Lag time to receive approval on non-PO invoices
• Issues around coding of invoices to invalid accounts
Against this backdrop, it’s not surprising that AP was blamed anytime an invoice was paid late.
With the implementation of an Oracle enterprise resource planning (ERP) system, University Hospitals felt it finally had a strong base that it could build on for its automation strategy.
The first phase of University Hospitals’ automation strategy was to consolidate its AP operations, consolidate invoices and suppliers, identify technology-ready suppliers with high invoice counts (“We wanted to see where we could use EDI [electronic data interchange] or spreadsheet uploads,” Lubbe said), and takea hard look at internally generated transactions for process improvements.
In the second phase of its AP automation strategy, Lubbe said University Hospitals implemented a document imaging and automated workflow solution, and began utilizing a self-service solution for expenses and non-PO invoicing. University Hospitals selected MarkView software from 170 Systems (now part of Kofax) for its document imaging and automated workflow solution.
“Our strategy was to select an Oracle application – since we are an Oracle shop – and if one didn’t exist, to select an Oracle partner that had a solution that was intuitive, cost effective and scalable,” Lubbe told attendees. “We chose 170 Systems because of MarkView’s integration with Oracle, the company’s proven track record of best-practices implementations, its extensive financial automation experience, and MarkView’s breadth of out-of-the-box functionality. It was a really great fit for us.”
Today, University Hospitals has automated about 75 percent of the invoices that come into its enterprise, Lubbe said. The final phase of the medical system’s original AP automation plan will include deploying an optical character recognition (OCR) solution, and refocusing AP staff on analytical tasks, such as problem and hold resolution, statement reconciliation, and discount capture.
To automate its data capture, University Hospitals began deploying Kofax Capture and Kofax Transformation Management in December, and expects to complete the implementation in March. Lubbe said the medical system selected the Kofax products because of their integration with MarkView and Kofax’s leadership position in the intelligent data capture market.
While data capture is sure to provide additional benefits, Lubbe said he’s already pleased with the progress the medical system has made in automating its AP processes. “We have improved internal control, improved productivity of the AP department and its manager, increased visibility, avoided AP headcount increases, and improved the perception of AP and finance,” Lubbe concluded.
Showing posts with label e-invoices. Show all posts
Showing posts with label e-invoices. Show all posts
Saturday, January 22, 2011
Monday, November 29, 2010
Electronic Invoicing: A Dog Chasing the Car
By Tom Walker of Open Text
What is electronic invoicing? Just a simple search of the Internet provides several answers. What is the correct way to write the term … spell it out or abbreviate with a big E or little e? Does this relate to outbound invoices or inbound invoices? Is this just electronic data interchange (EDI)? I ask for your comments based on my observation below; when you hear e-invoice…what comes to mind?
For my comments, I will use e-invoice and assume it relates to inbound invoices and I will assume that SAP is the backend solution.
Invoices can be received electronically through several methods. EDI has been around for many years and seemed to have reached its peak. Most major trading partners were EDI-enabled. EDI also requires a specific internal skill set to maintain. The maturity of EDI provides a proven electronic methodology but somewhat relegated to large corporations. Both large companies and small to mid size receive invoices through direct loads from vendor website and upload of files sent from vendors. The direct link to vendors is common with purchasing cards while files uploads are common with utilities.
The thing all of these electronic methods have in common is the elimination of mail room activity and manual data entry. Another commonality is that all may still contain errors in the invoice meta data. Some consider fax or email attachment as electronic but both of these typically require first capture of the image and from that point they are handled the same as paper invoices.
There is a current trend to consider electronic invoice presentment and payment (EIPP) to be e-invoicing as provided by vendor networks. These networks accumulate invoices (typically those invoices still received by paper) from multiple Vendors and then submit them to the respective multiple clients…a many to many relationship. While these networks continue to be unique to specific providers, it is assumed they will eventually provide the ability to “roam” similar to cell phone networks.
Regardless of how a corporation receives e-invoices, it is how you process the header and line item meta data that creates significant additional value to e-invoicing. Moving from paper to e-invoice does not eliminate the vendor from providing incorrect meta data. It does not remove the labor required to correct invoice meta data, to route for approval or to report on the overall end to end processing. It does not provide the necessary process control or audit trails.
SAP not only provides the vendor network capabilities through their Crossgate solution, they also provide SAP Invoice Management which is designed to work with all forms of e-invoice.
So, not unlike the dog chasing the car, it is what you do with it when you catch it that makes the story most interesting.
What do you think?
What is electronic invoicing? Just a simple search of the Internet provides several answers. What is the correct way to write the term … spell it out or abbreviate with a big E or little e? Does this relate to outbound invoices or inbound invoices? Is this just electronic data interchange (EDI)? I ask for your comments based on my observation below; when you hear e-invoice…what comes to mind?
For my comments, I will use e-invoice and assume it relates to inbound invoices and I will assume that SAP is the backend solution.
Invoices can be received electronically through several methods. EDI has been around for many years and seemed to have reached its peak. Most major trading partners were EDI-enabled. EDI also requires a specific internal skill set to maintain. The maturity of EDI provides a proven electronic methodology but somewhat relegated to large corporations. Both large companies and small to mid size receive invoices through direct loads from vendor website and upload of files sent from vendors. The direct link to vendors is common with purchasing cards while files uploads are common with utilities.
The thing all of these electronic methods have in common is the elimination of mail room activity and manual data entry. Another commonality is that all may still contain errors in the invoice meta data. Some consider fax or email attachment as electronic but both of these typically require first capture of the image and from that point they are handled the same as paper invoices.
There is a current trend to consider electronic invoice presentment and payment (EIPP) to be e-invoicing as provided by vendor networks. These networks accumulate invoices (typically those invoices still received by paper) from multiple Vendors and then submit them to the respective multiple clients…a many to many relationship. While these networks continue to be unique to specific providers, it is assumed they will eventually provide the ability to “roam” similar to cell phone networks.
Regardless of how a corporation receives e-invoices, it is how you process the header and line item meta data that creates significant additional value to e-invoicing. Moving from paper to e-invoice does not eliminate the vendor from providing incorrect meta data. It does not remove the labor required to correct invoice meta data, to route for approval or to report on the overall end to end processing. It does not provide the necessary process control or audit trails.
SAP not only provides the vendor network capabilities through their Crossgate solution, they also provide SAP Invoice Management which is designed to work with all forms of e-invoice.
So, not unlike the dog chasing the car, it is what you do with it when you catch it that makes the story most interesting.
What do you think?
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