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www.esker.com
Esker DeliveryWare White Paper
Best-Practice Accounts Payable
Automation for SAP® Solutions
Table of contents
Introduction § . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Conventional accounts payable with SAP systems § . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Esker DeliveryWare and your SAP application § . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Automating accounts payable § . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Workflow and process tracking § . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Benefits of accounts payable automation § . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Creating a successful implementation § . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Conclusion §. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
About Esker §. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
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Introduction While SAP solutions empower businesses with accounts payable functionality and transaction data, manual entry and tracking of
vendor invoices remains a barrier to full business process efficiency and return on investment in SAP solutions. Many businesses running
SAP applications still employ conventional paper-driven accounts payable processes. As a result, they are limited in their ability to
minimize per-invoice costs, prevent duplicate invoices and take advantage of fast-payment discounts. Financial planning, vendor
relationships, employee productivity, inter-enterprise communication and even regulatory compliance efforts may suffer from lack of
automation in accounts payable.
Just as automated entry of vendor invoices is essential for process efficiency and quality assurance, data on invoice document
processing is crucial to daily operations. For example, vendor inquiries frequently create the need for information about the processing
status of an accounts payable transaction. Quick access to information on whether an invoice has been received, processed, or paid (as
well as data on the currently responsible agent) can significantly reduce turnaround time of vendor inquiries.
Recently, accounts payable processes have gained the interest of SAP customers seeking measures to speed up their purchase-to-pay
cycles, strengthen vendor relationships and gain negotiating leverage, and improve cash-on-hand planning. Beyond significant cost
savings, organizations using an automated accounts payable system can realize efficiencies throughout the process.
This white paper outlines these benefits and presents a unique solution, exploring automation of accounts payable processes within SAP
applications. It analyzes the challenges faced by companies today who are still using manual paper-driven processes, as well as the
benefits of automating processes — including time, labor and cost savings as well as increased visibility into the process. In doing so,
this paper highlights innovative technologies for comprehensively automated invoice management to optimize the purchase-to-pay cycle.
Above all, this paper is designed to assist CEOs, CFOs, CIOs, Accounts Payable managers and SAP system administrators in learning,
planning and evaluating automation of accounts payable processes to gain added efficiency in today’s competitive business environment.
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Conventional accounts payable with SAP systemsManually orchestrating your accounts payable operations is inherently inefficient and creates the potential for errors. Manual processes
are labor-intensive and time-consuming, requiring valuable resources to manage each part of the process.
In conventional accounts payable with SAP solutions, any document processing prior to invoice posting is a “black box” — detailed
information about what’s happening in the process is either unavailable or not readily accessible in the SAP system. Receiving and
entering the invoice, routing and resolving problems require manual intervention.
Automated invoice capture, workflow and tracking makes the process transparent. This visibility enables coordination and control to opti-
mize the process.
Conventional paper-based invoice processing
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Time
Receive Process Post
Esker DeliveryWare and your SAP application SAP customers struggling with high invoice error and dispute rates, long payment cycles, poor auditing and high administrative costs
related to manual processes — not to mention less-than-ideal relationships with vendors — can choose from several solutions to auto-
mate accounts payable processes. Only one offers patented DeliveryWare Rules Engine technology and a full range of document cap-
ture and delivery format capabilities to maximize the value of SAP applications and effectively control the time between invoice receipt
and payment.
Esker DeliveryWareEsker DeliveryWare offers a comprehensive solution that streamlines current business processes by eliminating inefficient steps, making
communication more personalized and cost-effective, regardless of the information source or delivery type. Esker DeliveryWare eliminates
manual touch points and brings visibility to the accounts payable process while causing no disruption of current business operations.
Designed to optimize internal and external information flow into and out of SAP applications, Esker DeliveryWare is an end-to-end doc-
ument process automation platform with patented technology. Managing all inbound and outbound document processes through this
central platform simplifies the IT infrastructure, reduces the time and costs associated with document communication and streamlines
critical business processes such as accounts payable.
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Document Capture DeliveryWare Rules Engine Document Transport
Esker DeliveryWare automatically captures invoices and other documents in any format — independent of layout and applicationor source, without the need for custom programming.
At the heart of Esker DeliveryWare ispatented technology that automaticallyrecognizes and extracts data fromelectronic documents to determine formatting, conversion, and routing conditions and actions that need totake place, as defined by processingrules. The optional Accounts PayableModule provides comprehensive workflow and process tracking capabilities.
Esker DeliveryWare distributes documents automatically, based on organizations’ specific requirements.They can be delivered to multiplerecipients in the most complete rangeof formats (text, XML, PDF, IDoc,PCL, PS, TIFF, etc.) and media (postalmail, fax, print, email, web, file transfer, archive, wireless message,etc.)
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Automating accounts payable Automating accounts payable yields significant savings by reducing the number of touch points involved at each step of the process.
The result is less manual data entry time and errors, shorter purchase-to-pay cycles, on-time payments, fewer duplicate invoices, faster
identification and resolution of issues, and better service to vendors.
Automation SavingsEsker DeliveryWare Accounts Payable Module helps SAP customers realize these benefits and will continue to help identify further areas
of improvement.
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$40 to $70
$4 to $6
Manual ProcessFlow
Estimated Cost
AutomatedProcess Flow
Estimated Cost
30 days
7 days
Invoice Payment Cycle
48 hours
4 minutes
Invoice processing time
Tight integration with SAP applicationsEsker is committed to simplifying document process tasks for SAP customers. SAP-certified Esker DeliveryWare integration is seamless
and does not require any reprogramming or business processes modifications.
Invoices arriving in various formats (paper, fax, email, electronic file, etc.) are automatically captured, approved and transferred to the SAP
content server or Esker DeliveryWare repository. On top of this, order data such as vendor name, purchase order number (for invoices with a
purchase order), quantity and prices, are automatically made available in the SAP system, replacing manual data entry. The invoice object is
linked to the stored document, allowing the user to retrieve the original document easily when necessary — directly within the SAP user interface.
The process flows through the following steps:
Step 1: Capture§ When an invoice arrives, it is automatically handled by Esker DeliveryWare, The document is recognized and converted using
document capture technology, and invoice data is extracted.
Step 2: Notification§ If desired, the user can receive a notification that a new invoice has arrived and that it needs to be validated.
§ By clicking on the link contained in the email notification, the user opens the Esker Document Manager web interface to access the
invoice validation web form.
Step 3: Validation§ Using standard BAPIs, the software checks that the vendor data and order data (for invoices with a purchase order) already exist
in the SAP system. For PO invoices, Esker DeliveryWare can perform two-way matching of the invoice with the PO, or three-way
matching of the invoice with PO and goods receipt.
§ In the event of a mismatch between the document and SAP master data entries, the user is able to browse SAP master
databases to match data extracted directly in the web form.
Step 4: Posting data to SAP system§ Data is then passed to the PTS (Process Tracking System)* invoice data capture module within the SAP system. This module creates a
process tracking record and attempts to post the PO-based invoice if desired. In case of an exception, or for those cases where
auto-posting is not possible or desired, an SAP workflow engine-based best-practice PTS workflow is started for that tracking record. The
workflow work item goes to the AP user’s workflow inbox, awaiting action. Upon execution, the SAP Workflow calls up the appropriate
transaction code for the posting of an invoice, and the document image appears alongside the pre-populated data*. See FOOTNOTE.
§ Documents can be saved and posted, at which point the work item disappears from the user’s workflow inbox.
§ If a business or technical condition exists that prohibits posting of the invoice, the user simply cancels instead of saving and
posting. A set of decisions relating to exception handling are presented to the user. Selecting a particular option triggers the corre-
sponding workflow behind the business process. The work item disappears from the user’s inbox and is placed in the inbox of the
appropriate person to perform necessary actions (for example, updating vendor master data or obtaining non-PO invoice approval and
coding through the SAP NetWeaver-based web link). Then the work item is sent back to the user, who can then post the invoice.
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* All references in this document that pertain to PTS, “process tracking” and SAP workflow refer to a solution developed by Dolphin IT-Project and Consulting Corporation. Process TrackingSystem (PTS) is a trademark of Dolphin IT-Project and Consulting Corporation. All rights reserved.
Workflow and process trackingBeyond automated receiving and entry of vendor invoices, optimizing accounts payable with SAP applications requires coordination and exe-
cution capabilities including invoice approval, exception handling and vendor inquiry management.
If your organization has ever…
§ been unable to fulfill a vendor’s request for the status of an invoice,
§ paid the same invoice twice,
§ missed out on fast-payment discounts
§ or made an inaccurate forecast of cash on hand,
… then you know access to current information is key to effective business management in accounts payable.
Incoming invoice documents launch the purchase-to-pay cycle. Fast response to invoices helps to strengthen vendor relationships and
enables organizations to take full advantage of fast-payment discounts. Incoming vendor invoices need to be entered and confirmed
quickly to allow for efficient payment scheduling. Reliable up-to-date information on the status of new vendor invoices is crucial for effec-
tive financial management and forecasting. Along with receiving and entering invoices, SAP customers seeking to optimize accounts
payable face challenges with:
§ Productivity
§ Late payments
§ Exception handling and invoice block resolution
§ Duplicate invoices
§ Vendor inquiry processing
As a comprehensive solution for accounts payable automation, Esker DeliveryWare offers workflow and process tracking* capabilities for
best-practice Accounts Payable management such as dynamic work item task descriptions, automated routing for exception handling, SAP
NetWeaver-based web/email invoice coding and approval, and detailed reporting — in addition to automated document capture and data
entry. SAP customers using Esker DeliveryWare benefit
from integration of data on transactions, documents, and
process status for financial reporting and process analysis.
These capabilities are tightly integrated with SAP Business
Workflow™ technology, and use SAP ArchiveLink™ to
facilitate capture of process information immediately after a
vendor invoice document has been entered. The process
information and the business document are instantly
available for reporting and display. SAP Business Workflow
automatically routes the business document to the AP
clerk for subsequent processing.
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* (PTS) “process tracking“ and SAP workflow refer to a solution developed byDolphin IT-Project and Consulting Corporation. PTS Process tracking System is atrademark of Dolphin IT-Project and Consulting Corporation. All rights reserved.
Tracking recordWhen an incoming invoice document launches the purchase-to-pay cycle, a tracking record is created. Index information, such as ven-
dor name and reference number, are stored in the tracking record and updated continuously during the subsequent accounts payable
process. The index information can also be used to automatically route documents and tasks to the responsible accounts payable clerks
without manual intervention.
Search and selectionUser accessing the transaction can choose from a variety of selection criteria to narrow down the search to a specific tracking record or
group of tracking records. Records can be quickly accessed by using the tracking record number, receipt date, vendor name, or SAP
document number. Choosing from an array of available search criteria, users can obtain other data valuable for financial accounting and
cash management. For example, all invoices that have been received, but not paid, and are due on or before a certain date can be found.
The number of payment blocks as well as the blocking reasons for certain vendors can also be obtained.
Process historyFor each tracking record, the corresponding financial accounting transaction and the archived document can be accessed. Sorting by
any column is possible and a real-time database refresh can be performed to receive up-to-date information. The process history of a
tracking record displays all relevant steps a process has gone through before reaching its current state. The process history records the
date and time of the step completion as well as the user who performed the corresponding tasks. In accounts payable, the process his-
tory creates a complete audit trail by tracking document receipt, transaction posting, possible exception handling for conditions such as
master data issues and payment blocks.
Benefits of accounts payable automationBeyond optimizing invoice receipt by taking manual paper routing and manual keystrokes out of the entry process, the Esker
DeliveryWare solution results in significant benefits both for business management and system administration.
§ Enhance financial and cash management
Workflow and process tracking with Esker DeliveryWare provides a central point of access to all accounts payable data in the sys-
tem. It contains continuously updated information about vendor accounts, amounts payable, due dates, and payment terms —
even before the corresponding transaction is posted in the SAP system — giving a complete picture of the current accounts
payable status in the system as well as cash flows that are to be expected.
§ Improve quality and effectiveness of vendor service management
Vendor inquiries regarding invoice receipt, processing and payment status can be comfortably serviced. Vendor service representa-
tives can easily locate accounts payable documents, obtain their processing status and history, and determine the responsible
accounts payable clerk, should further inquiry be necessary.
§ Take full advantage of fast-payment discounts and better payment terms
Esker DeliveryWare significantly improves processing time and quality by virtually eliminating manual task coordination as well as
information routing and transport. At the same time, document processing can be prioritized according to due dates and payable
amounts. Accounts payable processing can be focused and completed in a shorter and more definable timeframe. As a result,
organizations see fewer late payments and more fast-payment discounts — and gain a stronger position for negotiating favorable
payment terms with vendors.
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§ Obtain data for vendor and employee performance analysis
Process history provides a complete audit trail for each instance of an accounts payable process. It contains data on payment
blocks and blocking reasons which can be used to perform a detailed analysis of vendor performance with regards to invoicing
accuracy. The process history further provides valuable data on process time. This data can be used to identify bottlenecks and
critical paths in the internal process of an organization.
§ Eliminate photocopies and paper archive management
The Esker DeliveryWare Accounts Payable Module gives access to both the SAP transaction document and the archived original
attached. All documents can be viewed simultaneously by several users. This eliminates the need for photocopies as well as man-
ual document storage and retrieval procedures.
Typical results with Esker DeliveryWare — Accounts Payable Module include:
§ Up to 70% lower accounts payable processing costs
§ Lower stored data costs by electronic archiving
§ Up to 65% faster receiving and entering of vendor invoices
§ Up Increases your accuracy of data entry by up to 99%
§ Staff time freed-up by as much as to 65%
Creating a successful implementationTo ensure the success of your conversion from conventional paper-driven accounts payable to an automated process:
1. Search for a solution that offers the highest value.
To get the highest return on your investment, find a solution that will fully integrate your accounts payable process. It is highly likely that
you have different requirements from different suppliers and vendors. Make sure that the solution you choose can meet all your own
requirements as well as those of your vendors, such as diverse document formats, validation, approval, routing and archiving.
2. Search for a solution that can be integrated quickly.
Measuring the cost of deployment, integration and scalability to meet your needs and your vendor needs is crucial in choosing the cor-
rect solution. Search for a solution that will integrate seamlessly with your existing SAP applications without custom programming.
3. Expertise and knowledge are key to success.
Successful accounts payable automation must include both technology and expertise. How long has the company been implementing
these solutions and how many successful installations have they completed? Make sure they have a strong understanding of the essen-
tial tasks involved in enterprise technology implementation and integration.
4. Find solutions that create added value.
The solution must automate every piece of the accounts payable process. It should leverage your existing infrastructure to the value of
your current SAP system as well as other enterprise applications. A complete solution will offer advantages that stand-alone imaging and
workflow products cannot provide.
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ConclusionFor companies looking to optimize business processes, automating accounts payable processes can yield significant bottom-line return.
The purchase-to-pay cycle requires orchestrating transactions that span multiple steps, processed at different times by different systems.
Improvement in these performance variables enables SAP customers to benefit from:
§ Automated and centralized accounts payable processing
§ Early invoice prioritization and duplicate check
§ Consistent, quick exception handling
§ Real-time tracking of invoices
§ Easy storage and retrieval of invoices
§ Automated approval and reporting
§ Comprehensive data for A/P reports and benchmarking
To achieve these results, it is necessary to carefully assess the available market solutions and find one that meets all the needs in your
specific process. Inefficient business processes cause companies to miss tremendous opportunities for profitability, and can keep them
from improving competitiveness. Now is the time to automate, and the leading solution is Esker DeliveryWare for:
§ Integrated data/document capture
§ Flexible, automated task routing
§ Consistent exception handling procedures for canceled transactions and blocked invoices
§ Duplicate invoice checking
§ Minimized number of key strokes to complete accounts payable process
§ Continuous tracking of process data and status for vendor inquiry service
§ Dynamic work item descriptions and titles
§ Reports on process time and volume, queued invoices, exceptions and blocks, due dates, discounts, scheduled payments ...
even before the invoice is entered in the SAP system
§ Comprehensive business solution with view of all accounts payable processes in the SAP system
§ Quick, turnkey implementation without custom programming
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About EskerEsker is a recognized leader in helping organizations streamline manual, paper-intensive processes and reduce the use of paper by
automating the flow of documents into, within and outside the organization. With patented document delivery automation software (Esker
DeliveryWare) and hosted document delivery services (FlyDoc), Esker offers a total solution to automate every phase and every type of
business information exchange. Customers gain significant and immediate operational efficiencies, cost savings and measurable ROI in
as little as three to six months.
Founded in 1985, Esker operates globally and has over 80,000 customers and millions of licensed users worldwide. Esker has global
headquarters in Lyon, France and U.S. headquarters in Madison, Wisconsin. For more information, visit www.esker.com or
www.flydoc.com.
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Esker DeliveryWare White Paper
Contact Information
Australia § Sydney
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Germany § Munich
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Spain § Madrid
United Kingdom § Derby, Derbyshire
Madison, Wisconsin Ô U.S. Headquarters1212 Deming Way § Suite 350 § Madison, WI 53717
Toll-free § 800.368.5283
Phone § 608.828.6000
Fax § 608.828.6001
Email § [email protected]
www.esker.com
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Tel § +33 (0)4 72 83 46 46
Fax § +33 (0)4 72 83 46 40
Email § [email protected]
© 2006 Esker S.A. All rights reserved. Esker and the Esker logo are registered trademarks of Esker S.A. in the U.S. and other countries. SAP is the registered trademark of SAP AG in Germany and in several othercountries. Process Tracking System (PTS) is a trademark of Dolphin IT-Project and Consulting Corporation. All other trademarks are the property of their respective owners.
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