Transcript
Page 1: Derbyshire County Council

CUSTOMER SUCCESS STORY

Derbyshire County Council serves a population of 750,000 and employs around 37,000 staff. The Council is responsible for providing many services, including education, roads, and social care services. Some of the day-to-day finance activities of the Council produce a staggering volume of information with some 20,000 vendors, resulting in 250,000 invoices per year being handled by the Accounts Payable team.

In late 2008, Derbyshire made the decision to implement an SAP® Enterprise Resource Planning (ERP) system. This would form the basis for a significant programme of change, replacing an ageing mainframe system that was becoming increasingly difficult to maintain. With the mainframe IT workforce reaching retirement age and no sign of being able to keep pace with current, let alone future regulations, it was time to start the process of moving away from their bespoke, in-house-developed mainframe system.

Handling vendor invoices: The old wayWith vendor invoices arriving at numerous locations throughout the county, and a manual process to approve and match invoices to purchase orders, it was possible for invoices to be lost before reaching the Accounts Payable team. When invoices arrived, details were manually entered into the system, further increasing the likelihood of errors.

“All this led to an inability to meet prompt payment targets. A downside was that early or even prompt settlement discounts could not be claimed. Gaining a clear picture of the Council’s financial liability at any point in time was an almost insurmountable task. Change was definitely needed,” says Chris Woodhouse, Finance Lead Officer (SAP), Derbyshire County Council.

Selecting the right solutionIn early 2009, Derbyshire looked at the feasibility of adding the capability of SAP to handle vendor invoices in a more efficient way. Business requirements were scoped, along with a stated objective of using a commercially available, out-of-the-box solution that didn’t require customisation or significant configuration. This was the basis of their SAP ERP project and any additional capability had to follow this model. They also wanted the comfort that any solution selected was proven and well supported. They took up the chance to visit an existing OpenText Vendor Invoice Management for SAP® Solutions customer and were impressed with what they saw.

“We selected OpenText, then set about the project in April 2009 with the objective of going live with not only SAP but also OpenText in April 2010; an aggressive timeframe,” Woodhouse says.

Industry

Public Sector: UK Local Government

Customer

Business ChallengesA Ageing mainframe system, difficult to

integrate and maintainE Efficiency drivers and cost-reduction

targets S Skilled knowledge workers reaching

retirement ageI Increasing difficulty in meeting new and

emerging regulations

Business SolutionI OpenText Vendor Invoice Management

for SAP® Solutions (sold by SAP as SAP Invoice Management by OpenText)

Business BenefitsI Greater efficiency in vendor invoice

processingI Reduction in processing timesI More flexible, detailed reporting and

analysis now possibleI Ability to identify bottlenecks in

processes and take remedial actionI Full audit trail, retention, and

disposition scheduling

Taking Control: 250,000 Vendor Invoices at Derbyshire County Council OpenText helps reduce physical paper storage, eliminate duplication, provide management reporting, and streamline end-to-end “invoice-to-settle” process times

Page 2: Derbyshire County Council

Visit online.opentext.com for more information about OpenText solutions. OpenText is a publicly traded company on both NASDAQ (OTEX) and the TSX (OTC). Copyright © 2011 by Open Text Corporation. Trademarks or registered trademarks of Open Text Corporation. This list is not exhaustive. All other trademarks or registered trademarks are the property of their respective owners. All rights reserved. 11MACU0179EN

Introducing a new way of workingAn intrinsic part of the project, key to its success, was getting the right people involved. With around 1,000 staff involved in the ‘invoice to settle’ process, a lot of people would be affected by change. Gathering requirements from the business, keeping people informed along the way, and having what would be the eventual users of the system involved in testing all paid dividends with the implementation.

OpenText Vendor Invoice Management for SAP® Solutions now centrally captures incoming invoices and performs initial checks on the documents. Standard metadata is extracted and, where appropriate, is matched to a purchase order within SAP ERP. If a full match is found, the invoice is sent for payment. If no exact match is found or some other discrepancy is highlighted, the invoice is automatically routed to an exceptions work queue which appears in the users’ standard work list within SAP ERP. A member of the Accounts Payable team is then able to view the scanned invoice and make any necessary updates and then route the invoice for approval as normal.

With Accounts Payable staff utilising the solution throughout their working day and up to 1,000 staff in total interacting in some way with the solution, user adoption is a critical factor for success. Training of staff was delivered in one of two ways—for power users, formal classroom training was provided, and for other users, a series of mini guides with step-by-step instructions and screenshot illustrations were utilised. Both methods have been well received and user acceptance of the solution has been high.

Recognising the business benefitsWith the solution going live in April 2010, the full benefits haven’t yet been realised. But already some elements are becoming visible with others expected in the future. For a fully-matched invoice (i.e. one with a full purchase order cover and a full match of metadata) the time from scan to being sent for payment is now a matter of minutes, with no paper being sent around the Council.

Reporting capabilities of the solution are already providing significant improvements over the old system. Queries can be made and feedback is instantaneous, for example, identifying where bottlenecks exist and enabling staff to take remedial action to address any issues. The Council is now able to report on its vendor liability, something that was effectively impossible before due to the length of time the preparation took. Reporting functionality is also being used to analyse multiple low-value transactions with vendors as a basis to support migration to consolidated invoices.

Derbyshire, like all other Councils, are continuously under pressure to do more with the same or less budget. During their analysis phase, they calculated that the cost to process each vendor invoice was significant. Derbyshire fully expects that OpenText Vendor Invoice Management for SAP® Solutions will significantly reduce these costs. Added to the potential savings in space resulting from storing less paper and the ability to take advantage of early and prompt payment discounts, overall, the solution is on its way to providing the return on investment Derbyshire set out to achieve.

Paving the way for the futureEven though the solution has been viewed as an overall success to date—being on budget, on time, and meeting requirements—it’s not to say that lessons haven’t been learnt along the way.

For example, the chart of authority is now viewed as overly complex and therefore requires a large amount of time to maintain. This is now under review and will be simplified. Further areas are being looked at in detail to see where processes can be further streamlined, reducing costs and providing additional cashable benefits. “Overall we’re very happy with the solution and look forward to a long and fruitful relationship with OpenText, as together we explore other avenues,” concludes Woodhouse.

[email protected] +44(0)1189 848 080

www.opentext.com


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