dramatic shifts are occurring, is your company innovating ... · the accounts payable &...

The Accounts Payable & Procure-To-Pay Conference & Expo is produced by: 5/31/2016

Innovation & Automation in Accounts Payable:

Dramatic Shifts are Occurring, Is your Company Innovating

Ahead of the Curve or Caught in Neutral?

Restricted © Siemens AG 2016 All rights reserved. intranet.gss.siemens.com

FSS at a Glance

Siemens Functional Shared Services NAM

May 2016 | Released Unrestricted © Siemens AG 2016 GSS

FSS is a large captive Shared Services organization,

with a broad portfolio of services

AFS Portfolio:

Accounts Payable

Accounts Receivable

Closing & Reporting

General Ledger

AFS Key statistics:

Employs 2,400 FTE1)

12.5 Mio. accounts payable

7 Mio. accounts receivable

BSS Key statistics:

Employs 450 FTE1)

BSS Portfolio:

Global Marketing

Services

Customer Management

Services

Mergers & Acquisition

SCMS Key statistics:

Employs 650 FTE1)

406,000 Purchase Orders / year

Calculated productivity of 3,265 purchase

orders per FTE

SCMS Portfolio:

PO Processing

& Clearing

OneSRM User

support

Catalogue

Management

HRS Portfolio:

Recruiting & Staffing

Learning & Development

HR Admin & Payroll

HRS Key

statistics:

Employs 2,300

FTE1)

4.4 Mio. travel &

expense claims

330,000 pay

checks per month

200,000 pensioners

per month

1 Based on figures of FY12 (Actuals rounded)

Global Mobility

Expense Reimbursement

Health Management

FSS currently employs

6,000 FTEs1)


Functional Shared Services North America Background

Established in 2000 – at that time as a separate legal entity

U.S. Headquarters in Orlando; offshore team in India

Shared Services location decision driven by proximity to Siemens businesses

No mandate: service-by-service, business-by-business; selling exercise still going!

Dual reporting lines – to U.S. functional heads and to global in Germany

Transactional billing model – expectation for ongoing price reductions

Siemens U.S. business very decentralized: 4 strong, independent Sectors

Sectors own ERP’s – sometimes local, sometimes globally; we work in approximately

16 ERP’s

In-house I.T. team supporting H.R. platforms across North America and other tools

(e.g., Workflow Solutions)


FSS Organizational Structure Cluster: North America

Accounting & Finance

Services (AFS)

Supply Chain Management

Services (SCMS)

Human Resource Services

(HRS)

Service Delivery Model

Indirect Material Procurement

SRM Support

Import / Export Compliance

Procurement and SRM – offshore

(captive) operations

Import/Export - onshore

Accounts Payable

Intercompany Accounting

Sales/Use Tax

Property Tax

Master Data Maintenance (vendor,

customer)

Abandoned, Unclaimed Property

General Ledger, Closing & Reporting

Fixed Assets

Accounts Receivable (Cash Apps)

Combination of on-shore Key Account

Management, off-shore (captive)

operations, and outsourcing

Payroll

HRIT

HR Administration

Global Mobility Services

Relocation Services

Recruiting and Staffing

Administration

Expense Reimbursement

Primarily onshore

Support Functions

Finance / IT / HR / Quality / Project Management / Communications / CRM

Total Headcount Onshore:

330

Offshore:

250


Moving to World Class will deliver significant

benefits for Siemens

We take non-core processes of businesses and make them core to us

We increase our customers’ productivity and generate savings

We ensure transparency, quality and compliance in all processes

We understand our customers’ business requirements

We help the businesses to fulfill their growth targets

What is in it for Siemens?


Siemens Global Shared Services NAM

Electronic Invoicing Journey, 2008 - 2015


Defined Objectives & Goals for Automation:

8

• Increase eInvoice submission and eVouchering can assist

SOCs to reduce cost associated with Siemens 20% SG&A

cost reduction initiative

• Two primary goals:

− 90% Electronic Invoicing submission

− 95% Electronic Vouchering success rate

Enable Siemens Business Units to reduce cost and improve quality in

the Accounts Payable process through increased electronic invoice

submission and vouchering.

Aggressive rollout to exceed the Siemens 22% G&A cost reduction

target in the area of Accounts Payable within one year.

80% electronic receipt of invoices

95% e-vouchering / posting rate of an electronic invoice

Objective

Primary Goals


Vision of Siemens AP:

1.Take the AP function beyond transaction processing into more strategic

partnership and value-add activities.

2. Provide significant cost savings to the Siemens operating companies that

we support.

Siemens Global Shared Services NAM

2008 2015

Siemens Business Unit Divisions 26 50+

Invoices Processed 1.4 million per year 1.5 + million per year

Global Supplier Base 63,000 over 100,000

Siemens Real Estate, A Division of Siemens Corporation Siemens Financial Services Siemens Industry, Inc.- INC-MVSG

Siemens Capital Company FSS North America, A Division of Siemens Corporation Omnetric Corp

Siemens Credit Warehouse, Inc. Siemens Corporation, Corporate Technology, A Division of Siemens Corporation Siemens Medical Solutions (P40)

Siemens Energy, Inc. SMI Holding LLC Siemens Healthcare Diagnostics (P40)

Siemens Generation Services Company Siemens Philanthropic Fund Siemens Medical Solutions (P41)

Siemens Fossil Services Inc. Siemens Foundation Siemens Healthcare Diagnostics (DPC/BAYER)(P40)

Siemens Power Generation Operating Services Company Siemens Caring Hands Siemens Canada Limited

Siemens Power Generation Service Company, Ltd. Siemens Industry, Inc - SBT Siemens Building Technologies (Canada)

Siemens Power Generation Service Company, LTD - Mexico Branch Siemens Industry, Inc - SEA Corp Siemens Transformers

Siemens Power Generation Service Company, LTD - Puerto Rico Branch Siemens Industry, Inc. - SII Siemens Milltronics Process Instruments Inc.

Siemens Energy, Inc (Wind Division) Siemens Electrical, LLC Trench Limited

Siemens Demag Delaval Turbomachinery, Inc. Siemens Industry, Inc.- SII-RA-SII-CT, RITS Siemens Healthcare Limited

Siemens Energy Inc, Oil and Gas Division Siemens Postal, Parcel & Airport Logistics, LLC Siemens PLM

Siemens Corporation Siemens Industry, Inc. - STS Siemens PLM Canada


AP Automation

Key Performance Indicators FSS (US & CAN)

2008 2009 2010 2011 2012 2013 2014 2015

Accounts Payable

Invoice

volume

1.2M 1.8M 1.8M 2.1M 1.8M 1.7M 1.7M 1.8M

Electronic

Invoice

Submission

41% 56% 69% 77% 77% 81% 84% 86%

Electronic end

to end

26% 48% 55% 62% 63% 69% 70% 71%

Electronic

payment

61% 67% 76% 78% 82% 82% 85% 88%

Inquiries per

Mo

NA 31,770 16,447 9,420 8,367 6,922 6,468

6,257

IOL Mo Hits NA 39,796 53,599 74,488 75,858 76,144 70,704 67,075


Electronic invoice submission breakdown

Submission method 2015 Invoice Vol %

Corporate EDI 22.72%

Direct Insite (IOL) EDI 6.17%

Paper 16.39%

Web Non PO (IOL) 1.97%

Web PO Flip (IOL) 52.74%


E-invoicing and end to end process automation


Customer self service inquiry tool

Self Service Invoice Inquiry

All employees and Vendors have access to IOL to look up the status of any

invoice. They simply search for the invoice in IOL:



If assistance is still required after researching and reviewing an invoice

status in IOL, an inquiry can be sent to the customer service support team.

Select the invoice (1) and click the “Inquiry” icon (2) to open a pre-

populated form for questions. (3) Complete the form by entering your

question in the “Please Enter Inquiry Details” and then select “Submit

Inquiry”.

2

1



3

(3) Complete the form by entering your question in the “Please Enter Inquiry

Details” and then select “Submit Inquiry”.



For Non-invoice inquiries or when the invoice cannot be found in IOL, use the “General

Inquiry” found under the “Non-Invoice Inquiry” section. The form will be pre-populated

with the user’s contact details. Required fields are inquiry reason, Siemens Operating

Company and the Reason for Inquiry. After completing the required fields, select

“Submit Inquiry”.


Automated Survey and results providing

feedback for process improvement

Automatic Survey – A survey is emailed to all AP inquiry submitters (both phone

and IOL) when each C&O ticket is resolved. The results of the survey are compiled

in Survey Monkey and sent monthly to our Customer Service Team where they

generate the USI score and analyze the feedback. This feedback provides us

valuable data to:

• Identify areas for process improvements and re-train agents if necessary

• Educate vendors and employees on the AP process to further reduce inquiries

• Constructive feedback from customers on how we resolved their inquiry – both

positive & negative

• Red Alerts for ratings of 4 and below - we reach out to the customer and

determine the root cause for the negative rating and any corrective actions


Customer Survey scores


50

Operating

Companies

SAP

50

Operating

Companies

SAP

Solution Overview

22

50

Business

Units

SAP

EZ-AP

Vendor

Invoice

Data

Store

Web Entry,

PO Flip &

Spreadsheet

Invoices

Direct

Integration

Invoices (EDI or XML)

Direct

Insite

Solution

Vendor Self

Service Inquiry

Validation,

Increased

eVoucher

success rate

Direct

integration

Scan for Paper

invoices

No more paper

All invoices converted to one standard

New PO/PO Change

Invoice

Suppliers 100,000+

Workflow 16+ ERPs

Paper

Invoices


Key Strategies for e-invoicing Implementation

Aggressively targeted high-volume suppliers

Targeted problematic, poor quality paper invoice suppliers

Established a Vendor Adoption Committee with representatives from all Business Units

and weekly meetings

Changed the Bill To Address on the PO to reflect the electronic submission method

Established and promoted e-invoicing as “the way of doing business with Siemens”

Provided Procurement groups with standard communication and quick training guides

for suppliers

Required by contract in Terms and Conditions that all new vendors submit invoices

electronically

23


6% of Suppliers produce

79% of Invoices

Implementation Strategy:

Targeted High Volume Suppliers

24


Established a “Vendor Adoption Committee” with representatives from all divisions.

Internal Education is as important as external communication

Goal of the committee is to set clear objectives, measure results and report to executives

Example of Key Drivers tracking chart:

25

Implementation Strategy: Vendor

Adoption Committee

Key Drivers - eInvoicing Requirement SOC SOC SOC SOC SOC SOC SOC SOC SOC SOC SOC SOC SOC SOC

Standard Onboarding package for Vendors

VM E-form back end automation

eInvoicing Awareness Campaign (MarCom

Insert, RFP, Contract Renewals, update T&Cs)

Paper address excluded from Purchase Order

eInvoicing info included on Purchase Order

VAC Team members & Communication of

Targets

TPA/CSP Strategy - ApprovedN/A

Target

Met

IOL Strategy - ApprovedTarget

Met

Target

Met

- Vendors identified - Target 7/16/10Target

Met

Target

Met

- 1 letter sent - Target 7/30/10 Target

Met N/A

Target

Met

- Invoices rejected - Target 8/16/10*Target

Met N/A

Target

Met

E-invoicing requirement placed for new vendors

EFT Campaign (combined with IOL letters)N/A N/A

Automate payment runs

Vendor Adoption Committee RepresentativeNAME NAME NAME NAME NAME NAME NAME NAME NAME NAME NAME NAME NAME NAME

Vendor

Master

E-

payment

E-invoicing

Division Division Division Division

1


Lessons Learned

Internal Support

Procurement support is crucial to adopt and sell e-invoicing

Executive Sponsorship is necessary at business units level in Shared Services

Encourage e-invoicing mandate or define criteria for e-invoicing process before Go

Live with internal departments Supplier On boarding

Accurate Contact Information is Key for Recruiting Suppliers

Target 3 types: high volume, high $ value & traditional “problematic” suppliers

Training & Support must be available - including on demand

Prepare quick guides using screen prints

Realize that Behavior Change is hard

Make Service FREE to Suppliers

Sell tool to suppliers – explain benefits

Allow different methods of electronic invoice submission

Ensure dedicated helpdesk and set expectations on supplier support

Self Registration to e-invoicing portal for suppliers is critical Straight Through “Touch less” Processing

Updated PO data must be available in the portal to enable PO Flip

E-invoice with bad information is almost as bad as a paper invoice

Encourage PO Flip

Establish P2P end to end true EDI process if possible

Ensure up to date vendor master data to ensure match with vendor

26


What’s Next?

Increase and improve Web AP Inquiry

No more e-mails & fewer phone calls

All inquiries must be submitted through

web portal:

External / Supplier Inquiries

Internal / Employee Inquiries

Global Vendor on Boarding Portal

Data input from Supplier

Reduction in manual effort

Improved data accuracy

Quicker PO placement

Reduced payment errors

Central repository of Supplier data

Invoice Submission

Up front invoice validation

Early Payment Discounts

Projects in place to increase supplier ability to take

early payment discounts

27

Customer Service AP Inquiries / Year

Sept 09 Sept 10 Sept 11 Sept 12 Sept 13 Sept 14 Sept 15

Inquiries by

Calls 7,260 4,458 2,312 2,411 1,854 1,338 1,477

Inquiries by

Emails 24,510 10,325 899 1,043 761 301 497

IOL Web

Inquiries 1,664 6,209 5,102 4,345 4,647 5,296

Total Inquiries 31,770 16,447 9,420 8,556 6,960 6,286 7,270

IOL Website

Hits 39,796 53,599 74,488 75,858 76,144 75,199 74,791

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