IFO Spring MeetingMilwaukee, WI29 April 2014

Key Strategies for Best-in-ClassAccounts Payable

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Welcome & Introductions

• Matt Hein, Strategic Account Executive

• Ed Modjeska, Director of Strategic Accounts

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Agenda

• Introductions

• Automation Concepts & Stages

• Best Practices

• Q&A

• Case Study

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Naviant Overview

Founded 1986

Headquartered in Madison, WI

2,500+ Global Customers

BPM-FocusedProcessPeople

Technology

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Unstructured Content & Ancillary Data

Unstructured Content & Ancillary DataUnstructured Content & Ancillary Data

Email

Web Pages

Enterprise Applications

FaxElectronic Documents

FormsReports

Mail

Graphics, Video, & Audio

XML & Meta Data

Print Output

Ancillary & Disparate Data

Paper Documents & Files

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Partial List of Customers

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Automation Concepts & Stages

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AP ROI Objectives

• Reduce Need for Physical Storage

• Reduce Manual & Duplicate Data Entry

• Eliminate Manual Handling & Routing Time

• Reduce Processing Costs

• Eliminate Duplicate Payments & Reduce Late Fees

• Instant Access to All Invoice Transactions &Supporting Documents

• Enhance Management Visibility & Controls

• Ensure Compliance & Audit Requirements

• Improve Vendor Relations & Reduce Payment Calls

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More Than Just Invoices…

• Cancelled Checks• Purchase Orders• Packing Slips / BOLs• Credit Memos• Advance Shipping Notice• Remittance• Collection Notices• Expense Reports• Vendor Management

– Contracts– Contacts– Discount Structures– Incidents– E-Mail Communications– Credit Reports

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Enterprise Content Management (ECM)

• Enterprise Content Management (ECM)– Simple definition… scan & process paper

• Expanded Definition*– ECM is the strategies and tools used to capture,

process, access, integrate, measure and store unstructured content (paper, email, fax, reports, etc.) related to business transactions

• ECM Tools & Strategies Allow the Management of an Organization’s Unstructured Information, Wherever That Information Exists

*Source: AIIM (the community that provides education, research, and best practices to help organizations find, control, and optimize their information)

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Enterprise Information Management

80 00

90 10

ECM

EnterpriseContent

Management

DocumentManagement

CaseManagement

BusinessProcess

Management

DM BPM CM

MTM Founded Naviant Group Acquired

MTM Suite Expanded Naviant Evolution

IndustryEvolution

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Enterprise Information Management

Structured Data & User Interface

Unstructured & Ancillary Content

Capture, Recognize, Process, Access, Integrate, Measure & Store ECM

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AP Automation Process Considerations

Capture Recognize Process Integrate Access Measure Store

Email OCR/IDC Verify Data Validation ERP Reports Archive

Images

Fax Extract POExceptions

Create & Post Mail Dashboard Security

Mail/Scan Line Pairing

Non-PO Approvals Retrieval Mobile Metrics Records

Retention

EDI Validation Other Workflows

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Stages & Concepts of AP Automation

PayStream Advisors – Imaging and Workflow AutomationNaviant Group – AP Process Automation Best Practices

Cos

t Per

Invo

ice

1

2

3

4

Leve

ls o

f Aut

omat

ion

Stages of AP Automation

De-CentralizedLate ScanningManual IndexingManual Approvals

CentralizedEarly ScanningKey From ImageElectronic MatchingManual Workflows

CentralizedEarly ScanningKey From ImageAutomated WorkflowsAutomated VerificationsAutomated Postings

CentralizedEarly ScanningOCR/IDC ExtractionAutomated ValidationsAutomated WorkflowsAutomated VerificationsAutomated PostingsStraight-thru-ProcessingSelf Service Portals

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Best Practices

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Best ECM Practices for AP

1. Early Capture & Process Automation

2. User Transparency

3. Reduce or Eliminate Keying

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1. Early Capture & Process Automation

• Capture as Early as Possible in the Process– Scan or electronically ingest emails & faxes– Eliminate lost or damaged documents– Eliminate intercompany routing / courier expenses

• Centralize Capture & Processing

The Institute of Financial Operations – 2012 Global Trends in Automated Data Capture in AP

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1. Early Capture & Process Automation

• Initiate Content-Centric Processes via Workflow– Process work faster and more accurately– Adhere to standardized rules and actions

• Schedules of Authority, approvals & exceptions– Allow system to facilitate non-value added tasks

• Notifications, routings & timers• Auto indexing & keyword lookups• Work load balancing• Ingestion of electronic documents

– Provide Audit Trail for Compliance & Visibility

• Mobile Workflow– Android, Blackberry, iPhone, iPad & Windows Mobile– Enhance accessibility & improve processing times for

remote employees

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1. Early Capture & Process Automation – Example

• Invoice Approvals– Scan or electronically ingest invoices upon receipt– Route electronically for Schedule of Authority approval– Manage exception processes electronically– Capture approvals and necessary transaction information– Route to accounting for keying / posting to ERP– Improve Procure-to-Pay

AccountsPayable

Approval

Key from Image

WorkflowIncoming Invoices Capture / Scan ECM AP ClerkReview

ERP

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2. User Transparency: LOB Integration

• Compliment Existing Systems w/ User Transparency

• Link Content for Quick Retrieval from ERP / LOB

• Extend Robust ECM Functionalities– Search, indexing, data sharing, related documents,

workflow… etc.

• Enable Advanced Processing Functions– Automate data validation– Automate transaction posting

• Integrate with…– ERP System(s)– Email– Microsoft Office– Mobile Devices

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33

34

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2. User Transparency: Email & Mobile Integrations

• Extend: ECM Access to Mobile Devices & Email– iPhone– iPad– Android– Windows– Blackberry– Outlook– Lotus Notes– Novell GroupWise

• Engage: Users via Familiar Apps– Intuitive Email Access & Functions– Native Mobile OS Touchscreen Gestures & Navigation

• Execute Workflows• Create E-Forms• View Documents & Keywords• Query Searches

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Android Invoice Approval

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3. Reduce or Eliminate Keying

• Stop Keying the Same Data to Both ECM & ERP

• Key-from-Image vs. Key-from-Paper– Content (documents & data) is available earlier

in the process– Less paper clutter

• ECM Integration Functionalities– Provide “screen scraping” of index / transaction data– Entry of transaction data is entered only once– Eliminate “fat fingering” of keyword data entry– Assure data continuity between systems– Ability to initiate Workflow processes or E-Forms– Dual monitors are often helpful

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Zonal OCR

• Documents with Static Structure– Forms, templates, orders, etc.

• Creation of OCR Zones for Data Extraction– Template setup

• Automated Document Classification & Indexing– Document types– Keyword values

• Release to ECM or Other Transactional System

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4C. Zonal OCR - Example

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Zonal OCR - Benefits

• Complete Transactions Faster

• Reduce Manual Indexing Time & Costs

• Improve Data Accuracy & Document Availability

• Relatively Small Investment

• Meets Basic OCR Requirements

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Advanced OCR for Unstructured Documents

• Documents with Un-Structured Data & Format– Invoices, EOBs, remittances, contracts, etc.

• Advanced Search (No OCR Zones) for Extraction– Usually non-template setup

• Automated Extraction for Classification & Indexing– Document Types– Keyword Values

• Complex Rules for Advanced Functionalities– Ability to extract header, footer, and line-item details– Real-time validation/matching of ERP data– Transaction posting for straight-through processing

Best-in-Class are 60%More Likely to Utilize

Optical Character Recognition Solutions

Aberdeen Group

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Invoice Number

24568

Invoice Date

10/05/2008

Name

Unitectic Industries

Address

151 Second AveRichfield, VT 05440

P.O. Number

702133648

Customer ID

YARGO

Line Item #1Quantity Item Description Unit Price Extension

76.00 C2270 CATALYST-OZONEDESTRUCT

30.47 2,315.72

Line Item #2Quantity Item Description Unit Price Extension

10.00 DE56 COMPRESSION FITTING -978

15.63 156.30

Subtotal

2,472.02

Freight

225.30

TOTAL

2,697.32

Advanced OCR for Unstructured Documents: Example

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Invoice Number

24568

Invoice Date

10/05/2008

Name

Unitectic Industries

Address

151 Second AveRichfield, VT 05440

Customer ID

YARGO

Line Item #1Quantity Item Description Unit Price Extension

76.00 C2270 CATALYST-OZONEDESTRUCT

30.47 2,315.72

Line Item #2Quantity Item Description Unit Price Extension

10.00 DE56 COMPRESSION FITTING -978

15.63 156.30

Subtotal

2,472.02

Freight

225.30

TOTAL

2,697.32

43072

43074

43075

43076

43077

43078

43079

43080

702133646

702133647

702133648

702133649

702133650

702133651

702133652

702133653

2221442

2221443

2221444

2221445

2221446

2221447

2221448

2221449

702133648

P.O. Number

702133648

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Advanced OCR for Unstructured Documents: Benefits

• Complete Transactions Even Faster

• Eliminate Non-Value-Added Tasks

• Migrate Manual Indexing Tasks to Data Validation

• Improve Processing Times

• Meet Complex OCR Requirements

• Align with Best-in-Class Global Organizations

• Larger Investment = Larger ROI

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AP Automation Components: Stage 4

ECM

Retrieved via SAPfrom ECM AP Clerk

Incoming Invoices Capture / Scan

OCR Extraction& Matching

Workflow Non-PO Approval& PO Exceptions

Data Verification

Rules EngineTIFF

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Summary Recommendations

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Summary Recommendations

• Centralized Processing / Shared Services– Centralize processes– Improve controls & reporting– Eliminate redundant operations

• Capture Early & Automate– Rapid access & processing benefits– Audit trail, security & visibility improvements– Let your systems work for you

• Integrate– Indexing, retrieval, matching, posting, workflow… etc.

• OCR/IDC– If applicable

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But Don’t Ignore… Future State Process Planning!

• Identify Strategic Vision & Engage Leadership

• Ensure Compliance & Audit Requirements

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Open Discussion & Questions

?Ed Modjeska

emodjeska@naviant-inc.com

Matt Heinmhein@naviant-inc.com

Naviant, Inc.www.naviant-inc.com

888.686.4624

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Naviant 18th Annual ECM Leadership Summit

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Customer Case Study

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Customer Case Study

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Customer Case Study

• Situation Overview– Fortune 100, multi-billion dollar, global manufacturer– Employs 20,000+ employees worldwide– Annual revenue of approx. $6 billion– 2+ million invoices per year

• 6.2 million invoice details per year• 1,200+ different vendors via fax, mail, and email

– Invoices received at multiple operating locations– Legacy systems– SAP ERP– OnBase ECM (late storage only)

AP ProcessAutomation

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Customer Case Study

• Key Business Objectives– Reduce manual effort & cost to process invoices– Centralize control of AP invoices– Increase early pay discounts– Eliminate duplicate payments– Enhance visibility of current AP liability– Leverage existing technology– Implement new technology as appropriate

AP ProcessAutomation

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Customer Case Study

• Key Process Changes– Eliminate paper handling early in the process

• Invoices are scanned upon receipt• Data is automatically extracted down to the line-item

detail with Brainware– Automate PO transactions

• PO line item matching with Brainware, OnBase & SAP• Manage exceptions & approvals with Workflow• Post PO invoices without human intervention

– Automate non-PO transactions• Manage Schedule of Authority within Workflow• Collect GL and transaction data within Workflow• Post non-PO invoices without human intervention

– Audit trail is automatically maintained in one location– Integrated document retrieval within SAP

AP ProcessAutomation

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Customer Case Study

AP ProcessAutomation

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Customer Case Study

• Key ROI Indicators– Estimated $1.5 million in the first year alone

• Reduced labor costs by 18.5 FTEs savings of 60%• Improved posting of 60% of invoices without human

intervention• Increased early payment discounts & timely

approvals– Complete audit trail & Schedule of Authority transparency– Increased accuracy of invoice processing– Greater visibility & reporting capabilities

• Plus…– Recently leveraged to EMEA & Asia Pacific regions– Latin America is “next in queue”– Order Management project

AP ProcessAutomation