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Accelerating E-Invoice adoption and roll-out with SAP UK & Ireland SAP User Group Conference 2011 20 th 22 nd November 2011 Frank Ruland, Line of Business Solutions, SAP AG

Accelerating E-Invoice adoption and roll-out with SAP

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Accelerating E-Invoice adoption and roll-out with SAP

UK & Ireland SAP User Group Conference 2011

20th – 22nd November 2011

Frank Ruland, Line of Business Solutions, SAP AG

Agenda

How SAP E-Invoicing for Compliance Simplifies Financial Operations

• Introduction and SAP Solution Overview

• Customers are Realizing Substantial Value with SAP Solutions for E-Invoicing

• Questions and Answers

Businesses Are More Reliant on Their Network of Partners than Ever Before

“ …thanks to an ever-more-globalized business environment, more large companies now see attractive market

opportunities beyond their borders, further highlighting the need to establish an efficient B2B infrastructure with local

subsidiaries and suppliers.

Gartner, 12 October 2010, Market Trends: Application Infrastructure and Middleware Software, Worldwide, 2009-2014

Trend #1: Increasing Complexity of Network

New markets, mergers and acquisitions, global supply chain

Increasing number of business partners and subsidiaries

Trend #2: Accelerated Speed of Business

New product and services introductions; new suppliers and partners

Rapid partner on-/off-boarding due to changing market conditions

Forrester Consulting, Joint Industry EDI/B2B Survey, March 2010

0

5,000

10,000

15,000

20,000

25,000

1,000

+

Interfaces

Partners

500 250 750

Industry Data Confirms Paper-based Processes Are Inefficient and Expensive

PayStream Advisors, IWA Summit Billentis – based on 1.5 page invoice and €60/hour staff cost

Error-Prone Paper-based Processes Are Inefficient and Can Damage Relationships with Customers and Suppliers

1. Customers

Electronic billing mandates

Format and country- specific requirements

2. Accounting & Finance

No universal view of departmental invoices

High cost per invoice

3. Purchasing

Resolving problem invoices

Missed cash discounts

5. CIO/CFO

Increase compliance risks

Higher cost of capital, lower productivity

4. Suppliers

Lost paper invoices

Late payments slow cash flow

Accounting/

Finance

CFO

Purchasing

E-Invoicing Increases Transparency, Productivity, Compliance and Business Partner Satisfaction

Accounting/

Finance

CFO

Purchasing

Suppliers

Customers

5. CIO/CFO

Global visibility

Stronger controls, audits and improved compliance

Integrated systems and processes

1. Customers

Comply with electronic billing goals

Automate processes to improve supplier e-Invoicing

2. Accounting & Finance

Consistent payments across countries and organizations

Lower cost of capital

3. Purchasing

Increased productivity

Greater percentage of cash discounts captured

Lower cost of goods purchased

4. Suppliers

Improved vendor relationships

Reduced DSO

Improved cash flow

Going Paperless Can Improve Speed, Accuracy, and Compliance While Reducing Costs

How do I improve our financial

operations processes?

How do I provide my customers

with paperless bills?

How can I standardize and

accelerate invoice receipt and

retention?

Improve productivity

Compliant record keeping

Complete audit trails

Reduce cost per outgoing invoice

Eliminate paper and postage

Speed compliance with customer

format mandates

Shorten customer-to-cash cycle

times

Eliminate manual data entry

errors: reduce disputes, rejections

and re-submissions

Eliminate manual reconciliation

effort

Increase on-time payment

percentage

CFO Outbound E-Invoicing

(E-Billing) Inbound E-Invoicing

Outbound E-Invoicing SAP E-Invoicing for Compliance

Outbound

E-Invoicing

Digitally Sign Invoice

Send PDF via Email

Send EDI

Check Legal Compliance

SAP Solution

Provide invoices to your customers in the format they

demand

Provide compliant digital signatures

Improve productivity of A/R department accounting

shared-service

SAP Differentiators

Integration: Integrates with SAP back-end systems for

accounts receivables

Support: Solution is covered with enterprise support from

SAP and Crossgate

Scalability: Ability to dispatch large volumes of invoices

from shared-service centers

Inbound E-Invoicing SAP E-Invoicing for Compliance

Inbound

E-Invoicing

Receive Electronic Files

Verify Compliance

Transmit Data to ERP

SAP Solution

Receive electronic invoices via standardized interfaces (PDF invoice,

EDIFACT D96A, signature/verification file)

Automatically verify/perform all required format, content and signatures

Seamlessly transfer invoice data to ERP for further processing,

approvals, and archiving

Improve productivity of accounting department /accounting shared-

service

SAP Differentiators

Internal Control: Verify documents and signatures for all incoming

invoices according to compliance requirements in over 38 countries

Direct Access to Global Partner Network: Leverage SAP’s world class

network of business partners to accelerate adoption by your suppliers

and increase percentage of electronically received invoices

Straight-through invoice management: Transmit invoices to ERP and

invoice processing systems and archiving, improving quality by

eliminating manual intervention

Exchange Electronic Invoices with Any Business Partner in Any Format

Supplier 1

Supplier 2

Trust Center

Customer B

Customer A

Your Company

Email signed

PDF

EDI

Archive EDIFACT

Signed

PDF +

XML

Archive

B2B Hub VAN

Electronic

Signature Verification

Signed

EDI EDI SAP E-Invoicing

for Compliance

Supplier 3

Supplier 4

Supplier 5

Customer C

Customer D

Customer E

SAP E-Invoicing for Compliance in the Accounts Payable Process

HUB HUB

EDI

PDF/email

Digital

Signature

Validation

ERP (FI/AP)

SAP

SAP

SAP SRM

Supplier

Hubs and Portals

Payment

iDOC + supporting

docs (e. g. signature,

verification protocol)

SAP E-Invoicing

for Compliance

HUB

Invoice

Mgmt in

ERP

SAP

Archiving

by

OpenText

Document Archiving

& Viewing

Optional

SAP E-Invoicing for Compliance in the Accounts Payable Process

HUB HUB

EDI

PDF/email

Digital

Signature

Validation

ERP (FI/AP)

SAP

SAP

SAP SRM

Supplier

Hubs and Portals

Payment

iDOC + supporting

docs (e. g. signature,

verification protocol)

SAP E-Invoicing

for Compliance

HUB

Automation,

process support

SAP

Invoice

Mgmt by

OpenText

SAP

Archiving

by

OpenText

Document Archiving

& Viewing

Optional

SAP E-Invoicing for Compliance in the Accounts Payable Process

HUB HUB

EDI

PDF/email

Digital

Signature

Validation

ERP (FI/AP)

SAP

SAP

SAP SRM

Supplier

Hubs and Portals

Payment

iDOC + supporting

docs (e. g. signature,

verification protocol)

SAP E-Invoicing

for Compliance

HUB

SAP

Archiving

by

OpenText

Document Archiving & Viewing

Document

Scan

Fax

Paper

Email

OCR

Option by

OpenText

SAP

Invoice

Mgmt by

OpenText

Invoice

recognition

Optional

SAP E-Invoicing for Compliance in the Accounts Receivable Process

Compliance

Checks

Archiving

(optional) 2.

3.

3.

Digital

Signature

Validation

SAP E-Invoicing

For Compliance

by Crossgate

1.

SAP

SAP ERP

Billing Data

Customer

B Hub

Customer

A

Email + PDF EDI EDI

Archiving

(optional)

multiple outbound

options

Customers are Realizing Substantial Value with

SAP Solutions for E-Invoicing

ÖAG is an affiliated company of Wolseley plc.

Austria’s biggest wholesaler and distributor of plumbing and heating supplies

Approx. 800 employees

Total turnover EUR 300m per year (2010/2011)

83 branches located all over Austria

SAP since 2007

Cooperation with Crossgate since 2009

FSE OB10

Eurolog

PGS Crossgate

Internal arrangement was not satisfactory

Two-tier selection process

Main selection reasons: ◦ Offering and pricing (the only provider

with all EDI processes plus E-Billing)

◦ Cooperation with SAP

◦ Best customer liaison and support

◦ Most transparent charging method

FSE OB10

Eurolog

PGS Crossgate

Outbound ◦ Initial situation

~ 80.000 invoices per month via post

~ 1 million invoices per year via post

~ 17.000 invoice recipients

◦ SAP® E-Invoicing for Compliance by Crossgate

◦ PDF document with qualified electronic signature

◦ 3rd party verification protocol

◦ eRollout Portal / first contact to customers

Inbound ◦ Initial situation

~ 16,000 incoming invoices/month

~ 1,700 suppliers

◦ SAP® Information Interchange by Crossgate

◦ EDIFACT format from suppliers

◦ Communication from Crossgate via IDOC

◦ EDI (+ PDF document) + monthly statement

◦ Plausibility check – automatic clearing

Outbound ◦ 2,500 customers now use E-Billing

(invoice quota ~ 20 %)

◦ Packed in ZIP-file – later one document per e-mail

◦ Fiscal aspects problematic (uncertainty)

◦ Intense initial customer support

◦ Internal processes and communication very important

Inbound ◦ 14 suppliers live (invoice quota ~ 20 %)

◦ 31 in pipeline

◦ Order references need to be correct

(order number, position number, article codes...)

◦ Test-phase crucial for success

Cost reduction ◦ Printing/paper/postage costs

~EUR 25.000/year*

~EUR 360.000/year^

Faster delivery via e-mail / earlier payments

Storage of invoices

Competitive advantage with automatic E-Invoicing for our customers

Reduction of paper usage (approx. 4 trees+)

* Resource: Business case ÖAG AG

^ Savings potential 3 EUR/invoice with handling costs (resource: Accenture) + 1 tree = 80.500 sheets of paper (http://science.howstuffworks.com)

Reduction of errors from OCI (automatic EDI)

Reduction of handling time (could be up to 100 %)

Cost reduction ◦ Employee costs (~EUR 50.000/year)

Master data quality

Customers are Realizing Substantial Value with SAP Solutions for E-Invoicing

100% secure and compliant e-Invoicing

Considerable cost savings and optimization of processes

Transparency along the whole process

1,100 Dealers within 7 Weeks

Easy and rapid entrance to e-Invoicing

Achieved and maintained a 100% Customer retention rate

Experienced a corollary 5% productivity improvement in credit and receivables

Achieved 20% to 50% reduction in bad debt risk, and 20% to 40% faster access to information

10% to 20% reduction in time needed to collect credit information and enter data prior to a sale

What Does This Mean for Your Business?

Financial Operations

Ensure compliance in all relevant countries

Meet sustainability goals by driving paperless business networks

Increase productivity so staff are focused on activities that add the most value

Receivables

Reduce Days Sales Outstanding (DSO)

with automated e-billing processes

Reduce cost of receivables processing

while ensuring timely invoice delivery to

customers

Payables

Achieve invoice processing cost reduction,

maintain accuracy and capture more

discounts

Pay vendors on time and accurately,

improving vendor relations

Top Executive Issues

Manage Costs and Complexity NOW, without Compromising the FUTURE

Simplify landscape by eliminating point to point

integrations; rich content repository of partners

Extend the value of your existing investments without

rip/replace; Minimize exposure to risk of/process

breakpoints; ensure compliance and regulations

Fast start with predictable costs

Consistent foundation that

enables you to connect ,

transact, collaborate with

a collaborative business

network at the speed of

business

+ +

Now Future

SAP Value Engineering and Team Analysis

Manage

Complexity

Manage

Change Manage

Costs

Line of Business Technology CXO

Easy to Connect: Instant Access to an Open, Industry-optimized Global Business Network with 60,000 Global Partners

SAP Business

Network

60,000+ Partners Connect

Transact

Collaborate

Production LSP

Mfg. Warehouse

Supplier

Government Retailer

Distributor Financial

Services

LSP

Bank Others…

YOU

Eliminate expensive point to point connections with Crossgate Content repository

Easy to Extend: Deep B2B Pre-integration within SAP Business Suite for Mission Critical Processes

3rd Party Solutions

SAP Netweaver Process Integration

SAP ERP

SAP Supply Chain Management

SAP Procurement

Other SAP Solutions

SAP and Non-SAP Solutions

Warehouse

End customer

Financial

Services,

Government

Logistics

Service

Providers

and Carriers

Retailer

SAP and Non-SAP Solutions

Financial

Services,

Government

Production

sites

Suppliers

Logistics

Service

Providers

and Carriers

Outsourced

Manufacturers

Orders In-/Outbound

Orders Ack. In-/Outbound

Invoice In-/Outbound

ASN In-/Outbound

Delivery Forecast In-/Outbound

Remittance Advice In-/Outbound

Delivery JIT In-/Outbound

Inventory Report In-/Outbound

Self Billing Invoice In-/Outbound

Shipment In-/Outbound

Enterprise Service

Other Processes, Docs, etc.

Crossgate Crossgate

Leverage Ready-to-run B2B content maintained over lifecycle

Thank You!

Contact information:

Frank Ruland

CROSSGATE Director, Line of Business Solution,

Stand S-41 Business Networks and B2B

King’s Suite SAP AG [email protected]