Creating Efficiency Savings with eInvoicing

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Creating Efficiency Savings with e-Invoicing

• Local e-Gov Expo
• 21st April 2005

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(left to right) John Moore, Director of Financial
Services Carl Les, Portfolio Holder for
Corporate Affairs Peter Wallis, MD of Wallis
Business Services
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Topics for Discussion

• North Yorkshire County Council Introduction
• What is OB10?
• Handling e-Invoices (InvaPro)
• Enrolling suppliers on OB10
• Achievements

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Introduction to North Yorkshire County Council
(NYCC)

• Purchasing highly devolved
• No corporate ordering / purchasing system
• Advice from Northern Procurement Group Ltd
• Operate core Oracle Financials
• Schools out of scope

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NYCC Base Position

• Base 210,000 invoices p.a. from 20,000 suppliers
• Top 250 suppliers cover 125,000 invoices
• 95 of suppliers submit less than 50 invoices

• CONCLUSION Huge potential to
• Reduce paperwork
• Rationalise suppliers

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The Business Case

• Cost saving on invoice processing
• Real reductions in central costs
• Freeing up time in directorates
• Improvement to BVPI8
• Higher invoices paid within 30 days
• More satisfied suppliers
• e-Gov priorities
• ODPM Priority outcome R9
• Government drive for UK advantage

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The Business Case (cont)

• Catalyst for reviewing payment process
• Streamlined invoice handling
• Increased visibility to procurement issues
• Availability of management information
• Which staff buy what from whom
• Builds a picture of procurement
• Return on Investment
• ROI within 12months

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What is OB10 ?

• Data flow
• Submitting data - suppliers
• Retrieving data - NYCC
• NYCC supplier benefits

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OB10 e-Invoicing data flow
Supplier Submits Invoice to OB10
OB10 Process Invoice
Download Data HTML
NYCC Invoice Distribution System
Load Invoice to Oracle
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Submitting Data - Suppliers

• OB10 will take data from ANY system
• OB10 Desktop tool
• OB10 On-line Invoice Generator
• Supplier feedback
• - Very Straight Forward
• - Very Simple, when I got my head around the
  concept
• - Some scenarios required system changes

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AutoConnect
OB10 web servers
Internet
Files transferred to/from ob10 web servers over
HTTPS / SSL data connection
Accounts system
Invoices directory
OB10 Auto-connect (Web)
Exported files
Files picked up by Browser-bot
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Benefits NYCC Supplier

• Efficient process reliable auditable
• Reduction in risk losing invoices etc
• Better resource utilisation
• Builds relationship Customer Supplier
• Simple easy adoption

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Handling e-Invoices - InvaPro
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InvaPro Invoice Approval System

• Workflow application accessible across the
  Council
• On-line invoice coding, certification
  authorisation
• Daily e-mails Nagging approach
• Who currently owns invoices
• Audit of invoice status history
• Comprehensive reporting

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InvaPro - Does what it says on the tin

• Separate Administration access to control
  configuration set-up
• Data clear out facility to allow testing
  different set-ups
• Utilise current technology knowledge (SQLServer
  IIS)
• Not an all singing dancing tool 8020
  approach
• Not an extortionate price

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Role Out

• Consultancy to transfer knowledge DIY
• Tested several different set-up / configuration
  to find the optimal solution
• 8020 approach Looked for exceptions
• Business processes defined as knowledge improved

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Role Out

• Identified Champions Administrators
• One day training for Administrators
• Train the Trainer approach
• 30-40 minutes training for end users
• Champions used as communication network

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Communications

• Regular e-invoice champions meetings
• Internal awareness via presentations workshops
• Weekly Conference calls OB10, CMS NYCC
• Ad hoc meetings - Sponsor Project manager

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Remember the VAT man

• NYCC VAT Officer was part of team
• Investigate the VAT Processing Reporting
• Non recoverable, Partial recoverable, VAT only
  invoices
• e-Invoicing WILL impact any manual VAT working
  practices and so will need changing

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Supplier Enrolment
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Initial Planning

• Agreed approach between NYCC OB10
• Initial requirements (per supplier)
• name and address
• Contact details
• number of invoices
• total value of invoices
• Focus efforts on appropriate Suppliers
• OB10 Supplier Analysis

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Supplier Invitation

• Types
• Proactive Driven by OB10
• Reactive - Supplier response
• Strength of Message
• Phasing
• Phase 1 - Top 150 End of April
• Phase 2 - Next 180 Start of June
• Phase 3 - The rest Mid July

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The Chase is On

• OB10 contacted suppliers 5 days after letter was
  sent
• Regular reports from OB10
• Joint NYCC and OB10 seminars
• Referrals process (NYCC e-invoice champions)
• Follow up process via e-mails

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Supplier Progression
Sales in progress
File promised
Refer to buyer
Promised IG
Work in progress
Ready to transact
Signed IG
Live
Reject
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Suppliers Reasons for Refusing to Join
Valid
Ify
Invalid

• No computer
• Not on internet
• Recently lost contract

• Upgrading accounting systems
• Awaiting re-letting of contract
• Lost business to a competitor
• Too expensive
• Up to Head Office

• Prefer to send us a spreadsheet
• Will join if X, Y and Z join
• Accounting system is unique
• Not appropriate for a charity
• Waiting until A returns

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The NYCC e-Invoicing Project

• What has been achieved

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Achievements

• Improvement BVPI8
• Paper invoices drop 91
• e-Invoices 98
• Utilised data for negotiating new contracts
• Office supplies
• Encourage e-business
• Over 100 suppliers signed up
• Additional 25 suppliers committed

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Achievements

• Improved process
• Only 2 points of contact per e-invoice
• Suppliers NYCC staff using PO/reference numbers
• Internal Audit
• Grade Good / Satisfactory / Weak / Unsound
• Recommendations Essential / Important / Useful
• Staff prefer e-invoices

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Business as Usual

• e-Invoicing procedures parallel to paper
• Required for new contracts new suppliers
• No longer a Project Controlled by operational
  staff

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Progress To Date

• Current Live suppliers 21,000 invoices for
  05/06
• Additional 23,500 invoices coming on-line early
  05/06
• Target 55,000 in 05/06 and 85,000 06/07

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Suppliers Lessons for NYCC

• The customer doesnt come first for many
  suppliers
• Some dont know how much business they are doing
  with us
• Being a prompt payer doesnt help your case
• Never make assumptions about who will/wont join
• Mixed messages abound
• Not enough supplier analysis
• Lack of clarity re coping with attachments

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What Next?

• Building Design Maintenance
• Large volume of invoices
• Current system review
• OB10 is in all new tenders issued
• Detailed agreement with Supplier on invoicing
  process
• Take on expanding social services invoice volume
• DSO Catering Suppliers benefits via Ingredient
  costing system
• Benefit from inclusion of OB10 in TCs
• New Proactive Campaign later in 2005

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Change Managementand e-Invoicing

• Converting people involves more effort than
  converting technology

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Creating Efficiency Savings with e-Invoicing

• Question Answer Session