LOSING THE OPERATOR: HOW EIPP SOLUTIONS CHANGE THE

FACE OF PAYABLES

You know when you have an argument and it just sort of sits with you for a while? Like a

berry seed stuck in between your teeth? I’m still stuck on these quasi-automation solutions

I see in the ELECTRONIC INVOICE PRESENTMENT AND PAYMENT marketplace. I was reviewing an

ELECTRONIC INVOICE PRESENTMENT AND PAYMENT (EIPP) application that had developed all these

great tools for the AP CLERK. It’s irritating. Why are we enabling an obsolete position?

Yes, everyone loved the elevator operator. And it was a pretty important position when

elevators were operated by gears and levers, but does anyone really think that position is

relevant today? Once the technology advanced to the point that anyone could operate it,

the need for the elevator operator disappeared.

The fully automated EIPP solutions of today are like elevator buttons. Yes, you still need an

administrator for the whole system the way you still need elevator technicians that make

sure everything is working. However, there’s really no need to have an AP CLERK looking at

every invoice and clicking on the screen on

behalf of the supplier and buyer who can

click on the screen just as easily

themselves.

EIPP has gotten that simple.

Fully AUTOMATED

PAYABLES with EIPP enables the buyer and

the supplier to complete

the INVOICING process without

a PAYABLES clerk (assuming we’re

excluding inferior solutions). With a fully

automated EIPP solution, any of the

processes you’ve taught your AP

STAFF can be configured into

your EIPP system. A fully automated

EIPP solution knows your PO

MATCHING rules and tolerances, it knows

your APPROVAL ROUTING rules with exceptions and special processing, it knows how to re-

route approvals based on vacation and proxy situations even better than your AP

CLERK knows.

And a fully automated EIPP solution doesn’t do anything on accident. It doesn’t mis-key an

amount after everything’s approved. It doesn’t forget that the particular project code

needed additional approvals. It doesn’t just bypass duplicate detection rules when it’s

“pretty sure” it’s not a duplicate invoice. It can calculate DYNAMIC DISCOUNTS and offer them

to qualified suppliers. It’s available 24/7 to give suppliers and buyers status of any invoice

as well as a description of all MATCHING activities and all approvals processed and pending.

Creating tools for the AP CLERK is akin to manufacturing elevator chairs for the elevator

operator to sit on. For the AP CLERK, it’s really just insulting. If they’ve been around a while,

chances are they can think of much more productive things to do than keying, stapling, and

answering supplier inquiries. Automate the mundane tasks and let them work on contract

audits.

Move them to another department. Train them in asset management. Try them in other

accounting positions. Just make sure that if you’ve received mandates from your executive

team to cut costs and eliminate waste that they don’t show up and see an elevator operator

sitting in a chair asking them “what floor?”

ELECTRONIC INVOICING- THE TIME HAS ARRIVED

I was speaking at a conference recently on ELECTRONIC INVOICING, and a question was posed

to me, “Doesn’t this mean that we will lose head count in my department?” an AP

SUPERVISOR asked. This is a question that often arises, and it is truly a worthy consideration.

ELECTRONIC INVOICING will necessarily reduce the effort in a typically AP DEPARTMENT (assuming

you are using a quality ELECTRONIC INVOICING provider). These efficiency gains are in the area

of keying data into an ERP, communicating with vendors over when they will get paid, or

what the check number for the remittance was, answering questions regarding PURCHASE

ORDERS that do not match up with the invoice, etc.

These are good things to have removed from ACCOUNTS PAYABLE, but that can often lead to

not needing as many people in that department. Typically this is handled with moving the

valuable individuals to other areas to work, but they are still no longer under the hierarchy

of the AP MANAGER. Most people would see this as a good thing, but there are a few that will

avoid ELECTRONIC INVOICING initiatives solely because they do not want to lose staff. They

view the number of people they have working for them as a status symbol or even a job

security issue.

In reality, these individuals are looked at with a target on their back due to a lack of forward

thinking and resourcefulness that companies require in this economy. By looking into finding

and implementing a great ELECTRONIC INVOICING solution, they are actually growing their

stature in their organization and well as receiving all of the benefits that are obtained

through receipt of ELECTRONIC INVOICES. This will give them the ability to rise in the

organization, or at least ensure their value to the organization, which equates to job

security.

Conversely, those who choose not to look into ELECTRONIC INVOICING may be significantly

limiting their usefulness to their company. Executive are looking to make sure that they

have the right individuals in the key positions in their company, and those who have

initiated an ELECTRONIC INVOICING measure are typically recognized as having a solid impact

on the organization. Not just in efficiency gains, but in cash opportunities that would never

be realized otherwise.

I spoke with an AP MANAGER after my last post and they informed me that they had heard

that the Finance Director that they fell under was going to be leaving the company. This

individual is now up for a promotion, (as well as their superior) due in no small part to the

success of their IMPLEMENTATION of ELECTRONIC INVOICING (E-INVOICING) with IPAYABLES. This

project touches many in the organization, and truly made AP stand out as a group that is

helping the company achieve their goals!

DYNAMIC DISCOUNTING – IT’S NOT ROCKET SCIENCE

Going back to one of my EARLIER POSTS, I talked about the numerous benefits that ELECTRONIC

INVOICING brings. One of these benefits is called DYNAMIC DISCOUNTING. ACCOUNTS PAYABLE in the

past was seen as primarily an expense area and not as a profit center. ELECTRONIC

INVOICING and the new opportunities it provides are helping to change SUPPLY CHAIN FINANCE.

Traditional paper-based invoicing can result in invoice processing delays which can make it

nearly impossible to take discounts. When terms are 2%10, what are your options when the

invoice isn’t approved and processed until day 30 or even day 11? This isn’t to say you

have to take the discounts but having the option allows your organization greater flexibility

to maximize the value of the terms already in place and allow more discounts and profits to

accrue to you.

So let’s take a step back to the basics. DISCOUNT TERMS. Take that ever popular 2% 10 Net

30. It’s a great deal. If you have another place to put your money for an extra 20 days

that provides a better return, I would really like to be your friend. This is just one of many

DISCOUNT TERMS available. Discount terms are really a win-win for both parties. SUPPLIERS get

paid early and you get a discount. Our friends in PROCUREMENT have negotiated this discount

so let’s enjoy the benefits of their labor. Now I do understand the importance of CASH FLOW

FORECASTING and maintaining the appropriate WORKING CAPITAL. I’m not suggesting one raids

working capital in order take discounts on everything putting your CASH FLOW in jeopardy.

Prudence and balance are always in order. But why leave money on the table? With that

being said, so what is DYNAMIC DISCOUNTING? Standard Discounting is rather rigid. You get a

2% discount if you pay before 10 days and 0% after 10 days. It is the all or nothing

deal. Miss the train and you’re out of luck.

DYNAMIC DISCOUNTING however provides greater flexibility and more options in case you miss

the 10 days but would still like to take advantage of the DISCOUNT. This discount percentage

is on a sliding scale which decrease with time so both the benefits are still available but on a

flexible (A.K.A DYNAMIC) scale. It also provides a more reasonable approach for suppliers

where 2% at day 10 is ok but not 2% at day 20 or 25. The more suppliers which agree to

offer up discounts, on this sliding scale, the more opportunities ACCOUNTS PAYABLE has to

add PROFIT CENTER into the benefits they provide. The great thing about DYNAMIC

DISCOUNTING is that it isn’t rocket science or a complex Derivative trying to securitize a

revenue stream from your grandma’s cookies.

It’s the same DISCOUNTING you have been doing for years but with a lot more flexibility. In

addition, you will not be the first to use this as many companies are currently increasing

their capturing of DISCOUNTS via DYNAMIC DISCOUNTING. So rise up and take

those DISCOUNTS. Watch FORECASTING CASH FLOW’ In’ instead of ‘Out’. Seize the opportunities

that are available to SUPPLY CHAIN FINANCE in greater abundance today than yesterday

because of ELECTRONIC INVOICING.

Tags: ACCOUNTS PAYABLE, CASH FLOW, DI

OUTSOURCE ACCOUNTS PAYABLES? OUTSOURCE YOUR

CEO INSTEAD.

So you really can’t outsource your CEO, but today as we chatted here at iPayables about AP

OUTSOURCING our CEO, Ken Virgin, was being a smart aleck so I jokingly said “We should

outsource you.” OUTSOURCING your CEO, VP of Sales or COO is laughable on its face (we did

have a good laugh) because these positions are valued for their strategic thought,

determined execution and the leadership they bring to the organization.

Even if one of these positions is costing you a lot of money and could be done more

efficiently elsewhere you’re not likely to even consider it. The same is true to the majority

of the folks working in ACCOUNTS PAYABLE DEPARTMENTS in most companies. It’s just

sometimes hard to tell since they are buried under a mountain of paper and inundated with

endless vendor phone calls.

The rationale usually goes something like this: If I SCAN all my PAPER INVOICES and have folks

in Bangalore or Shanghai key them and reroute the phones to India or China I’ll save a

bundle of money. The truth is you will save some cash. The question is at what cost to

vendor relations, company reputation and overall efficiency. ACCOUNTS PAYABLES can be like

veins in the circulatory system. Not always valued for their contribution, vital to overall

health and quite a pain if something goes wrong. The real question that smart companies

are asking themselves is “why is there cost and inefficiency in AP and what can I do about

it”. Especially companies that already travelled the AP OUTSOURCING road.

The answer of course lies in the AUTOMATION of ACCOUNTS PAYABLE. More and more companies

are untying the PAYABLES OUTSOURCING knot; automating the capture, WORKFLOW, MATCHING,

and payment of invoices and unlocking the intelligence and capabilities of their AP

staff. These companies have realized that paying someone to key invoices – even at

outsourced rates – is not the answer. AUTOMATE, AUTOMATE, AND AUTOMATE.

PLEASE DON’T PRETEND IT’S ACCOUNTS PAYABLE AUTOMATION

I’ve heard a few awkward stories of people “pretend automating” their payables

department. Their people are still doing basically the same jobs and they still face most of

the same challenges that they always have. My fear is that many ACCOUNTS PAYABLE groups

today feel that PAYABLES AUTOMATION consists of one or two tools you buy: a SCANNER,

a WORKFLOW solution, a place for vendors to look at their invoice status. Maybe they feel

pressure to tell their boss that they’re AUTOMATED or maybe they really just don’t know what

it means. There is a cold, cruel way to tell if you’re automated. Think of what automation

means in the auto industry. It’s not factory workers wearing robot costumes or walking

around with special tools. The cold truth is if someone’s job is automated, they’re not there

anymore.

Any ACCOUNTS PAYABLE GROUP that still has basically the same clerks as before entering data,

coding invoices, reviewing signatures, MATCHING PURCHASE ORDERS, or answering invoice

status calls, just can’t claim to be AUTOMATED. I’ll also call out ACCOUNTS PAYABLE

DEPARTMENTS that switch people from keying into SCANNING, or OUTSOURCING the whole

department to a different group of people. Not PAYABLES AUTOMATION. Even if you have

everything imaged and your clerks don’t have paper, they have images that they’re coding

into the AP SYSTEM. Not AUTOMATED. Also, while using some efficiency tools are a great start,

tools by themselves are not ACCOUNTS PAYABLE AUTOMATION. I knew a company that received

a large number of EDI INVOICES, which was great. They printed them out on paper and keyed

them into their payables system, which is not so great.

A fully AUTOMATED SOLUTION should start with ELECTRONIC INVOICING from as many suppliers as

possible (so include EDI, WEB ENTRY, FILE UPLOAD,PO FLIP) and throw in a scanning post office

box to catch the remaining paper scraps. PO MATCHING should happen as the supplier is

entering the invoice so they can resolve issues before they even submit the invoice. Status

of the invoice is available to the supplier through every step of the process.

WORKFLOW routes invoices to the person who order the goods for coding with all the

validations and controls necessary to ensure it is done properly and is forwarded to the

various approvers after that based on the controls defined by the company. Disputes are

resolved online between the supplier and the buyer. In an AUTOMATED environment, ACCOUNTS

PAYABLE DEPARTMENTS don’t touch invoices, they don’t look at invoices. They monitor the

flow, administrate the system, maybe handle exceptions, but all of the traditional clerk

activities are automated. Maybe payables automation isn’t for everyone. I worked with one

company that turned it off after the epiphany. In their words, “If we do this, she won’t

have anything to do”. Not until after they implemented, did they really understand what

real AUTOMATION meant.

PAYABLES AUTOMATION doesn’t need to be cold and cruel. Most of our clients have created

internal audit groups or just moved people into unrelated positions. Every organization

needs to determine when they want to AUTOMATE PAYABLES. Eventually, it will be an efficiency

requirement of every organization. It is wonderfully efficient and provides visibility and

control as never before. However, there will be companies that just aren’t comfortable with

it yet. Or the companies that aren’t comfortable yet, I can understand, but please, don’t

pretend to be automated if you’re not.

AP AUTOMATION: ADVICE FOR BEGINNERS

Researching ACCOUNTS PAYABLE AUTOMATION or complete ELECTRONIC INVOICING, can be a little

overwhelming. You start out wanting to learn about how a supplier can key an invoice into

a portal and soon discover that WORKFLOW, SUPPLIER STATUS DISPLAY, and DISPUTE

RESOLUTION can really change your world for the better. Then you hear about the great

adoption success that comes with professional SUPPLIER ADOPTION services and how remaining

paper is sent to a PO Box where it is converted to electronic and you begin to see the big

picture of how pretty much everything in PAYABLES can be automated.

Along with your research you may hear warnings about the negative impacts of SUPPLIER

FEES or the complexities of setup or configuration. Throw in some discussion of DYNAMIC

DISCOUNTING and it can lead to a realization that this is going to be a bigger project than

originally anticipated. So what are your options now that you really want this, but it’s a

bigger scope than you originally anticipated?

1. Delay. That’s what a large number of companies do. It’s not that the price tag

for AP AUTOMATION has changed, just the effort and buy-in required to get it

done. Maybe you’ll have enough time next year. (Hint: this isn’t the best

strategy)

2. Go with a well-marketed do-it-yourself solution. This is better than the first idea,

but there’s a good chance it’s going to take a lot longer to get setup and probably

even have to hire a consultant. And what sort of impact are the SUPPLIER

FEES going to have on the supplier adoption efforts you have to do yourself, not to

mention the supplier relationship? The problem with the heavy marketed solution

is that the cost of that marketing shows up in higher price and less service.

3. Go with the full-service solution. Oftentimes, the full-service solutions (such

as IPAYABLES) are growing on reputation instead of marketing. This is great for

the companies that can find these solutions. The cost is usually less, and the

service provider basically runs the project until you’re up and going. The full-

service solutions will often also contractually guarantee time lines and adoption

rates. But because there is less marketing material about them, it’s a good idea

to check references to validate their offerings.

4. Obviously, I push for the third option. The second option can work, but it can be

a little riskier and usually quite a bit more expensive.

ACCOUNTS PAYABLE AUTOMATION has so much to offer. Delaying is just not a reasonable

option. If you’re experienced with PAYABLES AUTOMATION, and you’re being pressured into the

higher priced do-it-yourself solutions, it’s not the end of the world. You can still make them

work, it’s just more effort. But if you’re new to PAYABLES AUTOMATION or if no one is trying to

force you down one path, then go with a full-service solution that will guarantee your

success.

THE ULTIMATE CASH DEVISE WITH E-INVOICING

DYNAMIC DISCOUNTING or EARLY PAYMENT can be

the ultimate cash management device when

using E-INVOICING. As described in Wikipedia,

cash discount reduction is “a price given by

the creditor to the debtor is known as cash

discount. This discount is intended to speed

payment and thereby provide LIQUIDITY to the

firm. They are sometimes used as

a PROMOTIONAL device.” An example of a

discount is as follows 2/10 net 30 – this

means the buyer must pay within 30 days of

the invoice date, but will receive a 2%

discount if they pay within 10 days of the

invoice date.

6 COMPELLING REASONS FOR EARLY PAY

1. BETTER DISCOUNTS – APPROPRIATE COSTS ARE DETERMINED FOR EARLY PAYMENT

WHICH COORDINATES WITH SUPPLIER’S REQUIREMENTS. SUPPLIER AGREES TO THE DISCOUNT AND CAN

LOOK FORWARD TO A PAYMENT THAT MEETS THEIR SCHEDULE.

2. GUESSWORK IS ELIMINATED - A SCHEDULED PAYMENT IS SUBMITTED IN A TIMELY MANNER. THE DATE THE

PAYMENT WILL BE MADE IS SELECTED AND CARRIED OUT.

3. STRONGER BUSINESS RELATIONSHIPS ESTABLISHED - BUYER AND SUPPLIER ARE ABLE TO WORK

TOGETHER WHILE IMPROVING CAPACITY FOR FUTURE AFFILIATIONS.

4. IMPROVES EQUITY - IN THE ABOVE EXAMPLE RETURN ON CAPITAL IS 36%.

5. REDUCES THE COST OF DOING BUSINESS – FOR SUPPLIERS CREDIT IS EITHER DIFFICULT TO SECURE OR

EXPENSIVE. BY LEVERAGING THE POWER AND FLEXIBILITY OF DISCOUNTING, THEY CAN CREATE AN OPTION

THAT REDUCES PRICES, REDUCES THE COST OF BORROWING AND ULTIMATELY – REDUCES THE COST OF

DOING BUSINESS.

6. CUTS OUT THE MIDDLEMAN COSTS – BY DEALING DIRECTLY WITH SUPPLIERS ALLOWS A DISCOUNT WITH NO

MIDDLEMAN INVOLVED.

Recently one of the World’s Largest Restaurants was asked to give their feedback on how

well they were able to incorporate EARLY PAY into their ELECTRONIC INVOICING system. Included

are some of the questions and answers.

QUOTES FROM IPAYABLES USERS CONFERENCE 2012

Just a follow up to the conference, here are some comments from attendees:

IT WAS TIME WELL SPENT.

EXTREMELY BENEFICIAL AND VERY INFORMATIVE.

I THOUGHT THE CONFERENCE WAS GREAT AND IT WAS NICE TO HAVE OTHERS INVOLVED.

I CAME AWAY FEELING VERY POSITIVE AND MOTIVATED!

THE INFORMATION YOU GUYS PROVIDED WAS VERY USEFUL AND HAVING THE OPPORTUNITY TO NETWORK

WITH OTHER USERS OF THE IPAYABLES SYSTEM WAS EXTREMELY VALUABLE TO ME. I HOPE YOU KNOW HOW

MUCH WE APPRECIATE THE SUPPORT WE GET FROM THE FOLKS AT IPAYABLES, AND THE VALUE I PLACE ON

OUR PARTNERSHIP.

Again, if you are a client the missed the conference, or if you are considering doing PAYABLES

AUTOMATION and just want to see what discussions we had, let me know and I’ll send the

conference notes.

BEST PRACTICES FOR ACCOUNTS PAYABLE AUTOMATION

FROM REAL CUSTOMERS

A few weeks ago, we held our 2012 User IPAYABLES Conference in Dana Point, California. It

was a great event with beautiful weather and great discussions about best practices

in PAYABLES AUTOMATION. The focus of the conference was a discussion of best practices

around the following topics:

INTERNAL CHANGE MANAGEMENT

SUPPLIER ADOPTION

DYNAMIC DISCOUNTING AND CARD

I liked that one customer described approvers and suppliers as “non-compliant” if they

weren’t invoicing electronically. It was in all their communications, so it was very clear that

the PAYABLES AUTOMATION initiative was not voluntary. I’m actually compiling all the best

practice discussions into a short white paper. If you’re interested in ACCOUNTS PAYABLE

AUTOMATION best practices, you might want to request a copy from me

(KEN.VIRGIN@IPAYABLES.COM).

YUM! BRANDS & ELECTRONIC INVOICING

I had the pleasure of co presenting a webinar this week with Dave from YUM! BRANDS (they

are better known by their companies KFC, TACO BELL, and PIZZA HUT). Dave spoke about how

they have been extremely successful with ELECTRONIC INVOICING and DYNAMIC DISCOUNTING. They

have seen great improvements in their overall processing of E-INVOICES as well as getting

invoices approved on an average of less than 5 days. They are able to accomplish this

through INVOICEWORKS and our ELECTRONIC INVOICING and WORKFLOW tools. This has enabled

them to reach their goals in converting their suppliers from PAPER CHECK to ACH TRANSACTIONS,

which was an executive initiative. All of these have enabled the ACCOUNTS PAYABLE

DEPARTMENT to be viewed as innovators and forward thinkers as opposed to a back office

necessity.

Another HUGE advance that they have made is with the DYNAMIC DISCOUNTING tools. They are

now bringing in more in rebates than their department spends. This is key when you are

trying to show value as a shared service department. An unexpected perk was the fact that

the Restaurant General Managers are no longer having to field calls from vendors about

invoices and if they were paid or not. This is not one of the job functions that YUM! are

looking for their RGMs to do, they want them to manage profitable stores long term.

Dave did an awesome job, and I am glad that we were able to share what one of our clients

is doing with ELECTRONIC INVOICING and how it has impacted the organization.

GOOD DISCUSSIONS ON PAYABLES AUTOMATION

BEST PRACTICES

At our user conference in July, we presented a few topics for discussion. The goal was to let

customers share their experiences on IMPLEMENTING ELECTRONIC INVOICING and PAYABLES

AUTOMATION. It was a great discussion of the following topics:

INTERNAL CHANGE MANAGEMENT

SUPPLIER ADOPTION

DYNAMIC DISCOUNTING AND CARD

The first discussion dealt with training and encouraging employees to

use INVOICEWORKS. Most of the comments dealt with using executive management

mandates, newsletters and mass emails, and training sessions. My favorite takeaway was

how one group called paper “out of compliance”. So any department that was not using the

new ELECTRONIC INVOICE/PAYABLES AUTOMATION SYSTEM was out of compliance. Obviously, nobody

likes to be out of compliance, so employees and key players changed their behavior and

started using INVOICEWORKS to receive and approve invoices.

The second discussion dealt with encouraging participation from SUPPLIERS. Aside from the

various comments on how to get suppliers to send INVOICES ELECTRONICALLY, it was good to

see the success rates customers had. Over 78% of customers were near or had exceeded

their supplier adoption targets. The other 22% walked away with some best practices to

incorporate. The third discussion point was more like two mini-case studies from

YUM and DELTA AIR LINES. YUM shared their stories of success with IPAYABLES ELECTRONIC

INVOICING and DYNAMIC DISCOUNTING and DELTA AIR LINES talked about their success

using INVOICEWORKS to pay ELECTRONIC INVOICES with AMERICAN EXPRESS.

The comments from the conference seemed so valuable that I compiled them into a white

paper. It’s only about four pages long, but it gives good insight into how these companies

really made ELECTRONIC INVOICING and PAYABLES AUTOMATION work for them.

Check out the white paper at our site: HTTP://PAGES.IPAYABLES.COM/WHITEPAPER.HTML

Let me know if you found anything useful in the whitepaper.

E-INVOICING, ARCHIVING AND REPORTING

While the main reason to ARCHIVE invoices deals with regulatory and audit issues, having a

separate and long-term storage of invoices and related data enables a much sought after

and complimentary product, AD-HOC REPORTING. Ken Virgin, CEO, who introduced the new

system said, “With the traditional PAYABLES AUTOMATION system, you are limited on the

reporting you can do. Transaction processing systems have restrictive parameters that

restrict reporting capabilities.

In other words, good reporting used to mean a slow system. By introducing

online ARCHIVE, IPAYABLES offers users the ability to create any report, as simple or complex

as desired, with no performance impact on the original system.” IPAYABLES ONLINE ARCHIVE is

offered as a service, so there is no hardware or large technology effort. “IT departments

look like the bad guy for not letting authorized employees get to the data they need, but, in

reality, they have to protect the performance of their systems. “IPAYABLES ONLINE ARCHIVE is

an affordable and easy way to protect the system performance while allowing authorized

employees the complex reporting access to data they need.” said Jon Titel, CTO iPAYABLES.

The web interface allows for a simple search of the original invoice and related data (invoice

image if applicable, audit trail, approval/processing time stamps and supporting

documentation), as well as the more robust ad-hoc reporting capabilities where users can

use query tools or even direct SQL queries to create complex reports.

Data is archived close to real time, so reporting can be applied for audit or for more current

needs such as liability reporting. Because it is web-based and is not user seat priced, any

authorized user in the organization can access it and/or export it.

KEY FEATURES:

I. SECURE, FAST and ALWAYS AVAILABLE. Designed to ensure maximum availability as

well as excellent performance. Standard backup processes deliver the security

and peace of mind that your data will be available when you need it.

II. ARCHIVE only what is required. With IPAYABLES ONLINE ARCHIVING the data is only kept

for the duration of time you request. If internal auditing or regulatory

requirements are necessary, you can quickly make the adjustments by

eliminating or start retaining those documents whenever needed.

III. AFFORDABLE. IPAYABLES economies of scale and expertise allow for premium

features at a reasonable price.

EIPP AND P2P – THAT LAST “P” IS FOR “PAYMENT”, RIGHT?

EIPP is ELECTRONIC INVOICE PRESENTMENT AND PAYMENT. P2P is PROCURE TO PAY. Sounds simple

enough that you would want to automate the entire ACCOUNTS PAYABLE process.

Unfortunately a recent independent market survey found that many EIPP or P2P providers

don’t actually provide payment services or even connects to payment services as part of

their standard business model. The response most often received was “If the customer

really presses we could partner with so-and-so.”

This glaring omission from the EIPP feature set is pretty surprising. It is true that many

enterprise customers are not looking to outsource payment processing but to not have an

integrated, robust payment offering as part of your EIPP toolset is short-sighted.

One of the first indirect benefits of automating the ACCOUNTS PAYABLE process is the

decreases approval or match time and hence the larger window for discounts or P-

CARD payments.

This expanded window of opportunity enables both customers and suppliers the chance to

negotiate real time discounts that meet their business needs. SUPPLIERS are much more

willing to take PURCHASING CARDS as PAYMENT, even though they pay a transaction fee,

because they are confident that those payments will be significantly early.

Unfortunately ERP SYSTEMS are not built to take advantage of these advanced payment

options and this is where a robust EIPP provider can step in with their payment capabilities

and deliver the added value.

An EIPP provider that hasn’t integrated payment into its software, services and processes is

going to have a hard time delivering these benefits, even if the “customer really presses”.

IPAYABLES advanced payment capabilities have been used by its customers for almost a

decade. If complete ACCOUNTS PAYABLE AUTOMATION is what you’re looking for then make sure

that last “P” in EIPP and P2P is real. No sense in going with a pretender.

EARLY INVOICING TO 21ST CENTURY E-INVOICING

Today I wanted to explore when INVOICING first started way back in the 1st Century. I’ll also

take a brief snap shot of what one of George W’s INVOICES looked like in the 18th century

and then discuss what an EINVOICE can do for an organization in the 21st Century.

INVOICING CAN BE TRACKED ALL THE AWAY BACK TO THE MESOPOTAMIAN CIVILIZATION (THE

CRADLE OF CIVILIZATION) WHERE THEY KEPT TRACK OF BUSINESS CODE STRUCTURE AND

GOVERNMENT REGULATIONS FOR COMMERCE. EXPERTS HAVE EVIDENCE THAT PROVES 4,000

YEARS AGO, THE MESOPOTAMIANS CREATED THE CONCEPT OF factoring. FOLLOWING

MESOPOTAMIA, THERE IS EVIDENCE THAT THE ROMANS SOLD PROMISSORY NOTES AT

DISCOUNTED PRICES. ROMAN MERCHANTS ALSO ENLISTED THE SERVICES OF COLLECTORS TO

SETTLE TRADE DEBTS. BUT FACTORING AS WE KNOW IT TODAY GOT ITS START IN THE MIDDLE

AGES.

Fast forward to 1768 and see an INVOICE that

George Washington used to order supply’s for himself

and Martha. GEORGE WASHINGTON sent this INVOICE,

written in his own handwriting, to his agent in

London, Robert Cary & Co., on June 20, 1768.

Washington requests nails, buttons, scissors, linens,

sugar and spices, fishing equipment, red sealing wax,

gloves, shoe buckles, dress-goods, and similar items.

One of the more stylish items on the list is, “1 Mans

best Beaver Hatt.” And for Martha he orders a green

satin quilted petticoat and a handsome winter silk, in

a color other than yellow, to be made into a “Sacque

& Coat for a middle sized Woman.”

This INVOICE is published in W. W. Abbot and Dorothy Twohig, eds., THE PAPERS OF

GEORGE WASHINGTON: COLONIAL SERIES, vol. 8 (Charlottesville: University Press of

Virginia, 1993), 100-102. Fast forward again to 2010 as the major Fortune 500

Companies are saving millions of dollars each year doing E-INVOICING. E-

INVOICING automates ACCOUNTS PAYABLE departments with quality technical

solutions. These solutions ELIMINATE PAPER from purchasing to payment

reconciliation. What used to be manual now is automated. Information is captured and

recorded online.

They are either uploaded into ELECTRONIC INVOICE files or sent to PO boxes

for ELECTRONIC conversion. Either way you never get paper INVOICES. It’s clean and fast

with ELECTRONIC INVOICES being matched for approval. It’s just that simple.

The Mesopotamians started many systems that have shaped our way of life and our way of

thinking. Mesopotamia was the “Cradle of Civilization”, so whatever they did people

watched and listened. During the 18th Century and now into the 21st Century

organizations have also observed and taken heed to improving their bottom line. Today

people are watching and listening as E-INVOICING makes new inroads and helps

improve ACCOUNTS PAYABLE department’s ROI into the next Century.

VISIONS OF AP AUTOMATION DANCING IN THEIR HEADS

TWAS THE NIGHT BEFORE MONTH END and all through the office,

Not an invoice was coming through AP AUTOMATION.

Sticky Notes were stuck on the invoices with care,

In the hopes that an approving signature soon would be there.

The approvers were all snug in their tight little cubicles,

While visions of AP AUTOMATION danced in their heads.

And the CFO in a tie, and me with my clip board,

Had just settled into a meeting on ACCOUNTS PAYABLE AUTOMATION.

When out in the hallway there a rose such a clatter,

We sprang from our chairs to see what was the matter.

Away to the Accounting department we flew,

To see what the heck was so exciting and new.

When what to my wondering ears should I hear?

But chants of “AP AUTOMATION,” to help silence our fears.

When I spied a jolly little elf, from IPAYABLES.

He was jolly and nice and kindly said, “We can help fix your ACCOUNTS PAYABLES.“

“Now Ariba, Xign, Basware and Prodigia, none of them can help you with your AP

AUTOMATION the way that we can.”

“We will get rid of your paper, and put in the best work flow. We will get your invoices

approved before you can know.”

“Now this is all fine A P AUTOMATION, but” I said, “Let’s talk about the things we are most

fearing.”

“Control, or the lack of it, is our biggest fear,

What can iPayables do about that here?”

“Well” said the jolly ole elf, “let’s talk about baseball and put that on the shelf.

Just kidding, just kidding, what I meant to say,

With InvoiceWorks we can come in and save the day!”

ACCOUNTS PAYABLE AUTOMATION is all about efficiency and cost,

It should not include invoices getting lost.”

I said “AP AUTOMATION sounds like the way to go,

And IPAYABLES is definitely the best that we know!”

He left us in good cheer and went to the door,

And entered the elevator to exit our floor.

He waved through the air, and drove out of sight,

“Happy INVOICING to all, and to all a Good Night!

PAYABLES, PAPER AND PURCHASE TO PAY

PURCHASE TO PAY, PROCURE TO PAY, PROCUREMENT TO PAY, P2P, ORDER TO CASH; there is a lot of

terminology which can get confusing, especially when they all refer to the same thing. At

times I feel like I am back at Andersen Consulting (now Accenture) with all of the various

terminology and acronyms which I then needed to explain to clients.

PURCHASE TO PAY essentially covers the world of PROCUREMENT, TIME AND EXPENSE, ACCOUNTS

PAYABLE and PAYMENTS. It’s your FINANCIAL SUPPLY CHAIN. In today’s environment, companies

need to be able to do more without adding additional resources. Initiatives to drive costs

down, improving their processes, reviewing and consolidating their purchases, managing

existing contracts, capturing discounts, etc are common at most companies. The challenge

can seem a bit daunting. You may ask yourself, where do I start? Is this an all of nothing

effort? Can I do this in phases? Can this be done in a few months instead of years? My

recommendation is to start with the invoices coming into ACCOUNTS PAYABLE.

PURGE THE PAPER:

Paper is neither very manageable nor visible. By offering up options which allow suppliers

to provide invoice electronically is the most effective approach. The following options used

together allow 100% of your current paper invoices to be delivered ELECTRONICALLY in a very

short period of time.

WEB PORTAL FOR ONLINE ENTRY FILE UPLOAD FOR VARIOUS COMMON FORMATS EMAIL ACCEPTANCE OF PDFS IMAGING TO SCAN AND INDEX THE REMAINING PAPER

Now that the invoice is ELECTRONIC, additional tools can be added such as PURCHASE ORDER

MATCHING.

PURCHASE ORDER MATCHING:

Why wait until the INVOICE has been sent by the supplier and is being processed by

your ERP to find out there are match exceptions? The majority of the match exceptions can

be handled up front by the supplier before the invoice is even sent. Now I’m not suggesting

that you eliminate or stop the matching that is performed by your ERP SYSTEM as it serves a

very important purpose. The only issue is that match exceptions are found after the invoice

is submitted by the supplier and requires ACCOUNTS PAYABLE and/or PROCUREMENT to deal with

the exceptions. Why not have the match exceptions handled up front by the

supplier? Consider this upfront activity a ‘PRE-MATCH’.

INVOICE TO PURCHASE ORDER (2-WAY)

INVOICE TO PURCHASE ORDER TO RECEIPT (3-WAY)

OR THE MANY VARIATIONS AND CRITERIA THAT CAN BE APPLIED TO MATCHING (BLANKET, CONTRACT,

PLANNED, ETC).

As part of the supplier submitting the PO-BASED INVOICE, such as via a web portal, file load,

email, etc., apply your 2, 3 or other- way match criteria. That way if there is an issue, the

supplier can review and correct it prior to the invoice being submitted. They may need to

adjust the unit price for example or that the quantity being invoiced, therefore freeing up

both PROCUREMENT and ACCOUNT PAYABLE from having to research, call and track down these

exceptions. Plus the supplier experience is improved as they have less payment delays and

issues that they also must work to resolve.

Tackling the whole PURCHASE TO PAY process can best be accomplished by taking these two

steps first. From here additional opportunities will present themselves regarding increased

visibility, workflow, analytics, greater control, etc. Now you have the appropriate tools to

achieve your goals and move your organizations and company forward.

WHY SHOULD YOU CARE ABOUT ELECTRONIC INVOICING – IT’S

YOUR JOB!

There are a lot of people out there that can’t be bothered with the topic of ELECTRONIC

INVOICING. They are set in there ways and things are working as they always have, not

perfect but manageable. You have your AP MANAGER or CONTROLLER thinking that

having ELECTRONIC INVOICES flowing through the organization may sound neat, but it is not

necessary and if there are no changes to the status quo then everything is fine. The

problem is that somebody will introduce ELECTRONIC INVOICING into your organization, and it

better be you so that you can make sure that the ELECTRONIC INVOICES are produced, routed

and paid as you want. What I mean is that there is probably someone in your IT

department who would love to make a name for themselves in the organization, and they

may come up with INTERNET INVOICING as their ticket.

They will make sure that the application that they recommend will suit their needs, and not

necessarily yours. They will typically look at something that will be highly controlled by IT

and will reside in their fiefdom. Purchasing holds the same opportunity to have someone

sabotage your department’s goals. They will typically look into an application that is focused

on PROCUREMENT, with a slight regard to ELECTRONIC INVOICING. Both of these scenarios are bad

because the control is taken away from the group that needs it. A good INTERNET

INVOICING solution will allow administrators in the ACCOUNTS PAYABLE DEPARTMENT, to run

reports, make queries, check on statuses, etc. AP will not need IT’s involvement to run

reports to see how much was spent on de-icing last November in Maine, the AP folks will be

able to do that.

This is typically a good thing from an IT perspective, since they are usually overworked

and under-appreciated and are glad to have menial tasks like that off of their plate. In

reality, purchasing is probably the bigger threat to a successful ELECTRONIC INVOICE

INITIATIVE. Their goals are centered on things that they already know, and do not want to

enlist the help of other departments. All in all, it is in your best interest to get the ball

rolling with ELECTRONIC INVOICING as soon as possible, if you don’t, someone else will!

EIPP AND AP MANAGER QUALITY OF LIFE

When we discuss the benefits of ELECTRONIC INVOICE PRESENTMENT AND PAYMENT (EIPP), it is

usually around efficiency gains, reduced error rates and additional tangible benefits

like DYNAMIC DISCOUNTING. But one of the greatest benefits is the improved “quality of life” for

the AP MANAGER.

Traditionally, the PAYABLES DEPARTMENT deals with a lot of fires that normally stem from a

supplier that needs to get paid, or someone that got paid when they shouldn’t have. There

are other issues like an invoice being improperly coding, or audit questions around if all the

correct signatures were all collected, but more often the panic raising issues deal with some

supplier who hasn’t been paid and no one knows why, or a SUPPLIER who was paid when

they shouldn’t have been. The crisis usually starts with a conversation between some

employee and a SUPPLIER where the employee is saying something like, “that should have

been paid already, let me see what’s going on”, followed by some disparaging remark

towards the PAYABLES DEPARTMENT and emails cc’ing everyone’s boss.

Enter EIPP. Organizations are amazed with how smoothly PAYABLES runs when invoices are

visible from day one. When a SUPPLIER submits an invoice through a web portal, or uploads

a file, the invoice is immediately visible to everyone in both organizations (at least with a

high quality EIPP solution). Anyone, including the SUPPLIER can see where the invoice is, and

if it has been approved or matched or paid. All of the mystery and distrust melt

away. There’s no finger pointing of who was responsible for losing the invoice. Did

the SUPPLIER really send it? Did the manager really approve it and forward it on? Did a

PAYABLES clerk accidentally file it in the wrong pile? All of those issues disappear

with ELECTRONIC INVOICE PRESENTMENT AND PAYMENT.

The result of EIPP is a more visible and uniform process, which in turn, means less

firefighting. As one manager after implementing ELECTRONIC INVOICE PRESENTMENT AND

PAYMENT put it, “we became seen in the best light ever”. And that’s what EIPP should do. It

should lower your per invoice cost and it should make your PAYABLES DEPARTMENT look

good. And if your PAYABLES DEPARTMENT looks good, the blood pressure of your AP

MANAGER should drop a few points back down towards normal.

BUILDING A BULLETPROOF BUSINESS CASE: WEBINAR WITH

IPAYABLES & PAYSTREAM FEB. 23RD 11AM PST

Building a solid business case is often one of the most over-looked, but important steps in

launching an AP AUTOMATION INITIATIVE. Project launch success is realized or lost based on the

initial strategy and roadmap you develop, so don’t miss this critical webinar where we’ll be

discussing key elements to consider while building your case. PayStream has been

developing AUTOMATION roadmaps for over 10 years and have the tricks of the trade to share

with you in this complimentary 50-minute webinar with head AUTOMATION architect, HENRY

IJAMS and PAUL KERINS from IPAYABLES. Listen in as they discuss:

Make your case and win upper management approval the first time.

Ways to get IT, PROCUREMENT and other departments on the same plan.

Navigate the AP AUTOMATION technology jungle like a pro.

AP DEPARTMENT metrics | what’s your paper quotient?

Review the elements of a winning AUTOMATION roadmap.

PROMINENT E-INVOICING SPEAKERS FOR WEBINAR ON

FEBRUARY 23RD

In a few weeks we are in for a real treat. Two of the top moderators and speakers in

the ELECTRONIC INVOICING INDUSTRY will be joining together for a webinar on “BUILDING A

BULLETPROOF BUSINESS CASE”.THOSE TWO SPEAKERS WILL BE HENRY IJAMS FROM PAYSTREAM ADVISORS AND

PAUL KERINS FROM IPAYABLES.

HENRY IJAMs (pronounced Iams) is the Managing Director and Founder of PAYSTREAM ADVISORS.

As a former banker and PAYMENTS TECHNOLOGY entrepreneur, he is well-known in the FINANCIAL

AUTOMATION and PAYMENTS INDUSTRY and speaks frequently at conferences. Mr. Ijams’ 20 years

of experience includes key positions with Citibank and Manufacturers Hanover Trust as well

as a manager of Ernst & Young’s Financial Services Consulting practice.

Mr. Ijams has developed a leadership position in the financial industry through his research

publications and articles on trends and strategies on the automation of back-office financial

operations such as ACCOUNTS RECEIVABLE and PAYABLES, and treasury. PAUL KERINS VP of Sales

with IPAYABLES is also well-known for his expertise and speaking abilities in the

E-INVOICING INDUSTRY. He has over 20 years’ experience in the B2B market place and has

spoken at the IAPP Conference for the past 4 years. Next week he will be speaking at the

Kentuckian IAPP/IARP chapter meeting on February 9th at the Papa John’s corporate offices

in Kentucky.

Join Henry and Paul, for a lively discussion about “BUILDING A BULLETPROOF BUSINESS CASE”.

Utilized and used by more than 100,000 companies in over 150 countries, including over

half of the Fortune 100, IPAYABLES is the leading provider of advanced ELECTRONIC INVOICE,

APPROVAL WORKFLOW, AND PAYMENT SOLUTIONS.

AVOID SUPPLIER FEES AND GUARANTEE SUCCESS

If you’re evaluating a few different PAYABLES AUTOMATION SOLUTIONS and the topic of SUPPLIER

FEES hasn’t come up yet, then chances are the AP AUTOMATION PROVIDERS don’t want to talk

about it. There are two different models of ACCOUNTS PAYABLE AUTOMATION that have

developed.

The first was focused on making ACCOUNTS PAYABLE as efficient as possible that is, getting as

many suppliers as possible to send electronic invoices. This means no supplier

fees. Making your PAYABLES AUTOMATION solution free for suppliers makes SUPPLIER

ADOPTION fairly straightforward. This is a great model, but because all the costs are borne

by the ACCOUNTS PAYABLE DEPARTMENT, the AP AUTOMATION SOLUTION PROVIDER has to be very

efficient to keep that cost low. After all, if the ELECTRONIC INVOICE costs more than what

the ACCOUNTS PAYABLE DEPARTMENT is saving, why bother? The second model was developed

by companies that couldn’t make the first model work. A pretty harsh statement, but in my

opinion some of the AP AUTOMATION SOLUTION PROVIDERS just weren’t that efficient. They were

forced to charge way too much for their ACCOUNTS PAYABLE AUTOMATION SOLUTION and they

weren’t making sales. They decided that they could charge the supplier for the bulk of the

price and still make a business case to the PAYABLES DEPARTMENT. Not a bad idea if your

suppliers have so much extra money that they don’t mind paying a few bucks to deliver an

invoice.

However, most of the suppliers I know are pretty good at somehow moving any new costs

back into the price we pay (if they’re not good at it, they go out of business, right?). One of

our clients estimated their average invoice cost the supplier would pay for this type of

model was $15 per invoice (the AP automation provider they were looking at charged the

supplier a percentage of each invoice).

At the end of the day, we’re talking about ACCOUNTS PAYABLE here. AP is not a department

where we ignore costs because we want to buy the impressive name. A $15 fee per invoice

is ridiculous. Depending on your volumes, you should be able to find a high quality solution

with high service levels for about $1 per invoice. That should include services like free

support and FREE SUPPLIER ADOPTION. Look for high guaranteed uptime.

If you’re feeling adventuresome, ask them to guarantee the results in the contract. How

many invoices or suppliers do you need to feel your initiative was a success? Just make

them guarantee that number. If they can’t guarantee success, why go with them? And

lastly, make sure they guarantee that there are NO SUPPLIER FEES.

IMAGING IS NOT ELECTRONIC INVOICING

There seems to be some confusion in the marketplace as to what is an ELECTRONIC

INVOICE. When we speak about ELECTRONIC INVOICE PRESENTMENT AND PAYMENT (OR EIPP), we are

speaking about ELECTRONIC INVOICING, not having your supplier print out an invoice, mail it to

you, you scan it, and then you email the invoice to your boss for approval. Once approved,

you get to key it into your ERP.

Many companies that rely solely on imaging as a way to “ELECTRONIFY” the invoice, are the

ones who are perpetrating this confusion. Their concept of taking a piece of paper and

scanning it, makes it an ELECTRONIC INVOICE. This is technically correct, but they are missing

the real point of EIPP, getting rid of the paper and speeding up the process. When a vendor

emails a pdf, and then you get it and print it out, some would argue that since it was

emailed, and went over the internet, that it was an internet invoice.

I completely disagree. There are so many benefits to having a great ELECTRONIC INVOICING

SOLUTION, such as not having to key in your invoices that are just not feasible with a classic

scanning solution. When we use the term “WEB INVOICING” it should mean so much more

than that the delivery method was over the internet. A true ELECTRONIC INVOICE is not only

created ELECTRONICALLY, like most invoices actually are, but remains in an electronic state,

and DOES NOT NEED TO BE PRINTED. If you are truly receiving ELECTRONIC INVOICES, you should

not have to key in the invoice, just provide the approval and any relevant coding.

The beauty of ELECTRONIC INVOICES is that all of the work done by the supplier to get the

information onto that invoice, was not wasted effort. Over 90% of all invoices could be

described as “ELECTRONIC” if we just look at the fact that they are typically spit out of a

computer in an electronic format, and sent to a printer, that takes the electronic data and

prints it into something we all recognize as an invoice. I am willing to bet there are very few

people that would argue that this is ELECTRONIC INVOICING. And if anyone would like to argue

it, I will be at IOFM in New York in March.

INTERNET INVOICING is a great way to get invoices approved quicker, so suppliers can get their

money quicker. All of this, and an ELECTRONIC INVOICE costs about a third to process as a

paper invoice. E-INVOICING is here to stay, and I think that is what is making the imaging

houses nervous. They know that their solution posed as an “E-INVOICE” is old technology that

had a useful place in the market, but better solutions have arrived. That is why I am trying

to get the world to think of ELECTRONIC INVOICES as an INTERNET INVOICE. This may help move us

along and get rid of the posers.

ELECTRONIC INVOICING MORE THAN JUST IMAGING

Some people would say that I am confusing matters by speaking of INTERNET

INVOICING and ELECTRONIC INVOICING in the same blog. To me they are the same, but you will

find far fewer companies in the INTERNET INVOICING space compared to the ELECTRONIC

INVOICING or even AP AUTOMATION space. I think that this is due to the imaging provider’s effort

to disguise what they are doing, and trying to compete with companies like IPAYABLES that

are truly offering PAPERLESS INVOICING or INTERNET INVOICING.

Companies like ARIBA, the company formerly known as XIGN, and of course IPAYABLES, are a

few of the true INTERNET INVOICING organizations, and should not be lumped into a category

that also includes companies that offer far fewer services, such as the companies that only

take a piece of paper, and scan it into a data base. Come see us at IOFM in March in the Big

Apple!

AP AUTOMATION DONE RIGHT

Every innovation takes time to mature, to reach that point when everyone looks at the end

result and says “That’s it”. From that point the innovation often continues but it’s those

salient mile markers that all agree mark the arrival of a product category, industry or

process. This has been seen over and over again in the personal computing world, first with

desktops, then notebook computers, and now with the iPad and iPad 2 marking the arrival

of the tablets.

ACCOUNT PAYABLE AUTOMATION has been searching a long time for the ‘right’ solution to the

varied and numerous problems that face AP DEPARTMENTS. ERP vendors

like ORACLE, SAP and PEOPLESOFT with their E-INVOICE products and initiatives each tried to

streamline the PAYABLES process. EDI SERVICES with their focus on the supplier’s and

VAN networks brought a different dimension to the solution canvas and removed some of the

friction but fell short. IMAGING with its high tech hardware and fancy OCR templates promises

to ‘AUTOMATE’ the paper, but as my friend Paul wrote last week, “IMAGING IS NOT ELECTRONIC

INVOICING“. So what is the “right” solution?

Has ACCOUNTS PAYABLE AUTOMATION really arrived? The Holy Grail of AUTOMATION is not just the

handling of paper but the removal of it. This has been the short coming

of IMAGING, ORACLE INVOICE, SAP INVOICE and PEOPLESOFT INVOICE and many other schemes

hoping to solve the AP riddle. The ‘right’ solution includes the best aspect of it’s

predecessors and marries that with original thinking and approaches. The WORKFLOW of SAP

INVOICE, the connectivity of EDI services, the paper handling of IMAGING all fail individually but

when merged with fanatical SUPPLIER ADOPTION, a deep understanding of the ACCOUNTS

PAYABLE process and the reach of the internet magic happens. A web driven, supplier

enabled, WORKFLOW AUTOMATED, highly visible and completely controlled AP PROCESS is the

result. Don’t settle for good enough. AP AUTOMATION can be done right. And it can be done

right now.

THE TRUTH ABOUT AP OUTSOURCING?

In regards to processing of ACCOUNTS PAYABLE, OUTSOURCING is generally not high on their lists

of things to do this year. I would agree. I’m not one to take a whole department and

outsource it to another company. The term OUTSOURCING generally has a ‘not-so-positive’

connotation associated with it and I would say that it also applies to ACCOUNTS PAYABLE

OUTSOURCING. The ACCOUNTS PAYABLE DEPARTMENT serves a critical function in large

organizations and OUTSOURCING the whole account payable group can put those companies at

a disadvantage.

I believe that ACCOUNTS PAYABLE DEPARTMENTS can achieve the same cost saving but with

greater benefits by taking advantage of the many tools and services that are available

today. Just like the days of paper ledgers are essentially dead, the days of paper invoice,

paper checks, and paper purchase orders nearing the end. These tools and services can

help you achieve your goals without having to do AP OUTSOURCING. Numerous services which

are currently available which allow ACCOUNTS PAYABLE DEPARTMENTS to maintain all of the

control, visibility, accuracy, speed and compliance they require while at the same time

providing the additional advantages of cost savings, maintainability, flexibility and greater

compliance with no capital costs.

These tools s can provide you features such as PURCHASE ORDER PRESENTMENT, ELECTRONIC

INVOICE submission via a multitude of methods, PURCHASE ORDER MATCHING, INVOICE

VALIDATIONS, WORKFLOW options to handle all of your exceptions, track able disputing, invoice

approvals based on your companies specific needs and rules, DYNAMIC DISCOUNTING, INVOICE

STATUS, INVOICE PAYMENTS via ACH or Corporate Card, etc. The economies of scale are such

that you can get all the features of a Mercedes at the price of a Focus.

Most importantly with these services is that they will work with you as a partner and in

addition to the features list, they provide the CONSULTING, VENDOR ADOPTION and SUPPORT

SERVICES that really make the difference. So say no to ACCOUNTS PAYABLE OUTSOURCING and

take a look a the tools and services available, by companies like IPAYABLES, which keeps

ACCOUNTS PAYABLE in control and expands the value that your department provides.

ELECTRONIC INVOICING IN THE “CLOUDS”

A friend and I were discussing IPAYABLES and our ELECTRONIC INVOICING

application, INVOICEWORKS, and he was asking if it was in the “CLOUD.” I feel that the

term CLOUD INVOICING refers to any ELECTRONIC INVOICING application that is a hosted solution

and is accessed from the internet. This is not necessarily the true technical definition of the

CLOUD, but it is what most non IT folks think.

So my colleague asked “Where is the CLOUD?” Now this is a little trickier. If your IT

department is not hosting your specific data, it is in the CLOUD. It is being hosted by

another company and you are retrieving it via the internet. It is a nebulous concept without

a specific location, hence the term cloud. There is not a single CLOUD for CLOUD INVOICING, just

like there is not a single CLOUD in the sky. And more importantly, not all CLOUD INVOICING is

the same. They are all different to one degree or another. Of course this elicited the

following, “Well then how is INVOICEWORKS CLOUD INVOICING different?” To this I answered the

usual string of benefits such as common functionality like PO FLIP, NOTIFICATION ESCALATION, AD

HOC REPORTING capabilities, ADVANCED DUPLICATE DETECTION, etc.

Then I decided to take it a step further. I decided to speak to the fact that our application

is covered under US Patent #6,826,542. This is a patent that allows for the customization

of an INTERNET INVOICE. In general terms, it is the patent that allows one client to present

their standard CLOUD INVOICE to their suppliers with their specific and customized fields and

layout. Another client will present their CLOUD INVOICE, through the

same INVOICEWORKS application, with differing fields and layouts.

This may seem like a simple thing, but we hold the patent, and have for a long time. We

are not new to the CLOUD INVOICING game; in fact, we were in the game before anyone was

referring to it as CLOUD INVOICING. With all of that said, we chatted about security of data,

how maintenance is handled and a few other tid bits of information. When I felt that he had

heard all that he could handle, I finally told him to get his head out of the CLOUDS, and get

his ELECTRONIC INVOICING into the CLOUD with INVOICEWORKS BY IPAYABLES.

DISCOVERING AP WORFLOW

We are back now to the wonderful world of INVOICE MANAGEMENT and WORKFLOW.

Just a quick recap on the why we do it:

ENFORCE BEST PRACTICES AND PROCEDURES

ACCELERATE PROCESS CYCLE TIMES BY AUTOMATING REPETITIVE TASKS

CHANGE BUSINESS RULES AND LOGIC WITHOUT REQUIRING IT RESOURCES

ENSURE ACCURATE DATA ENTRY OR DOCUMENT CREATION

MANAGE AND MONITOR PERSONNEL AND OPERATIONS PERFORMANCE

I like to think of INVOICE MANAGEMENT and WORKFLOW a bit like driving. The rules of the road

are well defined and everyone operates, the WORKFLOW that is, operates according to these

rules. Do you recall what it was like driving when the power goes off? The street lights are

out so, in general, it is much darker than normal. The stop lights are also out, hopefully

blinking red but not working as normal. You get to a big intersection with multiple turning

lanes and it is just a bit confusing on whose turn it is. Take this a bit further for those of

you who have driven in a third world country and the confusion can go up ten-fold. (Horns

essentially replace brakes. The biggest vehicle has the right of way.) Without this

established WORKFLOW, things don’t move as smoothly or as quickly. Ok, but will just

any WORKFLOW do? I say the answer is no.

We have all seen or been conscripted to participate in those processes in INVOICE DOCUMENT

MANAGEMENT which just don’t make any sense. They seem to take way too long, involve a

plethora of paperwork and bureaucracy and at the end of the day may or may not even

accomplish what it was that we needed done. We walk away from our current INVOICE

MANAGEMENT activities thinking that there just has to be a better way. (Remember the

process and the paperwork associated with your mortgage?).

Now would it make sense to AUTOMATE a poor process into your new workflow? Obviously

not but all too often this is what occurs. Taking a sub-par or bad process and implementing

an AUTOMATED WORKFLOW based on it will essentially just produce the same bad results and

more of them. You may ask why more bad results? The reason is that by now enforcing

the sub-par or bad process, the alternate paths that people had been using to actually get

things done could now be closed forcing them back into the process they had been working

around, resulting in more issues.

The point is to review any process that you are going to implement into

your IMAGING and INVOICE WORKFLOW. Eliminate the steps that were put in 10 years ago that

make no sense today. Review ACCOUNTS PAYABLE WORKFLOW best practices to improve upon

what you are currently doing. Reject the idea “We’ve always done it that way” and embrace

“If it isn’t broke, improve it.” Make it ‘Better, Faster, Smarter’. Something great happened

a few months ago. My garage flooded. You may think I sound a bit crazy but it provided

me the needed impetus to revisit my garage organization paradigm. I took the opportunity

to completely redo how everything was organized and I can honestly say I am much happier

as a result.

At the end of the day, we all have areas, such as INVOICE APPROVAL WORKFLOW, which need

some process redesign and are currently causing us pain (i.e. my garage) and we know the

benefits but we put it off. Take the opportunity of setting up WORKFLOW to review and

change things for the better. At the end of the day we all want a solution which puts us

more in control of our jobs, makes our lives easier and helps make our organization, our

bosses and ourselves look good.

E-INVOICING IMPROVES THE ENVIRONMENT AND YOUR EQUITY

As corporations struggle to improve

their financials and increase their ROI’S it

would benefit them to take a hard look at

what a company can do to improve the

environment. Take these facts for

example, based on each INVOICE it takes

one average tree to produce 2778

invoices. With this information it is easily

discernible that over a million trees could

be saved if most of these INVOICES were

transmitted ELECTRONICALLY.

With these savings over 83,000 barrels of

oil and over 171 million kilowatts of

electricity needed to produce the

paper, would avoid 2.5 pounds of air pollutants and keep 138,000 yards of paper from

eventually landing in the landfills. A few months ago Earth Day came and left us with

several promises being made by corporations to help improve the environment. Recently I

researched some of these promises and found out the following information. Walmart has

signed a 500 million dollar agreement that would “reduce greenhouse gas emissions, build

more energy efficient stores and reduce packaging waste.”

Microsoft has also has become more environmentally efficient. They are installing solar

power energy cells that would produce enough power for 500 homes. Several companies

have not only seen the value of becoming environmentally efficient but also the value of E-

INVOICING and how it can improve their financials. Many of the corporations that do

ELECTRONIC INVOICING have commented on how easily the change can take place. A lot of

them have said that the WORKFLOW has gone from sometimes waiting days to retrieve

records that were archived off site, to accessing the same files in two or three seconds —

saving time, creating efficiency and improving customer service. An initial outlay of several

thousands of dollars is well worth it. For every dollar that they spend, they save a dollar

plus another 85 cents.

In a recent interview with one of those companies a CEO, talking about reducing paper in

their office said, “I wouldn’t call it the paperless office — that’s not going to happen for a

while, but the less-paper office IS here to stay.”

Stay tuned to future posts and updates concerning the less-paper office and the

environment.

AP AUTOMATION IN 2012

So the New Year is upon us and we have a couple of weeks already checked off on the

calendar. ACCOUNTS PAYABLE DEPARTMENTS all over are wrapping up 1099s and closing out the

year if their fiscal calendars align. In the back of your mind are the goals for the next year.

You’ve survived one more year with the mountains of paper. You’ve held together with

paper clips and chewing gum a department stretched to its limit. This year really should be

different. But how. The options can seem vast and wide and deep. Should you

implement WORKFLOW in SAP INVOICE or ORACLE? Should you build a vendor portal? Should you

push for EDI from every supplier? Should you partner with an INVOICE AUTOMATION PROVIDER?

The answers are “maybe”, “no”, “probably not” and “absolutely.”

There are plenty of environments where SAP, PEOPLESOFT, or ORACLE WORKFLOW are the

perfect solution. Integrated in to SAP INVOICING, PEOPLESOFT INVOICING or ORACLE

INVOICING these WORKFLOWS can reduce approval time, ease tracking and provide

visibility. You still have to figure out how to get paper into these WORKFLOWS, but it’s at

least half the problem. You should definitely not build a vendor portal. There is enormous

value is providing your suppliers visibility and access online. But unless you are willing to

front end your AP process online and allow suppliers to submit invoices you’re not going to

get a very rapid return on investment, if at all. EDI from everyone? Really not 2012 kind of

thinking. EDI is great in a select number of situations. That’s it. If you’re Walmart or The

Home Depot maybe you can push the EDI envelope, otherwise, forget about it.

Partnering with the right INVOICE AUTOMATION PROVIDER is the smart choice in 2012. With the

best providers including WORKFLOW, EDI SERVICES with connections to EDI VANS and online

access for your suppliers, the right provider can bring the perfect blend of technology and

services to the table. Matched to your existing ACCOUNTS PAYABLE PROCESSES and up in

running in a matter of weeks, the right partner can help you make the most out of 2012.

Of course IPAYABLES is just such a partner. I know of a company that receives

99% ELECTRONIC INVOICES. They are so large that they still are processing over 400,000

paper invoices a year. With that volume, they are a perfect candidate for our ACCOUNTS

PAYABLE AUTOMATION application!

2011 – AN ELECTRONIC INVOICE REVIEW

2011 is now in the rear-view mirror and 2012 looms large before us. Many companies

embraced ELECTRONIC INVOICING in 2011, especially those looking to leverage the internet and

more advanced AUTOMATION options. EDI SERVICES continued their traditional role in the

manufacturing and retail worlds, delivering a decent number of EDI INVOICES but only to a

limited number of suppliers and partners. The big ERP software providers pretty much sat

out 2011 with ORACLE INVOICE and SAP INVOICE offering no new ideas or capabilities. Some

innovative partners have tried to move these services to the cloud, but adoption and pricing

is murky. PEOPLESOFT INVOICE didn’t move much as ORACLE focuses on its core productions

and tries to secure its position in a changing software environment. There was some

interesting acquisitions as Ariba purchased European E-INVOICE provider B-Process, but

nothing like the EIPP buying frenzy of 2007.

So what did the most forward looking companies do in 2011? They selected established,

capable partners to drive efficiency and control in ACCOUNTS PAYABLE. As a result

many ACCOUNTS PAYABLE DEPARTMENTS increased in visibility and stature. Many AP

MANAGERS rose through the ranks and enjoyed the spotlight for bringing AP in to the 21st

century. These companies did their homework and selected an ELECTRONIC INVOICING partner

that had a track record of delivering the needed tools and services needed to ensure

success. In many cases the partner selected was IPAYABLES.

So here is to 2012. Live a little. Push the boundary a bit. Move outside of the comfort

zone just a smidge. Dive on in. The water is just fine. Join with us on an ELECTRONIC

INVOICE adventure. You’ll be glad you did.

ELECTRONIC INVOICING IN 2013

Now that we are in the midst of 2013, I wanted to share what is happening in

the ELECTRONIC INVOICING market space. I see that there will be great advances in the

amount of reporting from invoices that were submitted electronically. Think about it, when

a vendor submits an ELECTRONIC INVOICE, there is a wealth of data on that E-INVOICE that you

should be able to analyze. One of our customers (One of the World’s Largest Restaurant

Chain) is using our AD HOC REPORTING to see how often certain ovens are repaired versus

replaced. This gives them the ability to make decisions on whether they should purchase or

replace that oven.

They are also using it to analyze localities and repair rates. All of this information is

available due to ELECTRONIC INVOICE submission, and advanced querying capabilities in our

application. Many ELECTRONIC INVOICING applications have reporting, but the ability to actually

search the data on the invoices and make business decisions, has not been universal in its

implementation in the industry. Another activity in the New Year will be a renewed sense

of VENDOR ADOPTION in the ELECTRONIC INVOICING arena. Many companies have gone with the

dump and run approach in selling E-INVOICING. They get you up and running (hopefully in

less than 4 months) and then they are off to the next account, leaving AP individuals to try

to become VENDOR ADOPTION experts or have the project fail. I think there will be a shift to a

more hands on approach like IPAYABLES has.

With the industry seeing that we are averaging 70% vendor submission of ELECTRONIC

INVOICES within the first year, they really have no choice but to come around and become

advocates of VENDOR ADOPTION, and stop charging their customers for activities that are so

vital to the success of an ELECTRONIC INVOICING initiative! The final thing I think we will see is

more payment options around ELECTRONIC INVOICING. It only seems natural that people will

want to submit an ELECTRONIC INVOICE, and then have the customer able to pay

that ELECTRONIC INVOICE, electronically. I wish you all a Happy and Prosperous New Year!

THE GROWTH OF PAYABLES AUTOMATION SYSTEMS

I recently read an article discussing the GROWTH OF PAYABLES AUTOMATION SYSTEMS. The article

suggested the use of PAYABLES AUTOMATION SYSTEMS would grow 32% by 2016. Research firms

have been predicting rapid growth of PAYABLES AUTOMATION for quite some time now, but the

scale of the growth now seems to be hitting the mainstream ACCOUNTS PAYABLE

DEPARTMENT. That’s good news for PAYABLES DEPARTMENTS that are usually a bit more

conservative than other groups. Although it’s still looked at as new technology,

IPAYABLES has been offering PAYABLES AUTOMATION SOLUTIONS since 1999 with large customers

like AMERICAN AIRLINES using the technology for more than a decade now. So the PAYABLES

DEPARTMENT that is considering AP AUTOMATION can feel a bit more comfortable that many of

these solutions have been around for a long time now and have a good track record with

reference-able clients.

PAYABLES AUTOMATION SUPPLIERS are becoming more popular and more competitive. Providers

who once offered only a small portion of functionality have a more complete offering than

before. The pioneers of PAYABLES AUTOMATION are creating functionality that goes beyond the

basics and have some really fun aspects of their solutions. All in all, it’s an exciting time to

be implementing PAYABLES AUTOMATION. If you’re ready to start researching an AP

AUTOMATION project, I would suggest a few guiding principles:

TALK TO A FEW PROVIDERS (INCLUDE IPAYABLES, OF COURSE) TO UNDERSTAND THEIR PAYABLES

AUTOMATION SOLUTION BEFORE YOU START LISTING WHAT YOU’RE LOOKING FOR. WE HAVE MANY PEOPLE

WHO WILL BUILD A PROJECT AROUND A COUPLE OF REQUIREMENTS, FORM A PROJECT, AND THEN DISCOVER

THAT THERE IS A LOT MORE TO PAYABLES AUTOMATIONTHAN THEY ANTICIPATED. IT IS VERY COMMON TO

HAVE A PAYABLES AUTOMATION PROJECT THAT IS LOOKING FOR ONLY SCANNING ANDWORKFLOW. WHEN

THEY DISCOVER THE ELECTRONIC INVOICING, MATCHING, DYNAMIC DISCOUNTING AND COMPREHENSIVE

NATURE OF A TRUE PAYABLES AUTOMATION SOLUTION, THEY SOMETIMES FEEL LIKE THEY NEED TO START

THE PROJECT FROM SCRATCH.

LOOK FOR AN ENTERPRISE-WIDE SOLUTION (AND PREPARE OTHERS FOR IT). YOU MIGHT BE TEMPTED TO GO

WITH A SOLUTION THAT DOESN’T IMPACT THE ORGANIZATION, SOMETHING YOU CAN QUIETLY IMPLEMENT

WITHOUT DISTURBING ANYONE. HOWEVER, PAYABLES AUTOMATION DOES CHANGE HOW THE ENTIRE

BUSINESS DOES PAYABLES. YOU CAN’T TRULY CHANGE HOW THE ENTIRE BUSINESS DOES PAYABLES

WITHOUT IMPACTING THE ENTIRE ORGANIZATION. YES, YOU WILL HAVE PEOPLE WHO LIKE SIGNING THEIR

NAME TO APPROVE AN INVOICE AND THEY MIGHT COMPLAIN ABOUT CHANGE, BUT AUTOMATION IS

CHANGE. CHANGE IS THE GOAL.

BE PREPARED TO CHECK REFERENCES. SOME SOLUTIONS ARE A BETTER FIT FOR YOUR ORGANIZATION

THAN OTHERS. TALK TO A COUPLE OF THEIR CLIENTS TO SEE HOW THEY USE THE PAYABLES

AUTOMATION SOLUTION. ASK WHAT THE PAYABLES CLERKS THEY HAD BEFORE THEY IMPLEMENTED ARE

DOING NOW. (IF THEY STILL HAVE THE SAME CLERKS DOING SIMILAR WORK, THEN THEY REALLY DIDN’T

AUTOMATE ANYTHING). TALKING TO A SOLUTION PROVIDER’S CLIENTS MIGHT BE DIFFICULT, BUT IT IS

REALLY IMPORTANT. DON’T SKIP THIS STEP!

There are other items to consider, but the above bullet points are things that I’ve frequently

seen missed. If you have PAYABLES AUTOMATION on your list of New Year’s resolutions, then

be excited about it. It’s a great time to automate your PAYABLES DEPARTMENT!

AP WORKFLOW – A LITTLE GOES A LONG WAY

Like many best practices, moderation is the best implementation practice. Instead

practitioners take the “if a little is good, a lot must be great” approach and end up drowning

in the thing that was supposed to make life easier. This is often the case with ACCOUNTS

PAYABLE WORKFLOW. The promise of being able to route invoices electronically paints a

sparkling picture of documents zipping around the organization at light speed, all under the

watchful eye of ACCOUNTS PAYABLE. This is exactly how WORKFLOW is supposed to work but

often, given the ease of manipulating the WORKFLOW routes become too complex

or AP becomes a bottleneck in the flow.

The first problem of complexity usually comes about because insufficient attention is given

to exceptions. Instead of addressing an underlying business process problem related to

exception handling the “just add another rule” mentality leads to a maze of conflicting and

often compounding WORKFLOW rules. The awesome ability to direct the flow invoices on the

fly is now the source of many problems. ACCOUNTS PAYABLE sometimes take the somewhat

opposite approach. “The field is too busy/stupid/lazy to properly handle these invoices.

We’ll take care of it.” Routing every INVOICE to AP in organizations of any significant size is

the death nail of workflow. Out the window go 90% of the benefits and efficiency that might

have been gained. Of course there are plenty of reasons INVOICEs get routed to AP. Yes new

rules are needed to handle those special cases. The road to logjam is paved with good

reasons. Follow these simple rules to make sure your ELECTRONIC WORKFLOW delivers:

1. Follow the 80/20 rule. Maybe even 95/5. The vast majority of invoices should enter

the organization using a simple key. Either Requestor, Buyer, Location or some other

value that the supplier may know. Relate this key to the starting point in the

organization. Don’t start INVOICES in AP and send them out from there.

2. Utilize some kind of hierarchy to advance INVOICES along the route as needed for

additional approvals. This may be reporting structure based or business

based. Again, 80% of invoices should follow this structure without fail.

3. Utilize a matrix of approval limits to determine when an INVOICE is finally approved for

payment.

4. Limit AP review of INVOICES to actual trouble suppliers, business units or spend.

Of course, AP WORKFLOW included in IPAYABLES INVOICEWORKS helps enforce all of these best

practices and includes all the bells and whistles (Vacation Reroute anyone?).

TAKE CHARGE OF YOUR FUTURE, OR LOSE IT AP AUTOMATION

VS PROCURE TO PAY

Every customer using IPAYABLES INVOICEWORKS has one thing in common; they are in control

of the function they provide to their organization. Not only do they understand well the

benefits they provide (as I believe most payables managers do), but they have the clout

and respect needed to control the future of that function on behalf of their company.

A PAYABLES DEPARTMENT that has implemented AP AUTOMATION (aka ELECTRONIC

INVOICING, INTERNET INVOICING, EIPP, or pick your favorite buzzword for automating the paper

invoice process) have their house in order. The per-invoice processing cost is low, visibility

and control is high, and generally they are viewed in a very positive light by the

organization. They are in control of their function.

A PAYABLES DEPARTMENT that still receives a lot of paper invoices is still dealing with paper

related problems and the associated high costs. In that case, a procurement department

may look at a PROCURE TO PAY solution (PURCHASE TO PAY, PROCUREMENT TO PAY, ETC.) and feel that

they might be able to do a better job at payables than the PAYABLES DEPARTMENT. In some

aspects, they are probably right. A PROCURE TO PAY solution will automate that process for

those invoices coming from procurement and will eliminate paper related problems.

The problem (at least for the payables manager’s career) at that point is

PROCUREMENT becomes the owner of an AUTOMATED PAYABLES process and payables becomes a

subset of PROCUREMENT. This works for some companies (perhaps those where 90% of

invoices come from purchase orders), but for most companies, payables is a separate group

for a good reason.

The wiser move is for the PAYABLES MANAGER to AUTOMATE the payables processes today

(preferably with IPAYABLES INVOICEWORKS). With the paper related problems gone, there is

very little reason for PROCUREMENT to want to take over payables processes. Payables is

efficient and can provide much better payables expertise than PROCUREMENT in managing

suppliers, payments, and all the associated processes and regulations. Don’t get me wrong,

I like PROCUREMENT and the function they provide. However, I know the value that payables

groups bring to organizations and I hate the thought of PROCUREMENT taking over that area

only because a payables group didn’t get around fast enough to selecting a payables

oriented automation solution. My advice to the PAYABLES DEPARTMENT: take charge of your

future or lose it.

E-INVOICING IS LIKE FINDING MONEY IN THE CUSHIONS

Have you ever been moving around furniture or trying to find the remote between the

cushions and found other, unexpected things? Sometimes it is a pleasant surprise like a cell

phone vibrating where no one could hear it, a missing wallet or enough change to buy a

sundae. Other times the surprise is less inviting like an empty Doritos bag of your son’s, a

school of fish (the crackers) or sandwich from the playground. Whether pleasant or not, I

would say it is a good thing. You’ve ‘cleaned house’ and things are better.

ELECTRONIC INVOICING has some of the same ‘cleaning house’ benefits which are good to help

your department and company. I have had the benefit of being in the front row and

participating with some of these benefits as customers have both prepared and gone live

with their ELECTRONIC INVOICING initiatives. To highlight just a couple areas:

‘Actual’ WORKFLOW processing:

COMPANIES DISCOVER HOW INVOICES ARE ‘REALLY’ PROCESSED AND APPROVED IN THEIR COMPANIES.

WORKFLOWS THAT STILL SHOW USERS APPROVING INVOICES THAT NO LONGER WORK AT THE COMPANY

OR HAVE CHANGED POSITIONS, OR PAPER-BASED FLOWS THAT DON’T PROPERLY REFLECT COMPANY’S

ACTUAL CONTROLS.

VENDOR and/or PURCHASE ORDER information not as clean as you expected:

14 ACME VENDORS WITH ALL THE SAME INFORMATION WITH INVOICES APPLIED TO MULTIPLE ACCOUNTS

VENDORS WHO HAVE NOT SUBMITTED INVOICES SINCE CLINTON WAS PRESIDENT

PURCHASE ORDERS CREATED AFTER INVOICES ARE RECEIVED

PURCHASE ORDERS MISSING DESCRIPTIONS OR ASSIGNED TO OLD OR INCORRECT VENDORS

ELECTRONIC INVOICING helps companies identify areas that may be holding them back, causing

delays, frustration or productivity issues, and provides tools to either eliminate, resolve or

minimize these surprise discoveries. Companies can now have better controls and

simplification of what otherwise could be out of control or overly complex processes. Better,

cleaner data means fewer calls from vendors regarding purchase order discrepancies or

duplicate payments to the same vendor with multiple vendor numbers. One of the things I

enjoy most about working with various companies is helping them solve problems and

discover better ways of doing things. You too can find those hidden items in your cushions

and with E-INVOICING realize the extra benefits of a ‘cleaner’ and better running house.

E-INVOICING – NO SUPPLIER FEES

There are many aspects that should to be considered when running a successful ELECTRONIC

INVOICING initiative. Including a SUPPLIER ADOPTION PLAN that will help keep adoption rates at a

maximum level is paramount. This can be done with an effective policy concerning

suppliers. With a dedicated SUPPLIER ADOPTION TEAM the transition for suppliers becoming an

effective user can be smooth with training support for suppliers at virtually no cost.

The biggest setback that Corporations have is

an initiative for E-INVOICING that brings

suppliers on board with a proficient SUPPLIER

ADOPTION PLAN. When implementing a

successful E-INVOICING initiative it is

highly recommenced that suppliers have NO

SUPPLIER FEES for submitting their invoices. A

no charge supplier policy will help to increase

your SUPPLIER ADOPTION RATE. By charging the

suppliers and loading up on implementation

fees Corporations are limiting the opportunity

for future growth.

Suppliers need to be able to have options that

will improve their efficiency. The end results are being able to provide suppliers the largest

range of tools for ELECTRONIC INVOICING. As suppliers are able to identify those tools and

options the opportunity for an ADOPTION PLAN to becoming a success can be realized.

According to a recent study conducted by IPAYABLES, IPAYABLES surpasses major competitors

in the area of number of vendors adopted per customer.

The research compared the published number of vendors and customers for major players

in the PAYABLES AUTOMATION field. The study shows over 3,350 SUPPLIERS per customer

participating in the IPAYABLES INVOICEWORKS ELECTRONIC INVOICING solution. The next closest

competitor in the study shows only 620 SUPPLIERS per customer.

50% ADOPTION RATE, NOT JUST A DREAM

I was chatting with some folks this week, and we were talking about ELECTRONIC INVOICING,

and the vendor adoption rates that are associated with E-INVOICING. I was stating how

IPAYABLES averages over 70% of INVOICES being received electronically within the first year of

go live, and the people were shocked.

They had been to an ELECTRONIC INVOICING forum the other week and they heard that in the

EU, 20% adoption of ELECTRONIC INVOICING was standard. They were surprised and thought

that it must be even lower in the states because so many people were touting how well

Europe has embraced E-INVOICING. In the good ole US of A, we hold ourselves to a much

higher standard. It is not enough to just implement an ELECTRONIC INVOICING solution and call

it a day. No, we must get the vendors to stop printing invoices and send them electronically

(hence the term ELECTRONIC INVOICING).

If they are printing paper, we have not succeeded and we will continue to strive as a nation

to save our trees and resources and provide ELECTRONIC INVOICING to the masses. Now sure it

is just a few days before the fourth of July, so I may be a tad American centric, but with

where our postal service is headed, I think the less we need to rely on it the better. Let’s

make sure that we are doing all that we can to eliminate the paper process and go to

true ELECTRONIC INVOICING, and not be satisfied with puny adoption rates, or adoption rate$

(that is when an e-INVOICING provider charges the suppliers for the right to send you an

invoice).

So, good for you for thinking about ELECTRONIC INVOICING, and good for you for actually going

about finding the correct E-INVOICING provider, but don’t be fooled by those who tell you

that VENDOR ADOPTION RATE will be less than 50%, or that it is up to you to do your

own VENDOR ADOPTING. That just sounds un-American to me.

ELECTRONIC INVOICING AND 70% ADOPTION RATES

I was speaking with someone who read my previous blog on ELECTRONIC INVOICING ADOPTION

RATES, and they asked me if the 70% figure that I used in the blog was real or was it simply

marketing hype. I let them know that 70% is not only achievable, but it is our

average ADOPTION RATE for the first 12 months of go live from ELECTRONIC INVOICING

IMPLEMENTATION.

We have had customers reach 100% of their internal goal within a year. Obviously when

speaking of averages in the ELECTRONIC INVOICING world, there are ups and downs. One of our

clients took 3 years to get to 85% of their invoices coming in electronically, but they are the

exception, most achieve this much quicker.

Ultimately, the point I was trying to make was that ELECTRONIC INVOICING is exactly

that, ELECTRONIC INVOICING. It is not SCANNING or SENDING PDFS via email. If you are committed

to going with an ELECTRONIC INVOICING provider, make sure that they can achieve the goals

that you have set out, and are not simply window dressing!

ELECTRONIC INVOICING IS ONLY A PIECE OF EIPP

I have been spouting off for a while about the virtues of ELECTRONIC INVOICING. I have stated

how ELECTRONIC INVOICING can make an AP DEPARTMENT, and a whole organization, much more

efficient as well providing for a better planet for our children. EIPP is ELECTRONIC INVOICE

PRESENTMENT & PAYMENT. With ELECTRONIC INVOICING, invoices are presented, coded and

approved in a very rapid fashion. This enables a company to be able to view there liabilities

and accruals much farther out than they were able to before. It also enables them to have

the ability to take discounts like never before as well!

Being able to have better insight and control of your payments is the oft overlooked benefit

of EIPP. DYNAMIC DISCOUNTING can be a huge boon to an organization that is cash rich, and the

ability to change that discounting rate puts control in the Treasurers hands, which they

love. For organizations who are not cash heavy, (or who are straight out cash

strapped) PAYMENT CARDS are a great vehicle to further enhance the roll of ACCOUNTS PAYABLE,

and is another benefit to EIPP. EIPP, if done right with a provider like IPAYABLES, can have

invoices approved in less than 5 days as an average.

When INVOICES are approved that fast, SUPPLIERS are more apt to accept card as a payment

because they are getting their funds quicker, and they are guaranteed the

payment. Certainly not all vendors will take card, but there definitely is a subset of

your VENDOR base that will. You get to use the card as float, and get a nice rebate to boot!

EIPP, ELECTRONIC INVOICING & PAYMENT, will elevate the stature of the ACCOUNTS PAYABLE

DEPARTMENT in an organization. If done with the correct group, it will open up various

options for your organization that could never be dreamt of with paper processing. This is

the wave of the future folks, it is time to get on board!

IPAYABLES 2012 USER CONFERENCE

This week we had our 2012 User Conference in Dana Point, California. Laguna Cliffs Resort

is a pretty nice place, on the bluffs in Dana Point overlooking the ocean. Weather was

perfect and we enjoyed a nice dinner at the end of the conference.

We set aside some time during the conference to talk about new ELECTRONIC

INVOICING functionality and upcoming enhancements to our PAYABLES AUTOMATION solutions, but

most of the time was devoted to user discussions. Users discussed Change Management

strategies and there was quite a wide array of ideas on how best to implement ELECTRONIC

INVOICING and APPROVAL WORKFLOW in large organizations. VENDOR ADOPTION strategies also

varied widely, from contractually requiring ELECTRONIC INVOICING and withholding payment

from non-compliant suppliers to much softer approaches. A discussion of Ad-hoc reporting

allowed users to discuss what reports other companies had created and how they were

using the ELECTRONIC INVOICING DATA, from AUDIT COMPLIANCE to DISCOUNT TRACKING to EMPLOYEE

APPROVAL times. A discussion of DYNAMIC DISCOUNTING and CARD PAYMENTS allowed users to

compare the mix of payment options other users were using based on their organization’s

cash position.

The conference concluded with industry break-out sessions where users discussed

functionality specific to their industry and added input on what might be beneficial future

additions. To those who attended, a heart-felt thank you for your contributions. To those

who didn’t, let me know if you want notes from the conference. The discussions were quite

valuable.

MOVING YOUR INVOICES INTO THE CLOUD

It seems like you can’t mention a technology or business topic without someone suggesting

you move it to the CLOUD. PUBLIC CLOUDS, PRIVATE CLOUDS, private clouds inside PUBLIC CLOUDS,

it really is getting a bit ridiculous. It is unfortunate that the hype obscures the benefits and

the problems with any given approach and makes the decision process unnecessarily

painful.

So what does this have to do with INVOICING? Can you really move your INVOICING into

the CLOUD? The answer is a bit complicated but the short of it is “sort of”. For my purposes

today we’ll limit the definition of “CLOUD” to mean those internet based set of virtual server

and storage resources offered by the likes of AMAZON, MICROSOFT and ORACLE. These

resources can then be utilized by other software or service companies to build and host

applications that actually do things – like INVOICING – on the internet.

Are there companies that AUTOMATE ACCOUNTS PAYABLES built on these CLOUD

SERVICES? Maybe? Kind of? Not really? One company did tout at the recent IFO FUSION

CONFERENCE that they use MICROSOFT’S AZURE CLOUD SERVICES but I’m not sure how that helps

them automate the invoice process. CLOUD SERVICES are used because they scale rapidly,

they are efficient in the sense that you only pay for what you need as a consumer and they

are supposed to be rock solid reliable. But…both MICROSOFT and AMAZON have had major

outages in the last 18 months. IPAYABLES on the other hand, has not. When we started the

company in 1999 the buzzword was ASP – APPLICATION SERVICE PROVIDER.

Then came SAAS – SOFTWARE AS A SERVICE. Now ASP and SAAS are out and CLOUD is in. But

they really are different things. Can you move your INVOICES into the cloud? You could

certainly try. Instead automate your invoicing process with the tried and true leader

of INVOICE AUTOMATION. On the internet since 1999, solid, fast, reliable technical services with

hands on, knowledgeable and capable people services built to automate every vendor and

every invoice. If it helps, you can tell your friends your INVOICES are in the CLOUD.

E-INVOICING, E-SCANNING, EDI OR E-PROCUREMENT: WHAT’S

THE ANSWER?

Corporations are looking for a number of ANSWERS about running their business more

efficiently. Dealing with invoices and how they are processed has become a major topic.

KEN VIRGIN CEO from IPAYABLES was asked about his opinion on this subject-matter. Here are

some of his responses. “Some of the common technologies that have adopted the term

“ELECTRONIC INVOICING” include traditional EDI, SCANNING SOLUTIONS, E-PROCUREMENT

and AUTOMATION SOLUTIONS.”

“Many accounts payable managers who presenting proposals for full automation and

elimination of paper are met with resistance from IT departments that claim, “We already

do ELECTRONIC INVOICING with EDI, just tell your suppliers to do EDI”; or from procurement

departments that have an E-PROCUREMENT solution they feel eliminates all invoice processing

(while, depending on your company, it may only affect 15% of paper being handled by your

accounts payable department); or the SCANNING provider who promised everything would be

electronic, but in reality just moved your clerks from data entry to SCANNING.”

E-SCANNING.

“It is often hard to justify the up-front costs in equipment and the team

of SCANNING employees required when those efforts are so easily outsourced for so much

less. The only time this would really make sense is when low skilled labor is a core

competency of your company.” EDI “For some companies, EDI is enough of a solution. Such

companies can mandate compliance and they don’t have too many small suppliers

where EDI would create a burden. They also have a complex system setup internally to

properly process all of the invoices without too many exceptions. For the company that has

the right supplier base and the IT team to support it, EDI can be very economical.”

E-PROCUREMENT

“For companies where most all payments have a purchase order associated with it,

the PAYABLES DEPARTMENT is usually absorbed by the purchasing department and an E-

PROCUREMENT solution can in theory, eliminate the PAYABLES DEPARTMENT altogether (or at

least this is the vision of the purchasing manager).” Oftentimes, the payables department

continues to process just as much paper as always, but gets shot down every time they

mention payables specific solutions because the E-PROCUREMENT SOLUTION is “almost

there”. But for those organizations that really have moved purchase order processes

throughout the entire organization (value still debated), E-PROCUREMENT can be very

effective.”

“When I hear the term ELECTRONIC INVOICING, or INTERNET INVOICING, I think of the supplier

entering or uploading invoice data into some form of vendor portal or network solution (at

least as it pertains to the receipt of INVOICES in PAYABLES DEPARTMENTS). These solutions are

very payables focused and aim to eliminate paper completely from the PAYABLES DEPARTMENT.”

“They provide or tie into WORKFLOW systems and MATCHING systems to AUTOMATE most manual

functions while recognizing the role of the PAYABLES DEPARTMENT in controlling those functions.

Tie real ELECTRONIC INVOICING with outsourced scanning (for the remaining paper invoices) and

you have a completely PAPERLESS PAYABLES DEPARTMENT with all the controls. Most of these

providers call themselves PAYABLES AUTOMATION.”

ARE YOU READY FOR E-INVOICING?

Today’s post will be centered on being prepared and ready for the day that E-INVOICING will

become a part of your world (if it hasn’t already). Recently a question was asked to

several ACCOUNT PAYABLE MANAGERS, “What was the turning point with your department when

you started to see success with your E-INVOICINGIMPLEMENTATION?” FTE (Full Time Equivalent)

reduction during ramp-up was realized, was one of the prominent answers. Another words

due to reduction of staffing the company was able to save money.

One of the classic responses that I chuckled about, was the answer that I got form one

manager that said, talking about why his department decided not to do ELECTRONIC

INVOICING, ” they are not willing to start E-INVOICING. They feel that they will be losing control if

they are not able to touch the paper that is drowning the AP DEPARTMENT.” Another question

that was asked was, “what are some of the challenges that you deal with to

become PAPERLESS? Answer from a Controller said, “the challenges for my company is

having supervisors, managers and department heads unaware of what it really takes to

process AP and how it can be done with logical controls.”

Here a few of success stories that I wanted to share. One from a Healthcare Company.

“Besides the cost savings, our staff will be able to devote more of their time to our patients

which is our top priority.” Another from a Hospitality Company. “Making payments used to

be time consuming. We had to manually create tasks, use SMART cards etc. Now, as soon

as we get the go-ahead from clients, we click a few buttons and have confirmation in

minutes. The key benefit of AUTOMATING our payments process has been the amount of time

saved, especially at the month end, when we can process up to 350 payrolls in an

afternoon.”

Again I pose the Question. Are You Ready for E-INVOICING?

THE END IS NEAR FOR AP OUTSOURCING

I was reading a blog by Vinny Patel today about how the SAP purchasing of ARIBA may spell

the end for AP OUTSOURCING. (My initial question has to be will this purchase be handled by

the ARIBA NETWORK, and who will be footing the enormous fees associated with anything

going through Ariba) I think that this may be a dramatic over simplification of the impact of

this deal, but the crux is accurate, AP OUTSOURCING is not a cutting edge or even best practice

any more. The same can be said about folks calling scanning ELECTRONIC INVOICING.

AP OUTSOURCING had its place in business; it is just that the time has come where it is no

longer relevant. When manual processes are too costly for organizations, the first

inclination is “Can someone else do this for less?” And next is the question of “Can

technology fix this?” When there is enough critical mass in the marketplace, technology will

come and save the day. This is what has happened with AP OUTSOURCING and ELECTRONIC

INVOICING. AP OUTSOURCING was a solution to a problem, dealing with the high cost of labor,

and ELECTRONIC INVOICING is the solution to AP OUTSOURCING, getting rid of the paper in the first

place.

The funny thing is hearing someone refer to ARIBA and its INVOICE MANAGEMENT tools as the

solution. In my opinion, charging suppliers to invoice you is a way to ensure lousy vendor

adoption rates. One of my clients recently remarked that if she had her vendors submitting

invoices through the ARIBA NETWORK, it would cost the suppliers over $15 per invoice! That is

insane, and probably why IPAYABLES has such a great vendor adoption rate (at NO CHARGE to

the customer mind you) and such high customer satisfaction. AP OUTSOURCING was a great

tool, its time has just run its course, and there are better, less expensive and much easier

to maintain solutions in the market today, and of course the most effective is IPAYABLES

AND ANOTHER ONE BITES THE DUST

Those who look into the crystal ball and try to divine the future really only have to turn

around and look over history to foretell what’s coming. The names are different, the places

different and sometimes there is an interesting twist or two, but history really does repeat

itself.

The IPAYABLES CEO Ken Virgin discussed last week how the absorption

of ARIBA into SAP would NEGATIVELY IMPACT THE E-INVOICING MARKET. Today I want to explore

how ARIBA’S death as an independent company may affect current and future customers.

A lot of that impact is determined by SAP’S true motives in buying ARIBA. Are, as stated

by SAP, they truly looking for a company that has the technical know-how and experience to

deliver cloud based services to enterprise customers?

Does the value of ARIBA to SAP lie in the supplier network or in the data exchanged on the

network? Are the tools and services offered by ARIBA excellent extensions of the software

already offered by SAP, expanding the depth and breadth of SAP’S reach?

Unfortunately only the last option offers any hope that the value customers once sought

from ARIBA will continue. Our friend History is full of examples of the failed grafting of

organizations together; include mergers in the AP AUTOMATION space. Large Company A buys

Small Company B and within a few years there isn’t any trace of the vision, innovation or

spark that brought success to ACCOUNTS PAYABLES DEPARTMENTS and businesses as a whole.

Customers are either left holding the bag or figure out that Large Company A isn’t the same

as Small Company B and looks elsewhere for their AUTOMATION needs.

SAP will probably get what it wants or needs out of the acquisition, but what customers

of ARIBA will get is less certain and if history is an indicator it won’t be great. Oh yeah,

almost forgot to mention that ORACLE finally released their

CLOUD Apps/Solution/Environment/Architecture/Kitchen sink stuff this week. Of course they

acted like they invented the internet and the cloud and no one could do it right before they

came along (Salesforce anyone?).

Anyway, there wasn’t anything in ORACLES announcements that I saw that indicating they

were moving ISUPPLIER more into the cloud or offering a better ACCOUNTS PAYABLE

AUTOMATION service. ORACLE is great at software, but don’t get fooled into thinking that

an ERP tool – of any variety – will AUTOMATE ACCOUNTS PAYABLE by itself. But that’s a topic for

another day…

PAYABLES AUTOMATION/EIPP. JUST DO IT!

About five years ago, a large PAYABLES group was searching for an ELECTRONIC INVOICE

PRESENTMENT AND PAYMENT (EIPP) solution and selected our competitor. They paid a

large IMPLEMENTATION FEE, high monthly and per INVOICE FEES, but the competitor had a decent

product and they were able to reduce the paper in their PAYABLES department and gain

efficiencies and overall cost reductions. At a certain point, the payables group felt it was

prudent to look for a different EIPP solution and after a rigorous selection process, they

selected IPAYABLES.

After switching to IPAYABLES, they were very happy with the fact that the fees were so much

less, there was more functionality and the service levels were higher. But were they sorry

that they had originally selected the other EIPP provider? No.

Even though the other provider had been more expensive and had less functionality, the

solution had reduced much of their paper. They had reduced costs and increased

visibility. They agreed it wasn’t the best choice, but it was still a good choice.

So why would I tell you that some of our competitors are still a good choice? Because it’s

just the truth. Yes, I think we’re a better choice and have a lot more to offer, but there are

too many PAYABLES groups that are afraid to make any choice.

Granted, it’s a pretty big decision. Some solutions are fairly expensive and all of them

should be very high profile projects. But making a good choice, even if it’s not the best

choice, is better than doing nothing.

I can offer some tips, though:

SHOP AROUND FOR LOWER IMPLEMENTATION FEES. THERE HAVE BEEN A LOT OF IMPROVEMENTS IN

THE EIPP AREA AND THE COST TO IMPLEMENT HAS DROPPED SUBSTANTIALLY IN THE PAST FIVE YEARS.

DON’T GO WITH A SCANNING SOLUTION POSING AS EIPP. ASK THEM TO GUARANTEE THAT 50% OR 60% OF

INVOICES WILL BE SUBMITTED ELECTRONICALLY AFTER THE FIRST YEAR. THAT WILL WEED OUT

THESCANNERS WHO USUALLY MAKE MORE MONEY KEEPING THE INVOICES ON PAPER.

TALK TO REFERENCE CUSTOMERS. IT MAY NOT BE THE BEST CHOICE, BUT IF THEIR CUSTOMERS LIKE THEM,

IT’S PROBABLY AT LEAST A GOOD CHOICE.

I’m happy to discuss what I know about the various players that provide ELECTRONIC INVOICE

PRESENTMENT AND PAYMENT solutions.

BRINGING JOBS BACK HOME THRU E-INVOICING

Today many Companies and Manufacturers are faced with a major question. Do

we outsource or do we keep jobs here in America? About six months ago Pres. Obama in

one of his weekly radio talks said, “We should be using our tax dollars to reward companies

that create jobs and businesses within our borders.”

Researching this topic even further there have been both pros and cons. A few month ago

Robert Kuttner, discussed his thought on outsourcing in his article AN AMERICAN

INDUSTRIAL Renaissance. He is the co-founder and co-author of “The American Prospect”

stated that, “As industry becomes more automated (ELECTRONIC INVOICING), it takes fewer

workers to manufacture a product. So even if a Chinese worker is paid just one-twentieth

the wage of his or her counterpart, there is only so much that can be saved by moving

production abroad.”

In the same article it said that, “India’s outsourcing giants-faced with rising wages at home-

have looked for growth opportunities in the United States. But with Washington crimping

visas for visiting Indian workers, some companies such as Aegis are slowly hiring workers in

North America, where their largest corporate customers are based. In this evolution

outsourcing has come home.”

To go along with this thinking a few ACCOUNTS PAYABLE MANAGERS and CONTROLLERS responded

to a survey that they were given recently. Several mentioned that they are still

outsourcing, but the trend is to bring back jobs here to the USA. Outsourcing and in-house

automation (E-INVOICING) is changing very quickly. A VP of finance from a medium sized

national corporation summed it up and said that, “we’ve been testing efficiency and

crunching numbers and are planning to bring everything-in-house again. We would rather

hire people internally than pay another company to do the work we could handle ourselves.”

E-INVOICE INITIATIVE CHAMPION QUALITIES

In a just a few weeks March Madness will be in full swing with division-1 basketball teams

fighting for the prestigious position of playing in the final four. Will it be Duke with Nolan

Smith? Or Kansas with Cole Aldrich? Or Ohio State with Jared Salinger? Whoever makes it

to the final four will have to be unselfish, focused, relentless, work together as a team and

have a belief that they will be there no matter what it takes.

The same holds true for all ACCOUNT PAYABLES DEPARTMENTS that implement an E-INVOICING

INITIATIVE. They need to work together as a team, be unselfish, relentless in what they are

doing and have a strong belief that what they are doing will be implemented for the good of

the company, without fail. Besides having all these traits there are seven others that I

would like to discuss that I believe will either make or break an initiative. These

QUALITIES will help to CHAMPION any AP DEPARTMENT into being a STAR for your company:

1. CREATE A ROAD MAP THAT IS EASY TO FOLLOW. ASSESS WHERE YOU ARE TODAY. IDENTIFY WHERE YOU

WANT TO BE. WHAT TECHNOLOGY FITS YOUR NEEDS? DEFINE PROJECT. INVOLVE RIGHT PLAYERS AND

JUSTIFY THE INVESTMENT.

2. LOOK AT THE TOOLS FOR THE QUICKEST EINVOICE CONVERSION. COMPLETE ACCURATE VENDOR MASTER

CONTACT INFO. NUMBER OF INVOICES PER VENDOR. DOLLARS SPENT PER VENDOR AND ANY “SPECIAL

HANDLING” VENDORS.

3. BUILD A COLLABORATIVE RELATIONSHIP WITH PURCHASING. TRAIN PURCHASING BEFORE”GOING

LIVE”. PUT CONTROL IN PURCHASING HANDS.

4. STRATEGIZE TO GET YOU OVER THE 50% THRESHOLD. COMMUNICATION AND MESSAGING CRITICAL

INTERNALLY AND EXTERNALLY.

5. DECIDE ON YOUR ALTERNATIVES.

6. DESIGN THE SYSTEM.

7. IMPLEMENT AND EXECUTE PLANS AND DESIGNS IN ORDER TO “GO LIVE”.

Just like the teams that worked together and fought their way to be in the final four so too

must ACCOUNT PAYABLES DEPARTMENTS work like a CHAMPIONSHIP TEAM in order to come out on

top with an EINVOICE VICTORY!

HAS THE TIME FINALLY COME FOR DYNAMIC DISCOUNTING?

Cash is king in today’s market place. Suppliers want to get paid as fast as they can so that

they can turn their inventories quickly, and maximize profits. A typical scenario is where a

manufacturer sells at a 30% margin. His cost on an item that he sells for $100 is

$70. When he sells this to his customer, he then invoices (electronically we hope!) and

waits to get paid, on average 40 days later. This means that he is out the $70 in capital

until he receives payment. Therefore he can’t buy the materials necessary to sell another

widget. This phenomenon is why FACTORING has become quite the buzz in the 80’s and

90’s. This has been modernized to a small degree by the advent of PURCHASING

CARDS and SUPPLY CHAIN FINANCE.

PURCHASING CARDS allow for better CASH FLOW FORECASTING by allowing suppliers to get paid

quickly for an interchange fee of around 3%. Many companies are utilizing this as a means

to get their cash quicker, and the customer is happy because they are reaping the benefit of

the rebate on the card. This is all fine and dandy, but who is getting that interchange

fee? The banks and card providers are! What if there was a way to get the same benefits

for all parties, without the middle man? Enter the world of DYNAMIC DISCOUNTING, often

referred to as EARLY PAY DISCOUNTING.

This works exceedingly well when you have an excellent ELECTRONIC INVOICING provider

working with you. By having the invoices electronically, they are able to be approved much

quicker, typically within 4 days. This gives ample time for the supplier to be notified that the

invoice is approved and can be paid early with a discount. The discount in controlled by the

customer, and is typically much less than the interchange rate that the Card providers have

out there.

Suppliers can either opt for the discount, or select a date to be paid and the application will

let them know what the exact discount will be. This makes CASH FLOW FORECASTING more

accurate, and the treasury department is happy all the way around because their cash is

working for both of them! This really is s simple concept and the application of this concept

is pretty simple, as long as you have the correct ELECTRONIC INVOICING and EARLY PAY

DISCOUNTING provider, like IPAYABLES!