find your way to success case study electronic invoicing...
TRANSCRIPT
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Find Your Way to Success
Case Study
Electronic Invoicing in Upstream Oil and Gas
And Industry Trends
Presented to:
Software AG Supply Chain Forum
By:
Ken Schmitt
Techstone Technology Partners, LLC
September 23, 2009
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Electronic Invoicing
Customer Business Drivers / Objectives
–Eliminate paperwork and data entry errors
–Reduce the cost of data entry from paper invoices (Time and Personnel)
–Automate invoice approval process so it consumes less time from “highly-paid professionals”
–Balance the books accurately and on time
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Electronic Invoicing
Customer Business Drivers / Objectives (cont.)
–Mitigate risks through contract compliance• Obtain supplier contract compliance
• Comply with contracts themselves (pay on time)
–Eliminate rogue buying practices
–Improve corporate controls by standardizing processes and auditing
–Improve access to data for improved decision making
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Electronic Invoicing
Supplier Business Drivers / Objectives–All of the Buyer objectives
• We want to be a valued business partner by helping our customers achieve their objectives
• We have the same objectives with respect to our suppliers
–Reduce DSO by getting paid within contract Terms & Conditions• Errors and inefficient paper invoice processing methods are primary causes
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Electronic Invoicing
Two methods of eInvoicing–System to System (Direct Integration)
–Presentation via web site (EIPP)
–Both are needed to satisfy a diverse customer base
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Electronic Invoicing
System to System
Direct Integration
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Direct Integration eInvoicing
Fundamental Requirements–Establish internet communication channel
between our ERP systems (Integration Hub)
–Receive electronic Purchase Orders (optional)
–Send electronic Invoices
–Send electronic Field Tickets• Scanned,signed copies or XML w/Digital signature
–Publish contract pricing to the customer• Require line-item unit pricing
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Direct Integration eInvoicing
Fundamental Requirements• Must have Integration Software (Middleware)
– webMethods
• Must have Computer Infrastructure to support the software
• Both trading partners must have the capability– Build it within the organization– Outsource this requirement to a third party (Networ k)
• Several companies available
• Adoption of Standards
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Direct Integration eInvoicing
Adoption of Standards is Essential• Data Formats (XML – Extensible Markup
Language)– Word, Excel, .pdf are not acceptable
• Transmission Protocols (HTTPS, AS-2, RNIF,.)
• Standards adoption minimizes the initial development and ongoing maintenance costs
• Standards for the E&P Industry– API PIDX Standards Organization
– OFS Portal
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Standards for Direct Integration eInvoicing
API PIDX• Vision - to be the global electronic business
standards for the oil and natural gas industry and its trading partners
• Mission - provide a forum for delivering the process, information, and technology standards that facilitate seamless, efficient electronic business within the petroleum industry and its trading community
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Standards for Direct Integration eInvoicing
API PIDX Membership• Baker Hughes
• BJ Services
• Cooper Cameron Corporation
• Chevron Corporation
• ConocoPhillips
• Defense Energy Support Center
• DIcentral
• Digital Oilfield
• DTN
• Eiro Consulting
• FMC Technologies, Inc.
• Green Tweed
• Halliburton Energy Services, Inc
• Logistics Management Institute
• Liquid Frameworks
• M-I Swaco
• Murphy Oil Corporation
• OFS Portal
• Oildex/TransZap, Inc.
• Quadrem
• SAP Global Marketing
• Schlumberger Technology
• Shell International B.V.
• Smith International
• Total S.A.
• Tansport 4
• Vetco Gray
• Weatherford International
• Wellogix
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Direct Integration Scenarios
Trading Partner
(Supplier)
Trading Partner (Buyer)
Trading Partner (Buyer)
Trading Partner
(Supplier)Network
Trading Partner (Buyer)
Trading Partner
(Supplier)NetworkNetwork
Simple to Complex
Relationships
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MyCo Integration Hub
Customer
Customer
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Case Study: Direct Integration Invoicing
Current eInvoicing Activity• 3,000 Invoices per month
• $90,000,000 per month
• 20 customers being eInvoiced
Future• Demand continues to steadily grow
• More than 20 additional customers getting setup or waiting to be set up
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Electronic Invoicing
Invoice Presentation via web site
EIPPElectronic Invoice
Presentment and Payment
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EIPP Services EIPP Services -- OverviewOverview
• A collaboration software tool that enables MyCo to present invoices to our customers for routing, review, dispute, approval and payment, replacing the more costly, traditional paper-based invoice processes.
• Accelerates invoice to payment, and automates dispute resolution.
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MyCo Integration Hub
Customer
Customer
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What Does EIPP Offer?What Does EIPP Offer?
• List Open and Past Due Transactions with Line Item Details
• Identify where Transactions are in the Payables Process
• Record Promises to Pay
• Provide Scanned Invoice Images
• Provide Scanned Proof of Delivery
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What Does EIPP Offer?What Does EIPP Offer?
• Log and Distribute disputes that are created at header and/or line item level
• Customizable Reconciliation Workflow
• Payment Strategies & Rules
• Enhanced Collaboration Between MyCoCorp. and our Customers
• Customer has Real-time Access
• Integrates with existing ERP applications
• Integrates with eInvoicing Integration Hub
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EIPP Case Study Performance
Current eInvoicing Activity• 22 Customers using EIPP today
• $5,000,000 per month
Future• Demand continues to steadily grow
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Electronic Invoicing Benefits
“Every time we have enabled a customer with eInvoicing, we have realized better pay performance” (Doug Dunlap, Director Credit and Collections) Positive impact on DSO.
Also results in:
• Improved Customer Relations
• Increased Labor Efficiency
• Reduction in total $ per Invoice Processed
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eCommerce Evolution
• Fundamental guiding principle for success is:
e-Business is business …...business that is automated
and enabled with web and digital technologies.
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Industry Trends
• Increase in heterogeneous environments
• Need for integration
• Multi-process/Multi-operational
• Complex supply chain processes
BPM is the answer
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Business Process Management
• Procurement/Sourcing
• Product Returns
• Logistics Visibility
• Supplier Performance
• PO Auditing
• Demand Monitoring
Supply Chain
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Industry Trends
• Increased need for visibility
• Supplier Chain Mgmt. needs clear view of business processes
• Need to analyze and use data productively
• Need for real-time monitoring, optimizing and repor ting
BAM is the answer
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Business Activity Monitoring
– Process spans more than one application and organization
– Required end-to-end monitoring of processes & transactions
– High potential for business exceptions, errors, & unfavorable conditions
– High transaction volume
– Business activities are strongly driven by date/time requirements
– High exception management cost
– Strong need for measurement methodologies; e.g. Six Sigma
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