Success Story

Brose Fahrzeugteile GmbH & Co. KG, Coburg

Automating Invoice Processing with an Integrated Approval Process

The goal of XFT’s project with automotive component supplier Brose was to complete incoming invoice processing in a central system and to supersede any paper involved – in order to accelerate invoice management and approval and make these processes more transparent. XFT Invoice Manager achieved this with great efficiency.

The Challenge

The Brose Group supplies more than 80 vehicle manufacturers and 30 suppliers throughout the world with mechatronic systems and electric drives. More than 19,000 employees work for Brose in 23 countries at 53 locations, and the company operates on all major automotive markets. In the fiscal year 2011, the Brose Group generated sales of more than € 4 billion.

Since 2002, a shared service center in Hallstadt, Germany, had been responsible for accounting at Brose’s seven German locations. Although around 95 % of the vendor invoices are cleared directly in the SAP system using credit memo procedures, the shared service center still had to process more than 60,000 incoming invoices a year.

Since 2003, the invoices had been scanned after approval and archived electronically. However, they were checked and approved using paperbased workflows. This meant that invoices were often on and between various desks within the company for days, sometimes weeks. And occasionally, some of them even disappeared for ever.

To tackle this issue, the Automated Invoice Receipt Processing project was initiated in 2008. Its goal was to complete incoming invoice processing in a central system with no paper whatsoever – in order to accelerate invoice management and approval and make these processes more transparent. xft invoice manager achieved this with great efficiency.

Because Brose was already working with software solutions for scanning and archiving invoices, the company began searching for a product that, first, would dovetail with them easily and, second, ensured good integration with SAP. Finally, Brose opted for xft invoice manager, an SAP add-on from Walldorf-based XFT GmbH which specializes in solutions for document and process management in SAP. XFT Invoice Manager works with all established scanning and archiving solutions. Another factor was that other xft products had been in use at Brose for some time and had proven to be both flexible and reliable.

The Solution

Structure of the Solution

At the heart of XFT Invoice Manager is the central invoice receipt monitor, from which accountants working in invoice verification have an overviewof all invoices to be processed and can control the entire process centrally, from parking through release and posting. Hooked up to XFT Invoice Manager are a scan client (Kofax) and an SAP archive system for audit-compliant archiving of the scanned and processed invoices.

Invoice Receipt

Using the SAP standard interface ArchiveLink, the data – which was extracted from the scan client by OCR and prevalidated – is transferred to XFT Invoice Manager together with the original scan. For each scanned invoice, XFT Invoice Manager generates a separate SAP workflow in the central invoice receipt monitor and automatically determines the accountant responsible using the SAP vendor master data. At the same time, XFT Invoice Manager performs additional data verification, for example, it checks whether the creditor data in the system is complete. In the meantime, the digitized original invoice is stored in the SAP archive system as a PDF document.

Invoice Processing

XFT Invoice Manager automatically fills the invoice instance in SAP with the data extracted from the scan client. It then checks whether the conditions for automatic posting have been met. If not, the invoice is parked in SAP and its status is displayed accordingly in the invoice receipt monitor. In addition, the PDF of the original scanned invoice is automatically linked to the parked or fully posted SAP document.

From the invoice receipt monitor, the accountant triggers the approval workflow at the touch of a button. The system automatically suggests that the SAP user who placed the related order should be the approver, but the accountant can also select any other user in the system. Furthermore, there is a field for notes, where users can select a suitable text from various standard texts and add it to the workflow.

The approver now receives the invoice PDF together with the request in his or her inbox in SAP Business Workplace. At the same time, he or she gets an e-mail with a link that enables the invoice to be called using the SAP Web interface from outside the system and displayed in a Web browser. To process the invoice, there are three options:
1. release,
2. reject,
3. forward.

If the approver does not release the invoice, he or she must state the reason why in the field for notes. The accountant then incorporates this reason into the letter that is sent to the vendor along with the rejected invoice. If the approver forwards the invoice, this information is displayed in the invoice receipt monitor as a new workflow step and the current agent is displayed. As a result, the accountant always knows where exactly the invoice is.

If an approver does not react within two working days, the system automatically sends a reminder mail; and a second reminder is sent after two more working days. When the third reminder is sent – after three more working days – the person‘ s manager is informed as well. The manager is identified using SAP organization management in SAP HCM.

Highlights

Transparency
The approval process is completely transparent during processing and can also be traced well in retrospect. A particularly important feature is the solution’s ability to determine precisely who released the invoice.

Availability
All the information is available centrally and fast – including for the company‘s more remote locations, who previously had virtually no access to invoice documents.

Data Quality
The quality of the vendor master data in the SAP system has improved considerably since the system was implemented. Because an invoice can only be validated if the vendor master data is complete, the purchasing department now checks the vendor master data when it places an order at the latest, and adds any missing data, if necessary. The entire company benefits from this, not just the accounts department.

Time Savings
The processing time for invoices has been reduced drastically. Automatic posting alone, which covered merely 10 % of the invoices since it was implemented, saves a few hours working time a week. This enabled the shared service center to gradually extend its services to other locations, without overburdening the existing team of accountants with the growing volume
of invoices.