Many suppliers are willing to agree to discounts in exchange for earlier payment of their invoices.  But for scores of companies, the financial supply chain is just not equipped to take advantage of the opportunity – missing out on early pay discounts because it is too difficult to change payment terms, or the accounts payable tools simply aren’t in place to offer or accept a change in payment terms. 

Without automation and real-time process visibility, it is extremely difficult for businesses with high invoice volumes to take advantage of early payment discounts. The process can be complex, requiring alignment between purchasing, liquidity management, accounts payable and suppliers. And often accounts payable processes are highly structured and lack the flexibility to process invoices with non-standard “dynamic” payment terms.

The process is called Dynamic Discounting and allows buyers and sellers of commercial goods and services to change the payment terms for an individual invoice or group of invoices to accelerate payment based on a sliding discount scale.  The process is specifically designed to allow buyers and sellers to manage early payment discount offers easily and seamlessly.

Incorporating Dynamic Discounting into our Dolphin AP solution offers our customers a host of additional benefits. It allows buyers to convert a large number of their suppliers to slide scale payment terms and to enable their suppliers to opt for an earlier payment of approved non-discount invoices against a discount. Dynamic discounting functionality enhances supplier relationships, improves the AP department productivity, and facilitates effective cash flow management that can benefit the bottom line.  A win win for both buyer and seller.

It would be interesting to know how many companies are actively using dyanamic discounting, or are looking into it, and what their experience has been.   http://bit.ly/bb7P5c

When the IRS or other tax and regulatory agencies call, are you ready? There was a time in the SAP world that being “audit ready” meant implementing SAP DART before archiving. But for many companies, being audit data ready means having a process in place to enable them to respond at a moment’s notice to requirements and information requests from a dizzying array of tax authorities and regulatory regimes. It is an issue that impacts the bottom line: a multi-national company might expect to pay millions in penalties, simply
because of their inability to report in a timely manner.

Being audit data ready isn’t easy under any circumstances – it takes deep expertise with SAP and the technology solutions available. DART was originally developed to address the need for IRS data extracts, but businesses with complex operations working in multiple tax and regulatory environments – and sometimes multiple SAP systems – often need greater flexibility than DART enhancements can handle efficiently. These companies need to have it both ways – a standardized, repeatable process to index tax-related data, and the ability to respond efficiently to ad hoc requests.

For companies with complex or high-volume audit needs, Dolphin offers a suite of options, from traditional DART for SAP, to ‘on-the-fly’ audit data extraction, delivered in a format the auditors can use to get the job done quickly and effectively.  Learn how companies running SAP are meeting their challenge.

Attended IAPP, IARP, and TAWPI Fusion conference this week in Dallas.  Over four days, 1,600 attendees attended 200 breakout sessions, heard four keynote speakers and browsed the offerings of more than 125 vendors.

One of the keynote speakers confirmed what we’ve been hearing for the last year.  There continues to be cost pressure on businesses, despite the somewhat better economic news, and “finance and AP are being asked to partner with the rest of the business to help drive efficiency and effectiveness”.

As Dolphin’s solutions optimize business process, they continue to meet the objectives of management by cutting costs, managing cash flow, and mitigating risk. Dolphin had 3 sessions at Fusion specically for organizations using SAP as their ERP system – a first for this conference which has focused on the process without regard to the ERP application. The well-attended break-outs  were on:

1. Accounts Payable: Case study on bringing an outsourced shared services ‘home’ and how the new solution optimized the process so that management gained visibiltiy as well as control. The savings were in the milliions of dollars.
2.  The importance the having procurement and accounts payable on the same team when looking at procure=to-pay automation
3.  Opportunities for optimization within the order-to-cash process including order management, cash application, and lockbox processing for those using SAP Lockbox.

Lockbox processing turned out to be one of the hot topics of discussion at both the session and the conference.  While certainly facilitating many aspects of collecting payments and applying cash easier and faster, it also includes some challenges. Not infrequently payments don’t match invoices one-for-one. The handling of this kind of exception can be time and labor intensive process and that adversely affects DSO.  Learn more here.

In a searchSAP.com story, editor Courtney Bjorlin reports that many users are upset about the cost of improving SAP NetWeaver BW performance with its BW Accelerator. In the article, Dolphin’s CEO Werner Hopf offers insight into how to assess your own needs for speeding up queries, and into the need to make your choices in the context of your company’s information lifecycle management (ILM) strategy. The article states:

“BWA is a necessary ingredient once you reach a certain size,” Hopf said, “but implementing ILM and archiving can dramatically improve query performance. A good strategy is to implement nearline storage first and then decide whether query performance justifies a BWA purchase. Organizations may find they can postpone a BWA purchase, or, when using nearline in conjunction with a BWA, at least reduce the sizing of BWA, he said. BWA and Dolphin’s work can also be complementary solutions, where a customer using a BWA can lower the total cost of ownership and maintain performance by incorporating nearline storage.”

Learn more about Dolphin’s approach to speeding up SAP NetWeaver BW queries — while containing cost and risk — here.

To compete, managers at all levels are acutely aware that they must make smarter decisions and quickly take action.  However, many lack the insight they need to make key decisions and are depending on hope that they have made the right ones. But as we know, hope is not a strategy. The statistics below were taken from a recent survey conducted by Accenture:

• 42% of managers use wrong information at least once a week
• 59% of managers miss information they should have used
• 47% of users don’t have confidence in their information

It’s not that they lack the data, but rather they lack the means to derive meaningful information when it’s needed – the right information at the right time in the right place. All areas of business are affected. There is also a need to further analyze this information to uncover new opportunities to grow revenue and reduce costs.   Solutions are available to provide this information both for the business process itself and from business intelligence (BI) solutions with vast reporting capabilities, but implementing these solutions alone is only part of the answer.  To quickly take action on opportunities, these solutions must provide real-time information at-a-glance – easily and quickly.

Business Intelligence (BI) and other data-driven BI applications such as SAP NetWeaver BW help businesses improve transactions and manage massive data volumes.  But technology infrastructure limits how fast you can analyze and get the information you need to make well-informed business decisions.  The higher data volumes you manage and analyze, the longer it takes to get information — the performance/cost ratio becomes a factor that cannot be ignored.  How do you keep performance high while managing costs? Dolphin is seeing success applying innovative nearline storage for BW applications.  Download Dolphin’s whitepaper at  http://pages.dolphin-corp.com/BWArchivingWP.html to learn more.

What’s risk?   Wikipedia defines risk as ‘the expected value of one or more results of one or more future events’. Technically, the value of those results may be positive or negative; general usage tends to focus only on potential harm that may arise from a future event, which may accrue either from incurring a cost or by failing to attain some benefit.

One of the 5 Key risks identified in 2009 by the Institue of Internal auditors Research Foundation was cost/expense reduction and containment risks. Identified in this area are the presence of weaker controls, lack of control oversight and lack of segration of duty controls.  Specifics include not having real-time visibility to information upon which decisions are made.  This is especially true when it comes to financial process such as accounts payable and accounts receivable, order management, and the supply chain. ERP solutons such as SAP  help to mitigate this risk.  Add on solutions that enhance and provide visibility into processes go even farther in removing risk factors.

We attended a presentation last week at SAPinsider Financials 2010 given by Monte Nuckols, supply chain vice president at Johnson Controls Automotive, an $18B JCI business unit. They implemented Dolphin’s accounts payable solution suite to automate, and then optimize, their two shared services centers that service the unit’s 180 plants globally.

 They process 2,500,000 invoices per year, most of which are more than 5 pages with 100 items per page. Before they automated invoice processing, it took hundreds of people just to enter the data. Nuckols said that he had little or no visibility into what was going on with the approval and payment process until the invoices were posted. Some of the results he mentioned were: 

• Lower invoice-processing costs
• Shorter process cycle time down from 10 to 7 days
• Fewer late payments
• Less time responding to inquiries
• Savings totaling millions of dollars

The invoice to pay automation project earned The Chairman’s Award, which is the highest company-wide recognition for Johnson Controls employees.

Glad we were there.

Interesting article this month in Financial Executives magazine on “Whatever Happened to the Paperless Society?”  Predicted in 1978, we clearly are not there, yet the case for going paperless offers a long list of benefits most of which will result in cost savings as well.  It’s a moving target and it is moving forward.  Chaz Miller, director of state programs for the Environmental Industry Associations in DC, wrote that it is doubtful that society will ever become paperless “…but a less-paper society is inevitable”.  Automating paper-intensive operations is a core part of business today and the benefits of improving performance and reducing costs go hand-in-hand with a company’s green initiative.