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Esker drives AP performance at European Motor Distributors

Driving AP performance with cloud-based accounts payable automation…


European Motor Distributors (EMD) is a subsidiary of Giltrap Group Holdings, a large automotive group in New Zealand. EMD import and distribute a range of vehicles from brands such as Audi, Porsche, Volkswagen, Skoda, and SEAT.

Consistent growth over the recent years created a challenging workload for the company’s accounts payable (AP) team.

EMD relied heavily on paper-driven processes. This included manually entering data from the 3,500 invoices received each month in PDF format, into EMD’s financial software. On receiving the documents, the AP department printed out and circulated each invoice for approval. The approval process included verification of the invoice amount and coding. Once approved, invoices were handed back to the AP team for data entry and processing.

This reliance on manual processes and the flow of paper around the organisation created significant challenges such as double-payments and lost or misplaced invoices. There was also an alarming lack of visibility of the AP operations and processes.

EMD knew that their AP process was too slow for a progressive business and were concerned that they had no means to quantify the full extent of the problems.

Read more about this case study:

Start with Why

Have you seen the viral TEDx talk from Simon Sinek titled, “Start With Why”? If it’s been a minute, you can check it out here.

Recently, I was talking with the customer service manager of a leading manufacturer of window glass and doors and we were discussing the “big picture” as it related to his automated order management project with Esker. But more on that later …

I once heard an analogy of Sinek’s talk which stated,

  • People buy millions of drill bits every year not because they want drill bits (the WHAT they need) …
  • But because they want holes (the HOW they’re going to do it) …
  • And they want those holes so they can hang a nice painting over the mantle and check off that “honey-do” list. (the WHY they’re doing something)

When we get into the day-to-day trenches of real life, it’s easy to get tunnel vision and focus on the next task ahead. In many scenarios, this is great! But when considering something like process change within an organization, it’s helpful to keep the focus on the big picture, especially when new technology is involved.

For example, take a solution like order management automation. At its surface, it might seem like an isolated solution for a local problem. However, projects that come to fruition always keep their WHY at the forefront of any conversations with others internally.

Which brings me back to my window glass and door friends: What was their WHY, you ask? When the manager took his action plan back to the organization, he lead with WHY this project was a priority, which broke down like this:

  • WHY: We know we’re growing rapidly and plan to double revenues by 2020. Doubling the team size to scale with increased order volumes and inquiries is not an option.
  • HOW: Therefore, we need to look at how we can make our existing team more efficient. We can do this by using automated technology to perform the low-value repetitive tasks that currently takes up 40-60% of their day.
  • WHAT: We need to eliminate manual order entry. Is there something that can do this? Enter Esker.

As their initiative moved forward, every normal project activity one would expect was still carried out. The only difference? The WHY was kept at the forefront of every conversation.

Do you know your WHY on any current projects?

Fresh Tech: Robotic Process Automation in your Cash Conversion Cycle

Let’s say you’ve just implemented or are considering a customer-facing portal for your order-to-cash process. Good choice! It’s a great way to give customers the convenience of self-service on their time. On the purchasing side, we see companies with significant purchasing power make their purchase orders (POs) available automatically on their portal which is tied to their purchasing system — voilà!

Where it gets complicated

Every customer and supplier has their own portal. This came up on two recent conversations for me on the order management side. A medical device supplier sells to large group purchasing organizations (GPOs) which consolidate smaller hospitals so they have greater purchasing power. It’s a win-win for everyone: Suppliers get large order volumes and the customers consolidate their purchasing power.

Unfortunately, here’s what ends up happening to my medical device friends. After they get a notification that a PO is available, they log into a portal, view the open POs, pull down the PDF, save it, and process it from there. It’s tedious, time-consuming, and very, very manual. Now multiply this by the rest of your customer base!

Another automotive parts manufacturer sells directly to the large automotive manufacturers around the world. Ford, GM, and FCA, given their purchasing power, saved themselves a headache and essentially said, “If you want our orders, come and get ’em.” Ugh.

On the “to-cash” side of the business, we’re seeing a major uptick in customers say things like, “If you want to get paid, upload them to our AR portal.” Customers get the control and visibility of all their outstanding invoices in one platform yet, the supplier is supposed to manage logins and domains for every single one of their customers. My colleague Aaron LeHew wrote an eloquent piece that digs into this topic, which you can read here.

How robotic process automation can help

From AP folks pulling down invoices to pay, customer service teams trying to manage and not miss orders, and even AR teams trying to get paid in a decent time frame, we’ve seen and heard first-hand from customers about the “portal fatigue” in the market.

Esker’s developed Robotic Process Automation (RPA) to a level where it can mimic a human and actually log into a portal and push/pull an order or invoice into said portal.

RPA is great technology for repetitive, constant tasks. Combine that with Esker’s Artificial Intelligence (AI) engine? Now we’re cooking. Allow me to illustrate.

A notification comes in from your customer’s purchasing portal to your central email inbox, Esker’s AI technology extracts the data on the order and understands that you’ve got a new order waiting in the customer portal. Meanwhile, in the portal, the RPA bot is monitoring for a new order and automatically downloads that order to a network folder. From there, it’s automatically picked up, pulled into Esker’s Order Processing solution, routed to the correct CSR, and automatically entered into the ERP system. The Esker AI engine then cross-references those orders pulled down from a portal vs. email notifications to make sure that no orders were missed. This process happens automatically, all the time, in a matter of seconds.

Now that is fresh tech.

AI Making an Impact in Enterprise Supply Chains

Businesses in multiple industries that adopted a proactive AI strategy for transportation and logistics saw profit margins of more than 5 percent, while those without such a strategy lost money.

Artificial intelligence has found solid footing in consumer devices and the retail space. Techniques like machine learning and natural language processing can be seen in personal digital assistants like Amazon’s Echo and recommendation engines used by Amazon and Netflix.

Now AI is rapidly gaining traction in the commercial space, from customer-facing call centers to back-office applications. It’s also reaching into the complex world of supply chain and logistics helping to: automate and streamline various functions, improve shipping times and order fulfillment, reduce costs and bolster profits. When machine learning is applied to inventory and supply and demand, forecasting becomes more accurate, warehouse management is improved by reducing under and overstocking and supplier management is made easier.

All of this means a better return for companies that use AI in the supply chain. According to a survey by BI Intelligence, supply chain and operations is the third most active area for the use of AI, with 42 percent of respondents seeing revenue gains from investments in the technology. Pointing to a McKinsey study, BI Intelligence noted that businesses in multiple industries that adopted a proactive AI strategy for transportation and logistics saw profit margins of more than 5 percent, while those without such a strategy lost money.

There’s still room to grow. In the same McKinsey survey, only 21 percent of transportation and logistics companies had deployed AI solutions at scale or in a core part of their businesses. The field is wide open.

What’s driving AI in the supply chain?

There is a convergence of forces driving the use of AI, not only in the supply chain but throughout the business world. Computing power continues to grow and become more cost effective, and machine learning algorithms are getting more sophisticated. The amount of data generated, particularly in logistics and supply chain, is skyrocketing. This is important, since it’s data fuels the AI machine.

With AI and machine learning, computers can quickly process and analyze these massive amounts of data to find patterns, define context and provide useful information to yield faster and better business decisions. As a result, risks are reduced, forecasting is improved, products are shipped more quickly and SLAs are met. Better shipping routes are found, and order tracking and fulfillment is improved. The end result is more satisfied customers.

While AI in supply chain management is still in the early stages, examples of how it’s being used is growing:

  • An article in the Harvard Business Review found that between 2004 and 2013, Amazon saw operational efficiencies improve and revenue jump 10-fold as the company grew the use of machine learning to help reduce fraud and bad debt and improve product delivery and supplier payments.
  • Splice Machine, which uses machine learning in its big data platform, is partnering with supply chain management technology vendor Intrigo Systems to create applications that will improve customers’ abilities to make better predictions in the supply chain.
  • Logistics firm DHL, in a report written with IBM, outlined multiple AI projects designed to make the company’s processes more predictive, automated and proactive. The company developed Resilience360, a cloud-based risk management platform for the supply chain to give organizations greater visibility into such operations as tracking shipments and monitoring events that could threaten supply chain disruptions. Other programs use AI algorithms and machine learning technologies to more accurately predict delays in airfreight and to look at millions of variables from different countries to better manage containerized ocean and airfreight shipment volumes.

“We believe the future of AI in logistics is filled with potential,” the DHL states. “As supply chain leaders continue their digital transformation journey, AI will become a bigger and inherent part of day-to-day business, accelerating the path towards a proactive, predictive, automated, and personalized future for logistics.”

There are still challenges that need to be met. Data needs to be better managed and easier to access, IT systems need to be updated and investments need to be made. In addition, employees need to be trained in AI and data science, and strategies need to be put in place to handle what happens when automation takes over jobs. Still, the benefits from applying AI and machine learning to SCM will be significant.

Adopting AI and machine learning

As executives begin to bring AI and machine learning into their supply chains, what should they keep in mind? Here are a few things:

  • Start small. Rather than trying to immediately apply the technologies to the entire supply chain operations, find specific pain points that need to be taken care of by AI capabilities. This can include using supply chain management software to automate processes that are now done manually – like invoicing and procurement – or addressing problems that drive up costs and inefficiencies, such as equipment failures or inventory management. Once those challenges are solved, expand the use of AI into other areas of the supply chain.
  • Clean up the data. Without good data, AI and machine learning won’t help operations. AI-based systems can’t think on their own – they need data to crunch. Companies want to ensure the data from their myriad tables and databases is accurate, complete and uniform. It will be coming from a range of systems, including ERP and CRM, so it needs to be tagged correctly. Clean data will mean greater confidence in the results created by the AI systems.
  • Pick the right vendor. AI is still an emerging technology, even though many vendors now are throwing around the terms “AI” and “machine learning” as easily as they once did “virtualization” and “cloud.” Finding the right technology partner is important. Can vendors explain how their products will improve your supply chain operations? Do they have services and support to back up their promises? Can they help identify what needs to be done and what skills are needed? Can they tell you the ROI on using their products? Companies need to do due diligence when picking vendors.
  • Tailor expectations. AI and machine learning hold a lot of promise to make SCM more efficient and cost-effective, but they aren’t cure-alls. Such systems can run through and analyze mountains of data to find patterns, offer greater visibility, provide insights and develop recommendations, but the decisions based on all the information ultimately rests with human beings. Companies need to work closely with vendors to ensure that the technology is being used in ways that will lead to the best outcomes.

We’re in the early stages of bringing AI into the supply chain, but already companies are embracing the technology and achieving results. Businesses need to begin their journey down this road, because those who use machine learning, deep learning, natural language processing and similar tools will see improved efficiencies and cost structures, gain greater business insights and be able to make better decisions more quickly. They will get a competitive advantage over those who don’t use AI. Executives just want to make sure that they’re patient and diligent in planning out the road forward. It’s a journey, so take each step as it comes.

As Worldwide Corporate Marketing and Product Management Director at Esker, Eric Bussy is responsible for the development of strategic products, services and solutions. Eric joined Esker in 2002 as Director of Marketing Communications, and in 2005, extended his responsibilities to include product management.


Capture Supply Chain Transparency Through Automation

It’s difficult to secure what you can’t see, which is why many argue that greater visibility is key to improving the security of corporate networks. Much the same can be said for improving transparency in modern supply chains, particularly ones as complex as those in the electronics industry. In an age of rapid digital transformation in almost every part of the business world and the blurring of the lines between the supply chain, sales, and customer experience, it’s imperative that managers see what is going on at every point in their supply chains.

They need to ensure that orders are being fulfilled correctly and as quickly as possible, that efficiencies are built into every step of the process – from the time the order is made through the interaction with the customer to the fulfillment of the order. A more efficient process can even mean more revenue. Forrester analysts in recent years have said that bumping the customer experience from below- to above-average can mean as much as $80 million in additional revenue.

In addition, the supply chain environment is seeing an influx of new technologies that promise to bring even more changes. Gartner analysts took a look at some of the key trends in the supply chain for 2018 and pointed to the growing use of new technologies to confront industry challenges. Supply chain mangers are adopting artificial intelligence to drive better decision making, predictive and prescriptive analytics for identifying new opportunities, and the Internet of Things to drive better asset utilisation and customer service, not to mention robotic process automation, immersive technologies and blockchain. These technologies all aim to make a complex situation even more fluid.

Just as employees quickly adopted the simple and responsive nature of their Apple or Android smartphones in their work environment, the customer experience is now being defined by the Amazon model – transparency in everything from price to products, a fast and easy ordering processing and speedy delivery of their orders. They can track their orders through delivery and get updates where their orders are.

Transparency is becoming increasingly critical to a business’ operations and applying automation to the supply chain holds the key to driving that transparency. Technologies like AI, robotics and blockchain all will contribute to automating parts of the process, but a fully automated supply chain solution is needed to enable the transparency that is demanded by customers, and that will help customer service representatives (CSRs) better serve their needs.

For customers, automated supply chain management software gives greater visibility into inventory and pricing, which is particularly important for an electronics industry that has had more than its share of price fluctuations and subsequent evolutions of its cost structures. They can better plan their costs and streamline their ordering process, including submitting orders in whatever form they choose, whether it’s through an electronic data interchange (EDI) system, via a fax machine, in an email or over the telephone. By enhancing supply chain visibility, customers can get real-time information about their orders and when they can expect delivery of the products.

Customer service representatives also have better visibility into the order, which enables them to fulfill the order more quickly and with fewer corrections or errors. Artificial intelligence takes data from an EDI order and translates it so people can read it, making verification of the information faster and easier for customer service representatives (CSRs), who can also correct errors and send the order to the fulfillment centers more quickly.

In addition, customisable dashboards help them gain more insight into the customers and their orders and set and track key performance indicators (KPIs). In the end, what’s achieved with supply chain automation solutions is a more visible and transparent supply chain that enables customers to more easily submit and track orders, for organisations to accurately gauge the performance and ROI of their supply chain automation tools and for CSRs to better serve their customers, all of which translates to a stronger relationship between the vendor and its customers.



The Truth About Artificial Intelligence & Its Role in Business

In recent years, there have been amazing advancements in Artificial Intelligence (AI) technology. From the use of ridesharing apps like Uber and Lyft to more complicated (and a little creepy) examples like the robot Sophia.

Most people don’t realize how common AI is and that they use it every day. In fact, when discussing its applications, many people get scared and automatically think of scenes from movies like “I, Robot” or “Terminator” — others get excited thinking of scenarios closer to The Jetsons. Neither are wrong, per se, but both are pretty far-fetched.

The Truth About AI

It’s not scary, I promise. It’s actually a pretty incredible technological revolution that we are witnessing. We’ve got a front-row seat to technology that becomes smarter by itself rather than relying on humans to continually program it. And no, I don’t mean smarter like take-over-the-world smarter. By smarter, I mean learning what it should be doing or could be doing better and then achieving that.

A few examples of commonly used AI tools are:

  • Spam filters: They continuously learn what messages to mark as spam based on machine-learning algorithms that take into account words in the message, where it’s sent from, who sent it, etc.
  • Mobile check deposits: Offered by most large banks, this technology relies on AI and machine learning to decipher and convert handwriting on a check into text.
  • Facebook: That nifty feature that identifies people in your pictures uses AI to power facial recognition software.
  • Voice to text: A standard feature on smartphones, speech-recognition systems that transcribe your words into text require … say it with me now … AI.

See? Not so scary.

How It Benefits Business

With how much AI benefits our daily lives, it should come as no surprise that it is also beneficial in the workplace. Heck, we already use some of the tools mentioned above to help us in the workplace. But how exactly does AI promote better business?

  • It allows staff to focus on what’s important. Rather than focusing on menial tasks that don’t add value to the organization, employees can skip to the activities that do. For example, instead of manually organizing and entering documents, an automated solution allows staff to focus on serving customers.
  • It creates greater efficiency. Thanks to its ability to learn over time and take over tedious tasks, greater efficiency is achieved.
  • It empowers customers. Self-service options are often powered by AI technology, emboldening customers to do things themselves — something that most customers prefer.

In the next five years, investment in AI and human-machine collaboration is estimated to boost revenues by 38% (Accenture). Will you be one of the companies profiting from it?

Top Tips for a Successful Implementation: Advice from Esker Customers

So you’ve done it. You’ve made your case, convinced the higher-ups, and have finally decided to implement a document process automation system that will help propel your company’s digital transformation journey. Congrats!

Now what?


Preparing to go-live with any new software solution can often be a stressful period that seems to take far longer than it actually should. We try to make the implementation process for our customers as easy and painless as possible, but it always help to have aligned expectations and goals. So we asked some of our current customers, both new and old, about what they wish they would have known back when they started their implementation. Ready to take notes? Here’s what they said.

Phase One

“Make sure the needs of the company are mapped out.  Know what you want as a final product.” – Dan

“Build your solution for the future – if there are possibly different order types, scenarios or acquisitions that may happen in the future, plan for them.” – John

“Make sure everything is flexible that can be flexible. That way if you change your mind/policy/procedure you don’t have to try to change functionality at a later point.” – Kelli

“Find a company that uses the same software you use and see if there are tips and information that can be shared to help with the implementation.” – Susan (our Esker All Access customer hub is a great place for this!)

Phase Two

“Use a smaller group of SMEs to get Esker implemented. Then have those SMEs translate the process into your business practices and teach everyone else. Too many people trying to get involved from the start can slow the implementation process.” – Eric

“Allow Auto Learn to do its part.  Give it time and try not to rely on Teach.” – Candie

“Test everything! Every possible situation!” – Heather

Phase Three and Beyond

“Customizations aren’t as big of a deal as you would think they are.  A lot of major and minor adjustments were easily implemented by Esker in our early increments!!”- Krystle

“Always keep your options open and go with the Agile approach to implementing a solution. You never know, you may be satisfied with less…” – Chris, Sales Guy

“With Esker Order Entry, we were well prepared by the Esker team to focus on change management and by “seeding” some experts (power users/trainers) in the rollout group.  It was very good advice.  We put a rollout schedule together that, as it turned out, was unnecessarily conservative.  We accelerated the rollout when we realized that the prep work we did was well executed.  We are bringing up our second business now and – being more confident – we will plan for a more rapid deployment with this one.” – Tom

“We would do less teaching up front and inspect early on for consistency in processing with reps. We have since explained to reps that working in Esker is like having a four year old from that Rodney Atkins song; ‘I’ve been watching you dad, ain’t that cool?…I wanna be like you…I wanna do everything you do, so I’ve been watching you.’ Esker wants to do everything we do and be like us. If we do something wrong, Esker will learn wrong. If we are inconsistent, Esker will be inconsistent. In the Rodney Atkins song, the four year old learns a four-letter word from his dad and it shocks him. When Esker does something wrong, we need to examine our actions in Esker and look for improvement in accuracy and consistency.”  – Titia

With the right amount of training, collaboration, and organizational buy-in, a software implementation and the corresponding results can be the best thing that has happened to your business. And of course, having a reason to throw a Go Live party never hurts either.

Thinking about implementing a new software system? Click here to learn more about Esker!

Today’s a Good Day for Automation

Most companies face a wait time receiving customer payments that could range anywhere from 30 to 90 days to even longer. Payment delays not only cause anxiety for the collections management team, but they impact your cash flow. The bottom line is simple — the more quickly you collect your accounts receivable (AR), the better your cash flow situation will be.

You have undoubtedly heard about or have automated certain business processes already. By automating wherever possible, you’re looking where you can leverage technology to compliment your existing ERP or finance solution, and reduce labor-intensive administrative tasks, thus operating much more efficiently in the process. AR automation transfers invoicing to a digital process, sets you up to receive multiple forms of payment, handles what is usually labor-intensive deductions, accurately applies cash, and captures and prioritises collections efforts. In addition, AR automation allows you to:

  • Create customer invoices based on your company’s data or simply upload an ERP created file of invoice PDFs to send and track electronically or via postal mail
  • Send automated reminders for payment

Finally, AR automation also supports numerous types of collections strategies and is set up for internal collectors based on the collections rules and approach unique to your company.

The benefits of AR automation are numerous and impossible to ignore after you have experienced them firsthand. Here are the main reasons to consider implementing this year:

  1. Faster Payments
    If you’re accustomed to dealing with clients who tend to pay your invoices at their leisure, then you’re not alone. This is just one of many reasons to consider automating your AR processes as soon as possible. The enormous benefit of automation is that e-invoices are made available for customers to pay immediately. This eliminates delays in payment that might have previously been common. AR automation can help you speed up your invoicing so you get faster payment.
  1. Improved Customer Experience
    A benefit of AR automation is an enhanced customer experience. Your team is better able to focus on more strategic and detail-oriented tasks. When it comes to AR-related customer data, you know the more you can do to merge things for greater visibility, the better customer service you can provide. When it comes to inaccurate invoices or collections issues, AR automation technology allows you to quickly address any issues that may arise. By implementing technology in your AR processes, you are giving yourself a valuable tool that allows you to provide stronger customer service. Because of this enhanced customer experience, you can expect improved customer retention and a decrease in customer service-related problems.
  1. Cost Savings
    Studies have shown that e-invoicing saves approximately $8 per invoice sent. This cost reduction might come as a surprise. However, the decrease reflects cost savings in several areas, such as postage costs, manual handling of paper invoices, cost of paper, envelopes, and equipment used in the printing and posting process. By implementing invoice delivery automation, your company can cut costs where you never could before. In time, the sizeable cost savings will be worthwhile to leverage technology to your benefit.
  1. More Control & Visibility
    Another benefit of AR automation is the added control and visibility you and your team will gain. Invoicing and international e-invoice compliance, automated payment reminders, online customer payment, automatic cash application, collectors outreach and workflow, and capturing dispute reasons are just a few of the AR automation functions that allow real-time visibility and reporting. Improved visibility provides insight you and your team can act on.

You may still have reservations about making the switch. The manual processes you’ve always known feel comfortable and familiar. Change can sometimes be scary. Look at automation technology as something that can easily be adapted to your business needs. Opt for software that’s simple, intuitive and closely matches how you already do business. Consider automating your AR and collections process — it’s a more predictable and repetitive sequence of activities that provides benefits from end to end.

Automation Software Improves EDI in Electronics

It wasn’t that long ago that moving business documents between a company and its partners or customers was a complex, time-consuming, and cumbersome process. It was a highly manual effort, with documents from purchase orders and invoices to receipts and payments exchanged through such means as emails, faxes, and traditional mail. On each end were humans inputting the data into their computing systems and handling the transmission of the documents. And as with most manual processes, it was slow, inefficient, costly, and error-prone. Mistakes in data entry were common and the pace of processing the documents could not keep up with a modern business environment that was moving at increasingly fast speeds.

Enter electronic data interchange (EDI). EDI began coming onto the scene about three decades ago, promising to move the business of processing documents from a manual to a digital one. It shifted the equation by making the exchanging of business documents a computer-to-computer process rather than a manual one. Accuracy and efficiency improved, processes accelerated, costs were reduced and security increased. In a fast-moving and volatile market like electronics, EDI was a breath of fresh air.

That said, for all the improvements EDI made in the document exchange process, it hasn’t been a cure-all for everything that ails the semiconductor industry and how business is done there. Even with EDI, there are still complexities and challenges that can slow down the system and create inefficiencies. There are multiple EDI formats and standards – EDIFACT, ANSI, XML and UBL, to name a few – and the process involves running data entered in a system by one organisation and running it through a series of translation, mapping and processing steps, where multiple points of error and exceptions lurk that can introduce costs, create inefficiencies and be a drag on the system.

When exceptions occur, customer service representatives (CSRs) often have to call in the IT team to fix the issue, which means the company is paying two people to manage a single problem. Exceptions also can have a domino effect up and down the supply chain and the myriad stakeholders involved and can damage relationships between an organisation and its partners. For a rapidly changing electronics industry that sensitive to pricing and revenue fluctuations, EDI exceptions can make life that much more difficult.

This is where automated order processing software can help alleviate many of the problems stemming from EDI exceptions. Solutions that integrate with an already existing EDI can help reduce the costs that come with EDI exceptions, simplify how formats and systems are managed and complement an existing EDI infrastructure. An order processing automation solution acts as an overlay of the EDI system, translates orders into a human-readable form and ensures that there is full visibility and control over every order.

With such EDI integration solutions, the handling of exceptions also is automated and can be resolved by the CSR, eliminating the need for an expensive IT professional to fix a problem.

Using automated order processing solutions can help with EDI orders and exceptions in multiple ways:

  • EDI orders can be treated and processed like any other order, like fax, email or paper. In addition, invoices can be sent through whatever channel and transport protocol – like AS2 or SFTP – the customer prefers.
  • CSRs have greater control and visibility over not only the orders but also the customer and partner relationships. They can verify and make corrections to orders, start the workflow, better manage SLAs and orders, and spend less time on paperwork and more time working directly with customers and partners.
  • Efficiencies are improved, and costs are reduced. With an order processing automation solution, the time spent processing EDI orders is reduced by an average of four days over when there are manual steps in the process. According to one company, the introduction of order processing software reduced its order processing time by 50% and kept an accuracy rate of 99.5%.
  • By reducing the amount of human intervention in the process and the errors that come with manual intervention, order processing automation improves the security of the data that is passing between an organisation and its customers and partners.

EDI was a significant step forward in streamlining the processing of exchanging business documents and was an improvement in electronics business software. It moved the dial on the digitisation of order processing and management, reducing many of the challenges that come with manual processing. But there were still inefficiencies, complexities and exceptions involved with EDI, many of which can be addressed through the use of order processing automation solutions to improve and complement EDI infrastructure.



Handling EDI Exceptions Through O2C Automation Solutions

Manual processes were not meant for the increasingly complex and interconnected manufacturing supply chain that we have today. In an industry that over the past couple of decades has embraced just-in-time (JIT) and lean manufacturing best practices to increase speed and efficiency, having an order-to-cash (O2C) cycle that relies almost entirely on human input won’t cut it. As with most manual systems, the cycle from the time an order was made to when payment was received was slow, inefficient, error-prone and costly. Data entry mistakes were commonplace and document processing was unable to keep up with the pace of modern commerce.

Enter Electronic Data Interchange (EDI). The introduction of EDI, which has been around for about 30 years, transformed much of the O2C cycle from a manual process to a digital one, making the exchange of documents one done between computers rather than through human intervention and paper. EDI accelerated the entire process and improved accuracy, increased the security of the documents and reduced overall costs. The O2C cycle is a crucial one in business, as it’s the core of the relationship between a manufacturer and its many customers and partners. It’s where orders are made, products are built and shipped, invoices are sent and payments are made. If shipments are late, products are returned, or payments are missed because of human error or a slow process, relationships can fray, business can be lost and profits can suffer.

EDI greatly improved the order-to-cash cycle. With EDI, data that the buyer has entered to the system goes through a range of translation, mapping and processing steps before an order is processed, an invoice is sent from the manufacturer or a payment is made by the buyer. It’s a much better option to manual processes, but it also presents its own set of challenges. It can be complex — there are multiple EDI formats and standards — and there are various points throughout the cycle where errors and exceptions can occur, which can impact accuracy, drive inefficiencies and add costs. This complexity can make the O2C process a bumpy one.

For example, we’ve found that about a third of EDI orders contain exceptions due to such errors as incorrect pricing, wrong promotions codes, missing segments and invalid material numbers. Fixing these issues can cost time and money, and often means that customer service representatives (CSRs) — who should be working with customers — instead have to bring in IT to fix the problem. Now there are two people being paid to address a single problem. It’s inefficient and expensive, and precious time is wasted. Such exceptions can negatively impact multiple points along the supply chain, causing inaccuracies and inefficiencies throughout. EDI has been a vast improvement over manual processes, but complexity and challenges remain.

This is where automating the highly complex O2C cycle comes into play. Within any business, there are multiple departments, teams of employees and technologies that make up the order-to-cash process, and keeping them in sync is no easy task. A glitch here or there can lead to problems throughout the chain and result in everything from slower order fulfillment times and delayed payments to unhappy customers.

Automated solutions can eliminate many of those glitches that can cause so many problems, as well as remove many of the challenges presented by EDI exceptions to ensure the accuracy, efficiency and security of the entire O2C process. EDI integration solutions can work as a replacement or complement to the EDI system and touches all parts of the larger O2C cycle. An automated accounts receivable (AR) solution can automate the entire process of delivering and archiving customer invoices and ensure the delivery of invoices through any avenue, whether that’s paper, e-invoices or EDI. Invoicing is not only accelerated, but accuracy is ensured, and costs are reduced. Automated AR software can generate invoices in multiple EDI formats, such as XML, EDIFACT and ANSI, and send invoices in whatever manner the customer wants, whether its through the mail or via email, EDI or the customer portal.

For order processing, an automated solution becomes the place where every order is processed, whether it’s received via EDI or email, fax, paper or any other route. The orders are forwarded to the correct CSR and the data is collected and used to create a sales order in the ERP system. Every order is readable to humans, giving CSRs greater control and visibility into those orders, and any discrepancies or issues within the order can automatically be detected and feedback provided to the business partner to be corrected.

Automation also encompasses the handling of EDI exceptions. The data from an EDI file is put into a PDF and problems can be quickly found and flagged. At the same time, the automated solution can take what it’s learned from previous situations to automatically correct issues that continue to occur by remembering changes users had made previously, which speeds up the process, improves accuracy and efficiency, and reduces the number of exceptions that need to be addressed. It also means that the CSR has total control over the handling of EDI exceptions, eliminating the need to bring in an IT technician for help.

This all leads to stronger relationships with customers and partners. With an automated O2C process, CSRs can easily and quickly track orders and address customer issues through a single interface. With automation software in place, they have more time to spend working closely with trading partners and selling more products. They essentially have more time to spend doing the job their title suggests.

The O2C cycle in the manufacturing industry is a complex one, from the time an order is made to when invoices are sent and payments are received. The business world is changing rapidly, and manual processes simply can’t keep up. EDI has been a vast improvement, but even with these systems, exceptions can mean more human intervention, which can slow things and cause a lot of pain throughout the supply chain. Automation software eliminates those issues by quickly and easily addressing exceptions and ensuring a single system for all steps of the O2C process, speeding up the cycle from order to fulfillment, invoice and payment, reducing errors and increasing efficiency and, most importantly, creating a highly positive customer experience.