Fast Cash: How to Speed Up Invoicing

RTC had a fervent desire to cut time from its cash collection process. That’s a desire that many companies spend countless hours and dollars trying to realize: Everyone would like to get paid faster by customers. This privately held Chicago-area company (with about $150 million in revenue) specializes in retail marketing systems, providing services ranging from store design to fixtures, for clients such as Anheuser-Busch, Hasbro, Gillette and Target. RTC knew that it took too long for its shipping information to hit the accounting group and then customers, says Scott Coffman, RTC’s director of information services.

The company ships two ways, sending small packages directly to customers via the usual shipping services, and sending larger, full-truckload shipments from its loading docks right to customers. When a truckload of product left RTC’s shipping docks for delivery, an unwieldy internal process began, Coffman says. A full-truckload delivery meant the company created a bill of lading document that needed the driver’s signature, the truck number and related details. “That was difficult to capture,” Coffman says. “It was very manual.” Those bills of lading were scanned, sent to accounting, collated and matched up to invoices, which were then mailed out. The whole process took about two days.

“We struggled for years with this,” Coffman says. “We tried Adobe, Web pages, you name it. When a driver hits our dock, they’re under the gun. We were unable to capture the signature and match it up to the necessary documents quickly. It took too many steps.”

In the summer of 2006, RTC began an order-to-cash initiative to take a fresh look at the cash collection problem. A cross-functional group, including IT, accounting and finance team members, mapped out the related processes and looked for bottlenecks, Coffman says. “This supporting documentation piece [involving the bill of lading] stood out,” he says. In October 2006, RTC did an ERP conversion, choosing Infor’s ERP platform. At this time, the company also implemented StreamServe’s enterprise document presentment technology (specifically, the Connect for Infor product) to better automate its handling of purchase orders, invoices and related shipping documents.

The ERP rollout went off well and on time in October, Coffman says, and the StreamServe technology started helping simplify invoices for customers and internal documents for RTC employees. (Among other capabilities, StreamServe can customize or skinny down internal documents for internal groups, customers or business partners.) But it was a while, he says, before “the lightbulb went off.”

About six months after the rollout, Coffman’s team realized it could connect its homegrown .Net application, which captures the driver’s signature (via an electronic gadget akin to what consumers sign for UPS), to StreamServe.

“We were able to separate the signature and the bill of lading,” Coffman says. “That was the key piece.” Here’s how the new process works: The driver signs a document that states what the bill of lading will contain. Then RTC creates a separate document (the official bill of lading) and stores it in StreamServe. When RTC’s invoicing staff generates daily billing requests, StreamServe gets queried, and the company creates the invoicing documentation and supporting information in one swoop, Coffman says.

Lesson learned: Since ERP implementations are incredibly complex, you may initially overlook a “gem” of a capability either in your ERP package or in one of your third-party applications that connect to ERP, Coffman says.

“After the implementation, go back over your original assumptions,” he advises. “Sometimes, applications have hidden aptitudes.”

Extending StreamServe to talk to the homegrown .Net app cracked the invoicing bottleneck problem, Coffman says. “What’s impressive is how quickly it came together,” he says, noting that the IT team rolled out the new system within a week.

“Stepwise, we probably cut the process by 50 percent,” Coffman says, the process being the time from shipment generation (when the driver hits RTC’s docks) to invoice mailing.

The experience reinforced Coffman’s belief that for companies like RTC, which don’t have huge IT organizations, a key requirement for an ERP package is that it wont present integration hassles with third-party applications.

“Our model is to select vendors that have deep support and deep consulting offerings to bring to the table,” Coffman says. “We run fairly lean so we try to pick strong people to extend IT. Our job is to understand the business; the partner helps us solve the puzzle.” RTC has about 500 employees, about 15 of them in IT, he says.

Combining a document processing revamp with an ERP rollout is not yet a common occurrence in enterprise IT, says China Martens, a senior analyst covering CRM and ERP software for The 451 Group. “It’s one I’d keep an eye on,” she says. Due to the scope of an ERP makeover, many companies delay decisions regarding new third-party apps, she adds.

If you do want to revamp document handling at the same time as your ERP system, an ERP vendor’s services team will be all the more important to you, she adds. “If you’re getting a lot of help with the ERP system, maybe that makes it easier to do work like this on the side.”

What other third-party apps should IT execs think about with regard to a likely future desire for tight integration with ERP? The mix of these apps will vary greatly by company and industry, but CRM, supply chain management and project lifecycle management software should top your list, Martens says. Analytics, partner relationship management and supplier relationship management software may also beg for tight integration, she adds.

RTC plans to keep improving its invoicing and delivery documentation and processes. “We’re looking to extend this further,” Coffman says. “Some clients want not only a bill of lading but also proof of delivery.” In other words, these customers want a bill of lading that says what day the package hit the customer’s door, not just what day it left RTC’s door, he says.

The company will also continue to simplify internal documentation. “We have a huge temporary workforce here,” he notes, doing jobs like packaging products. “We have a challenge presenting documents that are easy to read. We are taking shop-floor documents and making them easier for people.”