Case Study

More than 200% increase in productivity: No one can knock the wind out of our sails!

“Labor is becoming increasingly expensive in Germany. Hourly wages rose once again in spring 2006. Most notable is the growth of gross wages in the manufacturing industry and service sector.” – German Federal Office of Statistics, September 2006. Companies face great challenges. But is it really possible for tailor-made industry solutions to stimulate productivity and thus generate jobs in Germany for the long term? T-Systems has found the answer.

The User

T-Systems, the global provider of information and communications technology (ICT), founded the group-owned Shared Service Center Finance & Accounting in Weingarten (Germany) in 2000, as part of its Shared Service Center Strategy. Today, T-Systems’ entire financial accounting for its German locations is managed by 200 employees on three locations, which are organized by function (asset accounting, travel expense accounting, e-documents, accounts payable, accounts receivable and payment transactions). The accounts payable department with 95 employees makes up the SSC Finance & Accounting’s core business. As of now, 50 percent of the documents are processed electronically.

In order to fully optimize invoice processing, SSC Finance & Accounting opted to implement Invoice CENTER – the automated invoice processing solution from Open Text Document Technologies. The success of this decision speaks for itself. The accounts payable department has witnessed an increase in productivity of more than 200 percent. This is largely thanks to Invoice CENTER.

The Solution

At T-Systems’ Weingarten site, Invoice CENTER automatically processes around 1 million invoices a year for the various T-Systems companies. The central point of invoice receipt is SSC Finance & Accounting. Here, the documents are prepared, scanned and digitally processed. Invoice CENTER electronically pre-sorts the individual invoices, which can then be assigned automatically to one of the four connected SAP systems. Invoice CENTER identifies the target systems using the purchase order number and the recipient data of each invoice. This factor has made a significant contribution towards increasing the productivity of the entire process. The time-consuming, manual pre-sorting of invoices is eliminated, and valuable staff skills can be deployed in handling more complex cases.

All invoices received on a given day are processed and posted within 24 hours of receipt. One of the SSC Finance & Accounting team’s most ambitious goals has therefore been reached. The team can meet its tight schedules without exception even during peak times. The reason for this lies in Invoice CENTER’s document analysis software and the standard International Invoice Knowledge-base, which have invoice recognition rates of over 85 percent. In total, Invoice CENTER analyzes and classifies some 10,000 invoice pages a day and extracts the relevant data from these. This data are then compared with the master data delivered from the connected SAP systems. Should all the data necessary for successful identification of the target system not be contained within an invoice, the invoice is validated and manually completed. If the data are indeed complete, they are transferred to the SAP systems and stored in T-Systems’ ImageMaster® archive. The SAP Business Workflow controls the further processing of the invoice. The release process is carried out in the respective SAP system.

Globalization

The more versatile the tasks and the more global the businesses are, the more complex and international the IT systems will need to be. Tasks are carried out in those locations where structures are already in place. Geographic distance is of no consequence here. The system for T-Systems’ foreign subsidiaries is based in, and administered from, South Africa. The OCR server and ImageMaster are in Weingarten, Germany. Validation and posting take place in different locations, including the nearshore region of Bratislava, Slovakia. In all these places, Invoice CENTER’s built-in strengths of multi-client capability, distributability and scalability – which were designed with global business in mind – are highly valued. Invoice processing is performed around the globe thanks to shared services and out-tasking, company growth is strong and jobs secure, and the right skills are in the right locations. The entire monitoring of processes remains however in one hand.

Reorientation

“According to a study on Business Process Outsourcing (BPO) ... in cooperation with T-Systems, which surveyed top managers from 10,000 firms in Europe, almost half of the CEOs had thought seriously about outsourcing their entire business processes. One of the economic sectors most interested in BPO is the financial services sector. Evidently this sector is being moved by competitive pressure to lower costs while simultaneously maintaining – or even improving – customer service standards.” T-Systems’ SSC Finance & Accounting offers external customers combined IT and department expertise with the goal of increasing company efficiency. The success of the strategy speaks for itself. The Weingarten location is viable for the long term, and the number of staff remains constant. Today, employees are able to process significantly higher numbers of invoices. Up-to-date (even during the usual end-of-year and end-of-quarter peak load times!), optimal service and constant readiness to provide information to business partners is a trump card when it comes to international roll-outs, and these will follow soon. “It is a thrilling aspect of our work to see how the implementation of new technology brings productivity gains. I look forward to offering these advantages to other customers,” remarks Hannelore Grabherr, Head of Current Accounts at SSC Finance & Accounting in Weingarten, Germany.

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