BizAps by Caxton House Marketing

<Marker Placeholder> Automating Procure to Pay

Automating P2P Processes, maximising rebates and Leveraging Your SAP Investment 30th July 2009

Alex McCracken- BizAps Conor Mullaney – BizAps Lol Nugent – Manchester City Council

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Housekeeping Items

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For more information, please contact Alex McCracken at alex.mccracken@bizaps.net

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Today’s Agenda About BizAps The Purchasing Card market today The BizAps SAP certified P-Card Solutions Learn how Manchester City Council are revolutionising their P2P processes by leveraging P-Cards for £50million of spend through the SAP integrated solution Q&A

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About BizAps

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BizAps Today... • Operating group of WNS (a leading BPO services organization) • Global Organization with offices in US (New York and Houston), UK (London), and India. • Serving over 105 customers worldwide • Over 31 customers worldwide running our completely integrated SAP Certified solutions for Purchasing Cards • SAP Services and Software Partner • Specialists in SAP Finance and Procurement and Leading developer of Packaged Services • January 2009, acquired XiBuy business unit to become sole provider of SAPintegrated p-card solutions

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Source to Pay Optimizations Master Data Mgmt Purchase

Purchase Orders Purchase

Order

Purchase Order

Goods Receipt Goods/ Service Receipt Confirm.

Invoice Processing Purchase (Verification) Order

Exception Handling / Purchase Approval Order

Invoice Payment Purchase

Vendor invoice

10 20 30

Vendor Management Vendor Master Workbench

Vendor Self Service

Supply Management Web Requisitioning E-Procurement Packaged SRM

Vendor Portal

Accounts Payable Invoice Automations E-Invoicing Accruals Management

Purchasing Cards Electronic Payments Duplicate Payment Checking

Business Modules Metrics / KPI Reporting Dynamic Discounting

Spend Analytics Workflow Lite

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Fraud Detection

Interactive Forms

P-Card marketplace today

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Early Adopters

Opportunistic

Nearing Maturity

Either do not have a Purchasing Card Program and evaluating options or exploring options for expansion / improvements

Leveraging a Bank system or getting away from in-house developed solution; but need flexibility to change providers, controls, expand the use and reduce the impact of change to the organization including IT by leveraging a completely integrated SAP Certified Solution.

Rich mature program but want to understand how to make AP a Profit Center.

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Case for Extending P-Cards

Purchasing cards deliver efficiency and cost savings by eliminating steps from the procurement process Traditional Purchasing Payment

Classic P-card Payment

P-card with PO’s Payment

Reconciliation

Invoice Processing Purchase Order

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Purchase Order

Introduction

Case for Change

Solution

Demonstration

Q&A

Why use Issuer’s The technology is bundled withSystem the issuer’s entire product offering

Usually heavily considered when selecting the card issuer (ease of use, etc)

It’s “free”

But most organizations don’t realize that they have a choice NOT to use it

Limitations of Issuer Applications

Development required to build interface On-going maintenance of master data and impacted by SAP Upgrades “Another” application to learn and to support (multiple log ins, different screens) Data in two different systems restricts reporting Typically exported monthly, limiting visibility to expenses

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The BizAps Approach to helping SAP companies Optimise their P2P processes with P-Cards

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Introduction

Case for Change

Solution

Demonstration

Q&A

Paper

Validation Matching Processing

Fax

EDI

Supplier Portal

XML

Purchasing P-Card Cards

Capture, Format & Vendor Validation

Process Invoices

Manage Exceptions

Invoice Monitoring

Web Coding & Approval

Invoice Monitoring / Controls

Payment FI / AP Analytics

Process all incoming invoices

Coding FI Invoices

Metrics

Payment

Automatically post invoices

Reconciling P-Card Transactions

Automatically post invoices

Dynamic Discount

Process exceptions

Approving PO Invoices

Manage Disputes

Fraud Detection

Manage Queries

Spend Analytics

Return to Vendor

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BizAps Purchasing Card Solution

• Optimisations • Increase Spend Visibility • Improve Internal Controls • Optimize Working Capital by extending rebates across company

Business Value

Architecture

• • • •

Complete Solution inside of SAP – Reserved Name Space Part of Accounts Payable Workbench - X Apps Certified Standard SAP UI and Web GUI Robust Workflow, Single Sign-On

Reconciliation

• • • • •

Automatic Line Item Matching for PO based transactions SRM / PO Integration PO, Ghost Cards, Pay by P-Card and Non-PO Processing Multi-Card Provider Support Sales Use Tax and VAT

Integration / Reporting

• • • •

SRM Integration Duplicate Check Detection & Fraud Detection Auditing, Multi-Language Spend Analytics

Cross CrossModule ModuleIntegration Integration

Reporting, Reporting,Analytics, Analytics,KPI KPI

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Workflow Workflow 12

Three (3) methods of P-Card usage with BizAps

Classic or Traditional Cards (Non Po)

PO embedded auto matching

Pay by P-Card

• People use their cards as they do today. • Reconciliation process happens in the BizAps Module within SAP • P-Card embedded in PO • Transaction on the statement will act as invoice for matching • If a perfect match then invoice will be auto processed • Invoice received into AP • AP call supplier to see if they want to be paid by PCard • On agreement, invoice is moved to holding area in SAP and reconciled when statement arrives from PCard provider

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BizAps P-Card Uses

Controls Controls

Traditional

SAP Certified Platform SAP Certified Platform Fraud Detection Fraud Detection Audit / Traceability. Accruals Engine

Purchase Orders Pay by P-card

Audit / Traceability.

Supportability

Process Enablement Line Item Matching Tax Compliance

Process Optimisation

Integrated not interfacing Leverages Standard SAP

BizAps P-Card

Workflow Automation

Value Realization

Internal Controls

Maximize Working Capital

Follows existing Backup processes

Spend Visibility

Reporting

Extend Payment Terms

Spend Analytics

Increase Rebates

Tax Reporting

Eliminate Processing Steps

Fraud

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Interfacing versus Integration

Interfacing with SAP

BizAps P-Card Certified Integration in SAP

Characteristics

Inside / Outside SAP Single Sign On Data Replication Cross Module Support

Architecture

• Requires Interfaces • Movement of data • Not real time

• • • •

Maintenance and Support

• Additional effort to support • Non standard look • Data Replications

• Upgrades / support • Look and Feel • GL and Table Changes

• Leverage Existing Process • User friendly Web UI / SAP GUI • Reside inside of SAP

• Multiple challenges impacting ROI, Auditing and Reporting

• Reporting / Auditing • Process Improvements • Tax Regulation Support

• • • •

Value / ROI

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• Part of SAP, data stays in SAP • Support of Single Sign On • Support for HR and SRM

Optimizations Increase Spend Visibility Improve Internal Controls Optimize Working Capital

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P-Card Payment Options with Purchase Order

Payment at the time of Purchase

• P-Card number with cart/PO is created. • Encryption of Card Detail. • Ability to communicate billing instructions to Vendor.

Payment after receipt of Invoice

• BizAps Pay by P-Card (PbP) process. • Communicate billing instructions to vendor after clearing of Invoice • Reconciliation with ref to the invoice number on the card statement

Payment after Goods Receipt (ERS)

• P-Card number issued after Goods Receipt. • Use SAP Self Billing to create the invoice automatically, • Ability to communicate billing instructions to Vendor.

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Line Item Matching Line Item Matching Objective

Rules Based Engine

To automatically reconcile any individual line items with the correct corresponding Purchase order Line Item and post this document without human intervention. Automatic rules are applied when a Purchase Order number is available for either single or multi-line SAP Documents. This is a configurable engine.

Matching rules are applied based on the following items:

Matching Scenarios

Single item, PO Number SAP Material number Vendor Material Number Manufacturer Part Number Price and Quantity Unit price Delivery Note

One to One - A single invoice line and a single purchase order item Many to One - Many invoice lines but only a single purchase order item One to Many - A single invoice line and many purchase order items Many to Many - Multiple invoice lines and multiple purchase order items

Date Range CONFIDENTIAL and PROPRIETARY © Business Applications Associates, Inc 2009 • WWW.BIZAPS.NET

Purchase Order Origination

SAP SRM

MM R/3

eProcurement Applications

XiBuy enhances SAP to enable p-cards as a payment type for POs – and can deliver value in the reconciliation and accounting process for any purchase order stored in MM CONFIDENTIAL and PROPRIETARY © Business Applications Associates, Inc 2009 • WWW.BIZAPS.NET

Introduction

Case for Change

Solution

Demonstration

Q&A

Web Access to Transaction Data Navigation: Select the ‘x to code (PCI)’ tab to display the P-Card transactions that require coding

Actions Available: Submit: Submit all or selected lines for approval Dispute: Dispute all or selected lines Save: Save work in progress coding Comment: Add a comment to the transaction Split: Split a transaction into multiple lines to apply different coding

Amend: •Cost Type (e.g. Cost Center, Purchase Order, Project, Internal Order etc.) • G/L account number • Cost Objects (e.g. Cost Center, WBS, Purchase Order, Internal Order) • Amend the transaction amounts • Amend tax codes and tax amounts.

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Purchase Card Approval – Overview Notification: Email notification similar to the coding email will be received by the Approver Navigation: Select the ‘x to approve’ tab to display the P-Card transactions that require approval

Actions Available: Approve: Approve all or selected lines Decline: Declining all or selected lines Save: Save work in progress coding Comment: Add a comment to the transaction Split: Split a transaction into multiple lines to apply different coding Offline PDA Approval - Included

Amend: •Cost Type (e.g. Cost Center, Purchase Order, Project, Internal Order etc.) • Change G/L account number • Cost Objects (e.g. Cost Center, WBS, Purchase Order, Internal Order) • Transaction amounts • Tax codes and tax amounts.

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Introduction

Case for Change

Solution

Demonstration

Q&A

Source Sourcefrom from PCARD,SAP PCARD,SAP or orUNSPSC UNSPSC

LEARN LEARN Score Scoretop top33 candidates candidates

TEACH TEACH

Add AddPCARD PCARD data datato toAP AP

ANALYSE ANALYSE

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The Manchester City Council P-Card Revolution

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Questions and Answer session with Lol Nugent

Please describe the Manchester City Council (MCC) P-Card program? When did it start, spend going through the program, Number of cards, Number of lodged cards?

Why did you choose an SAP integrated solution versus a 3rd party non integrated/interfaced option?

Please explain how you handle Non PO or traditional transactions in SAP?

Please explain in more detail how MCC are integrating P-Cards within the PO process?

– What have been the benefits? – What processes have you been able to eliminate by using a SAP based P-Card solution – Was it difficult to get the suppliers/merchants to agree? – What types of merchants did you target? – Could you have managed the embedded PO process effectively without a tool that did line item matching in SAP?

What advice would you give to other organisations looking to expand their P-Card program?

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Questions and Answers

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Contact Name

Role

Phone

Conor Mullaney

Director

07887653632

Conor.mullaney@bizaps.net

Alex McCracken

Manager

Xxxx

Alex.mccracken@bizaps.net

Visit BizAps at an upcoming Event: xxxxxxxx

Upcoming Webinars: xxxxxxxxxxxxxxxxxxx

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www.bizaps.net

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Introduction

Case for Change

Solution

PCARD Class Helper Tool - Learn

Demonstration

Q&A

Source Sourcefrom from PCARD,SAP PCARD,SAP or orUNSPSC UNSPSC

LEARN LEARN Score Scoretop top33 candidates candidates

TEACH TEACH

Add AddPCARD PCARD data datato toAP AP

ANALYSE ANALYSE Solution: Solution: learn learn tokens tokens from from known known associations associations CONFIDENTIAL and PROPRIETARY © Business Applications Associates, Inc 2009 • WWW.BIZAPS.NET

Introduction

Case for Change

Solution

Demonstration

Q&A

Source Sourcefrom from PCARD,SAP PCARD,SAP or orUNSPSC UNSPSC

LEARN LEARN Score Scoretop top33 candidates candidates

TEACH TEACH

Add AddPCARD PCARD data datato toAP AP

Solution: Solution: apply apply token-master token-master data data associations associations to to unassigned unassigned data data with with score score based based on on number number of of 29 hits hits CONFIDENTIAL and PROPRIETARY © Business Applications Associates, Inc 2009 • WWW.BIZAPS.NET

ANALYSE ANALYSE

Introduction Case for Change Configuration Notes Solution

Demonstration

Q&A

Flexible Flexibleconfiguration configurationof ofattributes attributes and weighted scores plus and weighted scores plusmultiple multiple versions versions

Workflow Workflowsetup setupagainst againstgeneric generic accounts or for specifics accounts or for specificsfor for individual attribute definitions individual attribute definitions

Language Languagesensitive sensitiveknowledge knowledge database of bad/useless database of bad/uselesstokens tokens and separator strings and separator strings

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Introduction

Case for Change

Solution

Demonstration

Q&A

BizAps Fraud Management Reports Purpose

• Provide different ways of identifying potentially fraudulent PCard (a potentially invoice) transactions • Provide a scoring mechanism to rank different types of transactions

Why is this important

• Difficult to identify and manage fraudulent or duplicated transactions • Expensive and time consuming to send these transactions to a 3rd party • Increase use leads to increased need for detection

Features

Current Release • “Mass Transaction” analysis - comparison to Benford’s Law 2009 Release • Early warning Detection • Reconciliation based Detection Future Release • Integration with Time and Expense Reporting • Advanced Analytics

Introduction

Case for Change

Solution

Demonstration

Q&A

Early Detection Goal

• Provide quick scoring upon receipt of Card File from bank.

Features • Initial analysis is performed prior to manual reconciliation process and includes auto-reconciled transactions • Score based on Card number with quick comparison against historical use • Alerts with Approval / Audit workflows • Reporting inside of SAP • Flagging of cards inside of BizAps configuration tables

Introduction

Case for Change

Solution

Demonstration

Q&A

Advanced Analytics Goal

• Post reconciliation analysis with non traditional card data

Features • Leverages Reconciliation Based features and is enhance with data from across the organization including Expense information, data that normally stands alone but when added can draw value. • Integration with Spend Analytics • Leverage of non card data to perform analysis • Buyer behaviour with algorithmic trending analysis – (buying a snow blower in Florida or in June)

Introduction

Case for Change

Solution

Demonstration

Q&A

Reconciliation Based Detection Goal

• Leverage reconciliation data to perform additional analysis.

Features • Score based on Card number with quick comparison against historical use • Alerts with Approval / Audit workflows • Reporting inside of SAP and in SAP BI or Client BI tool • Traceability during reconciliation to provide update alerts on suspect items • Processing analysis against history up to approval • Flagging of cards inside of BizAps configuration tables • Leverage of non card data to perform analysis

Introduction

Case for Change

Solution

Demonstration

Q&A

Key Fraud Process

“Mass Transaction” analysis - comparison to Benford’s Law “Individual Transaction” analysis by value - comparison to historical use Variance analysis based on: o Year on Year o Date and Time o Amount o Size of amounts o Purchase Location o Characteristics of the purchase o Buyer (User) behaviour analysis o UNSPSC or SAP material groups o Cost Center o Type of Use Historical Trending Comparison Card flagging both manual and automatic Cross business analysis – the ability to leverage non card data for purpose of analysis (i.e. Mileage, distance traveled, project, business information)

Introduction

Case for Change

Solution

Demonstration

Q&A

EXCEPTIONAL INDIVIDUAL TRANSACTIONS … BY VALUE Identify suspiciously large or small values with the normal distribution of spend against Amount . The higher the value of k the lower the probability of finding an amount differing from the mean M by more than k * standard deviation and therefore the more suspicious that amount. This produces fewer false positives. The normal distribution data as a percentage is bracketed as follows

1σ

1.645σ

1.960σ

2σ

2.576σ

3σ

%age

0.6827

0.9

0.95

0.9545

0.99

0.9973

3σ

3.2906σ

4σ

5σ

0.9973

0.999

0.99993666

0.999999427

6σ

7σ

0.999999998

0.99999999999744

Introduction

Case for Change

Solution

Demonstration

Q&A

These reports show potential fraudulent transactions based on statistical and pre-defined rules

Introduction

Case for Change

Solution

Demonstration

Q&A