How high data quality fuels electronic invoice processing

It's no wonder that outsourcing is still in demand in Germany: According to an Axxcon study, almost half of the participating decision-makers (47 percent) noted an improvement in quality with outsourced IT functions. REINZ-Dichtungs-GmbH, a specialist in sealing technology, has also been relying on outsourcing for the recording and validation of incoming invoices since 2018. Since then, the company has received all invoices digitally and verified in its own SAP inbox for further approval or posting, within a maximum of 48 hours.

Smart workflows for more automation

The subsidiary of DANA Incorporated started back in 2012 with the digitization and automation of incoming invoices in SAP - completely in-house. Patrick Kreuzer, Head of Finance at REINZ, remembers: "Whether logistical invoices with order reference for MRO and production materials incl. verification of the valuated goods receipt or the processing of limit and estimated price orders - our incoming invoice management is complex and the processing was correspondingly time-consuming. With the introduction of a solution for automated and digital processing of incoming invoices in SAP since 2012, we have significantly accelerated the process of logistical invoice entry and invoice verification, while at the same time increasing transparency."

Smart assistants have been programmed within the solution to accompany the processing procedure. In the event of discrepancies, for example, a warning message pops up if an invoice is not required because it is a credit memo procedure. Even an indication of whether there is a risk of losing the cash discount appears. The workflow check implemented since 2018 for invoices without a purchase order reference also significantly accelerated the previously manual, time-consuming standard process. Thanks to a release matrix, the solution now automatically determines the next responsible releaser. The tedious process of checking whether the invoice contains all release signatures is no longer necessary. Today, employees can see the status of the invoice release transparently in the system monitor.

"We have also integrated the solution into our goods receipt process," says Kreuzer. "Now, if a delivery has not been confirmed, we can initiate a workflow to send a reminder directly via the AFI solution when the invoice is available. This was a real milestone for us, because the departments that used to have to jump after goods receipts are now massively relieved. Based on the wizard messages, the system checks a lot of things automatically. Now the solution is the invoice checker, which reliably says that this is a credit memo procedure, the goods receipt has been received or not, there are price or quantity differences, or whether a goods receipt may not be necessary. As a result, the overall processing runs faster and more transparently, certainly also a reason why the solution is very well received by users."

Efficiency. Flexibility. Scalability.

When REINZ introduced the SAP solution from AFI Solutions in 2012, the Neu-Ulm site received around 40,000 incoming invoices per year with approximately 120,000 pages - at that time mainly by mail. Since then, a lot has happened: The system was adapted to new circumstances and the solution was rolled out to additional holding companies at the Neu-Ulm site. The invoice volume increased steadily, in the end to such an extent that REINZ considered outsourcing the time-consuming preparation of invoice data. Kreuzer reports: "As far as I know, AFI Solutions is one of the few manufacturers in Germany that offers solutions for workflows in the invoice ledger and combines this with a full service for invoice digitization. We looked at the service and realized that outsourcing would save us a lot of resources and reduce our standard activities. In addition, we reduced IT server costs and were able to save on OCR software."

Service like a glove

Of course, the external service provider also takes REINZ's special features into account, such as the validation of Conto-pro-Diverse suppliers from around 40 countries. Here, master records in the system make no sense. For CPD suppliers, there are collective accounts where data such as address, vendor or bank details must be entered and validated again and again in invoice verification. REINZ no longer has to worry about this effort; the service provider now takes care of it. Marisa Hiller, Head of the RedPaperCenter in Stuttgart: "One of the main arguments in favor of our services in the RedPaperCenter is that employees in accounting or purchasing are no longer burdened with administrative preparatory work, nor do they have to worry about handling these tasks in sick or vacation situations, and can therefore concentrate on their core competencies. In addition, we always work with the latest optical character recognition technology. Our employees check and validate the automatically read document data, which is then transferred in encrypted form via our servers to REINZ, where it is imported into the SAP system. In this way, REINZ employees can comfortably continue working with the data in their AFI monitor using DirectInvoiceControl. The invoices are, of course, securely archived at the customer's site and can be retrieved at any time in the original, including e-mail and invoice attachments from the suppliers."

Due to the good experience with the service for the Neu-Ulm site, DANA is now also considering using AFI for invoice verification at other European sites and consequently outsourcing the validation of invoice documents to Stuttgart. Kreuzer concludes: "Currently, AFI Solutions' RedPaperCenter processes around 200 invoices daily for our German site. Due to the excellent data quality, for which a detailed definition of the requirements is necessary, and the resulting efficiency of the downstream processes, the Group is now considering rolling out not only the invoice solution but also the AFI Solutions service to our European subsidiaries."