The personnel cutbacks in accounting within the FAZ business group in recent years have been severe. Erich Trageser, head of accounts payable, now has to get by with six employees instead of 10; in a secondary accounting department, his colleague Horst Heisiph makes do with three people where once were six.
The number of incoming invoices, meanwhile, has not abated. “Quite the opposite,” says Trageser. “Since the economy started to rebound, we’ve been issuing more orders and receiving more bills from our vendors.”
Some 1,600 vendors send their invoices to the German publishing house every month: 2,300 to FAZ GmbH and its five subsidiaries, 2,000 to Frankfurter Sozietätsdruckerei (FSD), and 1,000 to Märkische Verlags- und Druckereigesellschaft (MVD). Until the end of 2009, this meant around 60,000 payment requests for FAZ to process by hand every year.
To begin handling incoming invoices electronically, Frankfurter Allgemeine Zeitung then implemented FIS/edc from FIS GmbH on a central SAP system. The company opted for this solution in mid-2009 based on its support for clients, three of which have since been set up in parallel: one for FAZ GmbH and two for its associate organizations, the aforementioned MVD and FSD.
From a legal standpoint, FAZ, MVD, and FSD constitute three independent companies and are thus mapped as autonomous clients in a common SAP system. “In essence, we’ve carried out three individual projects in invoice processing,” says Christian Hüsing, the project manager from FIS GmbH.
Next page: Digital invoice processing
The way forward is digital
The majority of FAZ’s order invoices run through SAP’s Financial Accounting (FI) application. Hardly any come from Materials Management (MM), which sees more intensive use from the associate companies FSD and MVD. FAZ itself used to lose two days just in sending invoices back and forth between its accounting and user departments.
Back then, account clarification was impossible, and when one of FAZ’s 200 approvers was late in signing off on a request, an overview of currently open payment claims was simply not available. The obvious next step was to find a fully digital means of handling and automating invoice processing.
“Before choosing one, we took a look at four software solutions that differ only slightly in the functionality they offer,” recalls Klaus-Erich Rieseberg, IT project lead at FAZ. “In the case of FIS GmbH, the total package impressed us most: meaningful references, good documentation and product presentation, diverse SAP competency, and above all, excellent value for the money.”
Working with parked documents
In designing FIS/edc, FIS GmbH took a unique technical approach: The workflow solution works with parked documents, a standard SAP document type. “FIS/edc fills real SAP tables and interfaces with real SAP functions. This enables us to work with advance postings in FI and modify them right up until the last minute,” Trageser says. “Plus, each invoice document is entered as a posting, which means we can see it on the accounts; it also flows into all of our standard SAP reports, but not yet into our financial accounting, which keeps it from affecting our sales figures.”
FAZ’s accounts payable department adjudged this approach to be the most appropriate for its needs. “With the approval workflow in FIS/edc, the majority of approvers use the FIS Web solution, which makes approving invoices much faster and easier,” explains Rieseberg.
Next page: Costs in the five figures
Costs in the five figures
Upon choosing FIS/edc in late fall 2009, FAZ decided to await the release of SAP ERP 6.0 before having FIS GmbH implement the solution. This process then began in January 2010, and FAZ GmbH went live with the solution at the end of the following April. MVD followed in early May, and FSD in late June.
The overall project stayed within the foreseen five-figure budget, with services making up two-thirds and software accounting for the remaining third. Although the go-live was a cold start, things worked right from the beginning. “We went to 100% of our invoice volume as soon as we went live and were able to switch from paper to electronic processing from one day to the next,” says Rieseberg.
Horst Heisiph, meanwhile, describes FAZ’s newfound ability to scan in invoices directly upon receiving them and conduct the entire subsequent approval process in a fully electronic fashion as “simply elegant.” The company now collects its invoices at a central mail administration center, where they are immediately scanned. FAZ employees receive the paper documents digitalized at the mail center in scanned format, and can then use the monitor in FIS/edc to correct any data not fully identified by the invoice reader software FCI.
After that, the invoices flow into the FIS incoming invoice monitor in SAP as parked documents, at which point the FIS/edc approval workflow is automatically or manually triggered.
From days to just minutes
FAZ has authorized 150 approvers at level one, and another 60 at level two. “The workflow lets us fine-tune the hierarchy based on amounts on invoices and separately for every department,” Rieseberg reports.
In their work, approvers receive an e-mail with two links: one to the invoice requiring approval, and one to their account on the FAZ intranet, where they can access a complete overview of their current invoices.
It used to take invoices up to seven days to make their way through the company before landing in accounting for posting. With the FIS solution, FAZ employees can now approve them in a matter of minutes.
Meanwhile, the use of FIS/edc has led in particular to increased transparency throughout FAZ’s accounting. “The solution helps us post more invoices by month’s end and gives us much better cost oversight,” explains Erich Trageser. “One look is enough to figure out where an invoice is stuck and what month it belongs to.”
Ultimately, FAZ benefits from the significant liquidity advantages that result from its ability to draw input tax earlier.