L'Oreál's Consumer Product Division optimizes its invoice processing
The ReadSoft effect on: L'Oreal
Process: Accounts payable automation for SAP
Segment: Cosmetics
Country: France
ReadSoft’s invoice processing solution automates the handling of 80,000 incoming invoices per year for four entities of L’Oréal’s Consumer Products Division. L’Oréal’s main objectives when choosing to automate their processes was fast and secure circulation of documents; more efficient interaction between the company and its suppliers; and reduced cost for invoice processing.
An anticipating approach
L’Oréal started preparing for the invoice automation project almost a year in advance: The Accounts Payable teams of the four entities were merged into one, and SAP SRM (Supplier Relationship Management) was deployed to optimize the procurement process. All invoices are now linked to an order process. By adopting this approach, L’Oréal facilitated the matching of purchase orders and invoices, which is important for optimizing the entire process.
Optimizing the overall process
In order to attain optimal allocation of resources, L’Oréal has outsourced the mailroom and invoice scanning services. The outsourcing part of the business process to a specialized third party gives the company the ability to free the AP teams of certain administrative tasks. The remaining process – the data management into SAP – is maintained in-house and handled by the ReadSoft solution.
Invoices registered into SAP in one day
All incoming invoices are handled by the service partner: opening, sorting, scanning, verification, paper archiving. The information is converted into XML and PDF format and sent to another third party specialist for conversion into SAP IDoc format, checking against supplier tables, uploading of PDF images to the archiving repository and IDoc data to the ReadSoft platform. ReadSoft’s solution verifies the information, matches invoices with purchase orders, automates allocation, and streamlines the approval routine as well as dispute resolution. Thanks to this optimized process, all incoming invoices are registered into SAP in one day.
Increased efficiency
ReadSoft’s products EDI COCKPIT and INVOICE COCKPIT are used on a daily basis by L’Oréal’s accountants. Thanks to the high level of integration into SAP and the familiar-looking user interface, it takes less than a day to get used to the new software. Among the other advantages mentioned by the Accounts Payable staff was how easy they now can match invoices with purchase orders. Each equipped with a 19 inch wide screen, they can easily view both documents (the image of the invoice and the purchase order) before integration into SAP. Moreover, the electronic image of the invoice can easily be retrieved from the archive, which facilitates any further consultation and eliminates paper handling.
Towards full e-invoicing
ReadSoft’s ANALYZER, providing statistical evaluations, increased productivity from day one. A month and a half after the solution was implemented (February 2008), the daily capacity of treatment was doubled. At that rate, the first returns of investments are expected before the end of the year.
The success of this project has awakened L’Oréal’s interest to extend the scope to other types of invoices. ReadSoft’s recognized ability to handle EDI files also allows L'Oréal to prepare, slowly but surely, for the next step: a full e-invoicing solution.
About L’Oréal
The solution
- Consulting Partner: VISEO
- SAP R3
- SAP SRM (Supplier Relationship Management)
- INVOICE COCKPIT (control center for all incoming invoices)
- EDI COCKPIT (processing of invoices received in IDoc format)
- ANALYZER (reports generation)
- IXOS (archiving)
- Volume: 80 000 invoices/year.
Benefits
- Optimal allocation of resources
- A single point of entry for all types of invoices (e-mail, paper, PDF, XML, EDI…)
- Secure documents workflow
- Significant improvements in resolving discrepancies with suppliers
- Archiving and un-archiving tasks are minimized
- Cost per invoice processed reduced
- Faster processing
- An expected ROI under one year.