Automation and Optimization of Financial Processes Finance

Automation and Optimization of Financial Processes

Finance Professional’s Challenge § Reduce costs — Increase throughput without additional resources — Decrease cost per transaction § Strengthen controls to minimize risk — Comply with regulations (Sarbanes-Oxley) — Enforce consistent processes across the organization § Improve service to business units and suppliers — Increase speed, accuracy and visibility — Reduce burden on the line-of-business managers Do this all at the same time and make it pay for itself Copyright © 2006, 170 Systems, Inc. All rights reserved. 2

Barriers to Resolution § Over 80% of all transactions are still paper-based — “The paperless office is one of the worst predictions in the history of technology” – Forbes, May 2001 § ERP Systems are not designed to solve the problem — The “system of record”, but constructed for data not processes — Fails to enforce/implement “best practices” and compliance — Cannot address unstructured information that initiates most transactions § Traditional document management solutions aren’t architected for transaction processing — Multiple representations of the data and transactions — Designed for archival and retrieval — Customer-specific solutions delivered via custom code Copyright © 2006, 170 Systems, Inc. All rights reserved. 3

World Class Finance Performance § World Class Transaction Processing Companies have achieved better cost results by — Streamlining and automating routine processes — Leveraging the functionality of technology to § Implement best practices to drive increased accuracy, integrity, and risk mitigation § Eliminate the paper § Automate workflow of electronic or imaged invoices § Utilize the Internet for increasing speed and availability — Mandating integration of their ERP applications in a unified platform — Build in integrity monitoring software ensures compliance and protection from fraud Copyright © 2006, 170 Systems, Inc. All rights reserved. 4

170 Mark. View Solution People Process Technology Copyright © 2006, 170 Systems, Inc. All rights reserved. 5

170 Mark. View Solution § Fixed Price Implementations § Depth of Experience § Global 2000 Customers § Domain Expertise § Best Practices § Business Processes § Shared services Imaging & Markup Workflow Copyright © 2006, 170 Systems, Inc. All rights reserved. ERP Integration 6

170 Systems Customers are the World’s Leading Companies Aerospace/ Defense § General Dynamics § Sandia National Labs Communications § AT&T § Bell. South § British Telecomm § Equant § O 2 § Verizon § Vodafone Consumer Goods § Electronic Arts § Mattel § Sony Education § Harvard § Ryerson University § San Diego State § Stanford § U. Pennsylvania Energy Financial Services § Ameriquest § Cigna § Citigroup § D&B § E-Trade § JP Morgan Chase § Marsh § Master. Card § TD Bank § Atmos Energy § Kerr-Mc. Gee § Plains All American Food/Beverage § Smith International § Williams § Schreiber Foods § J. M. Smucker Engineering/ Construction § Carillion Healthcare § Granite § Macerich § Pacifi. Care § Michael Baker Corp. § Select Medical § M. A. Mortenson § University Hospitals § Network Rail § Suffolk Copyright © 2006, 170 Systems, Inc. All rights reserved. Manufacturing/ Supply § Arrow Electronics § GE § Toyota Public Sector/ Government § NIH § NYC Housing § Scottish Legal Aid Board § TSA § US DOT § US FAA § US CDC § US Coast Guard Retail Technology/ Information § Biogen Idec § Canon § Juniper Networks § NCR § Red Hat § Reuters § Sapient § SAS § Seagate § Yahoo Travel/ Entertainment § Cendant § Gaylord § Maritz § TUI § Nordstrom § Sportsmen’s Warehouse § Starbucks 7

170 Mark. View Applications § 170 Mark. View Financial Suite — Accounts Payable — Expense Management — Procurement — Accounts Receivable — General Ledger — Asset Management — Project Re-Billing — Human Resources Copyright © 2006, 170 Systems, Inc. All rights reserved. 8

The 170 Systems Solution for Accounts Payable

Invoice lifecycle Capture Entry Review/ Resolve Copyright © 2006, 170 Systems, Inc. All rights reserved. Coding Approvals Payment Audit 10

Invoice Receipt, Capture and Entry Capture Entry Review/ Resolve Coding Approvals Payment ERP Environment Scan/Fax Manual Entry OCR 001100 XML 1 111 Supplier Network Mark. View Self Service Invoice Automated Entry Image Automatically Attached Copyright © 2006, 170 Systems, Inc. All rights reserved. 11

Optimize your ERP Entry Leveraging your investment in ERP, Data and Resources with no Duplication Copyright © 2006, 170 Systems, Inc. All rights reserved. Review/ Resolve Coding Approvals Payment ERP Environment Corporate Data § Organizations § Sets of Books § Hierarchies § Vendor Supplier Lists § Chart of Account Information § Business Rules § Materiality Limits § Etc. 12

Extensive Workflow Options Capture Entry Manual Entry OCR 001100 Supplier Network Mark. View Self Service Invoice Coding Approvals Payment ERP Environment Scan/Fax XML 1 111 Review/ Resolve Automated Entry Image Automatically Attached Copyright © 2006, 170 Systems, Inc. All rights reserved. 170 Systems Context Sensitive Workflows § § § PO Based Non-PO Based Pre-Approved Self Service Supplier Maintenance 13

Metrics, Analytics and Reporting Capture Review/ Resolve Entry Manual Entry OCR 001100 Supplier Network Mark. View Self Service Invoice Approvals Payment ERP Environment Scan/Fax XML 1 111 Coding 170 Systems Context Sensitive Workflows Automated Entry Image Automatically Attached § § § PO Based Non-PO Based Pre-Approved Self Service Supplier Maintenance User Interface Copyright © 2006, 170 Systems, Inc. All rights reserved. 14

Case Study — Juniper Networks § § § 2005 Annual Net Revenue @ $2 B Global workforce of 4, 600 employees Finance located in four key theaters — Sunnyvale, Dublin, Hong Kong, Bangalore § Time-consuming and expensive process 1. Receive paper invoice 2. Look up authorizer on purchase order 3. Email invoice details to authorizer to approve invoice via email 4. File invoice waiting for approval in file drawer 5. Wait for approval via email 6. Follow up for approval if no response § § 7. 8. 9. 10. 11. 12. Receive approval Pull invoice from file drawer Key invoice in ERP system File invoice in AP file storage Execute payment Pull invoice from file when inquiries received Too Slow — Cycle time on average 8 to 9 days Could Not Scale Globally Copyright © 2006, 170 Systems, Inc. All rights reserved. 15

Global Juniper Accounts Payable Metrics WW Historical 2003 (Pre SSC) WW Current 2006 5 12 # of Invoices Processed 62, 000 416, 817 % of Manual Invoice/PO 45% 75% Monthly Trans per FTE 1000 3000 8 to 9 days 2 to 3 days 9. 2 min 3. 4 min $4. 72 $1. 78 48% 89% # of AP Employees Length of Backlog Minutes/Invoice Cost/Invoice % of Process Automated Copyright © 2006, 170 Systems, Inc. All rights reserved. 16

Benefits of Automation… and 170 Systems’ Solution § Reduced Costs — Optimize cash management: Capture all discounts, eliminate penalties, introduce dynamic discounts — Improve productivity for Finance, Line of Business managers, employees — Reduce operating costs: eliminate costs of copying, filing and transporting all related documents § Strengthened Internal Controls — Increase control and visibility — Automate segregation of duties — Smoother audits due to on-line access to audit trails and backup § Improved Service Levels and Visibility — — Self service for Line of Business managers, employees, suppliers, customers Reduce cycle times to less than 5 days Reduce process errors Performance metrics and monitoring Gantry Group Study: 7. 4 month payback and 300% ROI Copyright © 2006, 170 Systems, Inc. All rights reserved. 17

Mark. View for Oracle Accounts Payable Demonstration

Maritz Inc. The world’s largest source of integrated performance improvement, travel, and market research services Problem: Cost control § 250, 000 invoices per year with expected growth of 100, 000 § Redeployed Staff — 7. 5 FTE’s ($360, 000/year) § Reduced total processing time by 20, 000 person-hours § Increased AP productivity from 50 invoices/person/day to over 200 § Realized over $1. 5 M annually in additional early payment discounts due to reduced processing time Source: OAUG Whitepaper 2004 Copyright © 2006, 170 Systems, Inc. All rights reserved. 19

Select Medical The leading operator of long-term acute care hospitals in the US – 98 hospitals and 740 outpatient clinics Problem: Managing rapid growth through acquisition § 30, 000 invoices / 3, 500 expense reports per month § Document transport cost savings: $225 K/year § Redeploy staff: 3 people ($150 K/year) § Filing and onsite storage eliminated: $25 K/year § Late fees, early payment discounts: est. $100 K/year § Other tangible benefits — Web-based invoice query tool – reduced AP staff time — Ability to conduct audits and inquiries § 170 Mark. View: AP, Expenses, Assets, General Ledger Source: OAUG Whitepaper 2003 Copyright © 2006, 170 Systems, Inc. All rights reserved. 20

170 Systems – Leading Provider of Solutions that Automate and Optimize Financial Processes § Depth of Experience and Domain Expertise — 16 years+ of Experience — Global 2000 customers in 40 countries — Extensive best practices § Advanced ERP Integration — Certified with § Oracle e-Business Suite § People. Soft Enterprise Applications § my. SAP ERP Business Suite § Focus — Process automation product, not a platform — Configurable solution — Proven ROI Copyright © 2006, 170 Systems, Inc. All rights reserved. 21

170 Systems Select Customers Copyright © 2006, 170 Systems, Inc. All rights reserved. 22

170 Systems Leading Provider of Solutions that Automate and Optimize Financial Processes § Business Process Automation Focus § Advanced ERP Integration § Depth of Experience and Domain Expertise § Complete Product Copyright © 2006, 170 Systems, Inc. All rights reserved. 23

170 Systems – Leading Provider of Solutions that Automate and Optimize Financial Processes § Business Process Automation Focus — Beyond document capture to focus on the entire process — Intelligent Mark-Ups that initiate workflow — 170 Mark. View Express: better decisions faster for line-of-business managers — 170 Mark. View Insight: Visibility into productivity, cash flow, and potential fraud for finance managers Copyright © 2006, 170 Systems, Inc. All rights reserved. 24

170 Systems – Leading Provider of Solutions that Automate and Optimize Financial Processes § Business Process Automation Focus § Advanced ERP Integration — Certified with § Oracle e-Business Suite § People. Soft Enterprise Applications § my. SAP ERP Business Suite — No duplication of ERP data — Integrated workflow and processes — User input validated against ERP in real time (GL account codes) — Leverage ERP user hierarchy and single sign-on Copyright © 2006, 170 Systems, Inc. All rights reserved. 25

170 Systems and Oracle § Advanced integration with Oracle — Integrated user interface — No duplication of data — Leverage ERP's user hierarchy and security § Highest level Oracle partner (since 1990) — Oracle Certified Advantage Partner Program — Oracle Cooperative Applications Initiative (CAI) — Oracle Open Tools Initiative (OTI) "As a Certified Advantage Partner, 170 Systems continues to bring great value to our mutual customers through 170 Systems’ integrated product offerings. ” - Doug Kennedy Vice President, Worldwide Alliances, Oracle Copyright © 2006, 170 Systems, Inc. All rights reserved. 26

170 Systems – Leading Provider of Solutions that Automate and Optimize Financial Processes § Business Process Automation Focus § Advanced ERP Integration § Depth of Experience and Domain Expertise — Demanding Global 2000 customers — Global experience: shared service centers, off-shoring, outsourcing — Top-tier ERP experience: SAP, Oracle, and People. Soft — Proven ROI: 7. 4 months average payback — Best practices in Finance — Strengthening controls Copyright © 2006, 170 Systems, Inc. All rights reserved. 27

170 Systems – Leading Provider of Solutions that Automate and Optimize Financial Processes § Business Process Automation Focus § Advanced ERP Integration § Depth of Experience and Domain Expertise § Complete Product — A true software product: certified, documented, upgradeable — More than AP – a full Financial Suite — End to end automation: imaging, OCR, e-invoice, workflows, exception processing, supplier portal, analytics — “Fixed price” implementation — Complete portal Copyright © 2006, 170 Systems, Inc. All rights reserved. 28

The Non-PO Invoice Process “Get Next” Read / Write access to Auto Document Chart of Accounts Association Paper & Scan Fax Use of ERP Hierarchy Header Information Hold released in ERP Final AP Review Code Electronically Forwarded and Recorded Copyright © 2006, 170 Systems, Inc. All rights reserved. 29

The Self Service Invoice Process ERP Hierarchy Read / update Auto Document access to Association Chart of Accounts Header & Coding Information (by field) Fax Back-up Hold released in ERP Final AP Review (if desired) Record created in ERP Liability captured Copyright © 2006, 170 Systems, Inc. All rights reserved. 30

Potential Payment Request: Expense Processing Future State Enter Expense Report Detail Print Bar-Coded Cover Sheet Copyright © 2006, 170 Systems, Inc. All rights reserved. Fax Receipts Automatic Association with Report Routing Payables and Audit 31