Application
WorkFlo/Payables
Customer Profile
Ingram Micro Incorporated is the world's largest distributor of microcomputer products with operations in the US, Canada, Mexico, and Europe. Headquartered in Santa Ana, California, the company sells more than 30,000 products from 850 of the world's leading hardware manufacturers and software developers to more than 70,000 customers worldwide.
Ingram Micro excels in product availability, delivery, competitive pricing, and customer service. Sales in 1995 of $8.5 billion, were up $3 billion from 1994.
Problem
Computer systems at Ingram Micro's distribution centers allow the company to accept and process orders quickly and reliably for next day delivery in most cases. The company relies on fast execution and excellent customer service to stay ahead in its highly competitive business. With these goals in mind, a project began in 1990 to explore document-imaging technology to support its corporate accounts payable operations. The company installed a proprietary document-imaging system. But, after two years of production, it became clear that this system could not sustain the growth in volume associated with the company's rapid expansion. In 1992 Ingram paid out $2 billion per year in invoices with a staff of 30 persons. Today the Accounts Payable department handles $8 billion in invoices each year with a staff of 50 persons.
The search began for a workflow and document-imaging company that could deliver a scalable, open system with a graphical user interface and accommodate Ingram's large volume requirements. Following a thorough evaluation of the several vendor's latest offerings, FileNET's WorkFlo Business SystemWorkFlo/Payables was selected. “FileNET had the industry experience and resources to get the job done in our timeframe,” said Susan Duggin, Senior Director, Accounts Payable, Ingram Micro, Inc.
The FileNET Solution
In 1995 a FileNET WorkFlo/Payables and document-imaging solution became operational in Ingram Micro's corporate accounting department. Today, there are 50 users in the accounts payable department handling about 51,000 invoices each month using FileNET software.
This client/server solution includes FileNET's IMS (Image Management Services) software for organizing, storing, and accessing all types of information, including the invoice images, EDI and other data and text. For hardware, Ingram Micro chose Hewlett-Packard's powerful UNIX servers. Hewlett-Packard is a business partner of Ingram's and has been chosen as a strategic computing platform by Ingram Micro's corporate IS organization. Hewlett-Packard's RISC servers are the ideal platform for FileNET's software because the systems are upgradable and consistent adherence to industry standards permit integration of various applications. Ingram Micro chose the HP 9000 server running IMS software to manage document-images and FileNET's WorkFlo/Payables software tomanage the workflow.
Invoices are received centrally where the paper documents are scanned,
indexed and written to optical disks stored in FileNET Optical Storage
and Retrieval (OSAR) library. About 25 per cent of invoices are received
electronically through Electronic Data Interchange (EDI) software. Use
of EDI for these invoices
eliminates the need for scanning and indexing and the invoice is moved
to the next processing step. Ingram Micro then uses FileNET's COLD (Computer
Output to Laser Disk) product to later store the debit invoices which are
created internally, so that all information is stored permanently on optical
disk.
After indexing, FileNET's WorkFlo application software guides the invoices through a series of pre-processing steps. These steps require no operator intervention and interact with Ingram Micro's CAMBAR mainframe accounting application. The software checks the invoice to verify the vendor, purchase order (PO), and receipt of goods. If items have been received and the invoice amount matches the PO, then the invoice is automatically paid and no further processing is required. This automatic matching and payment accounts for about 50 per cent of invoices.
If there are no receipts to match the PO, the invoice is placed in a “rendezvous” work queue until goods are received. This pending feature automatically suspends invoices until all receipts are available, eliminating routing of work items that cannot be processed. To ensure that the company receives prompt payment discounts, any item that is approaching a payment deadline will be removed from the suspense queue for expedited processing.
When all items necessary for processing are available, the work is routed to an accounts payable associate based on the vendor. Each associate is presented with a prioritized list of work items in an electronic in-basket. The WorkFlo application integrates with Microsoft Access on the PC workstation to allow the associate to manipulate this electronic queue data, giving the associate optimal flexibility in the way the work is presented.
When an associate selects a work item for processing, theWorkFlo software presents the image of the invoice from the FileNET OSAR and the corresponding mainframe accounting data. The associate can enter appropriate general ledger codes, create debit memos, split an invoice across multiple receipts or choose to pend the item awaiting clarification. The associate may route to another user or send the transaction to the supervisor for review. In addition, the use of FileNET's WorkFlo/Fax allows an associate to quickly fax a debit memo directly from the workstation to a vendor.
Future plans for the system are improvement of the automatic match rate to decrease need for associate's interaction, expanding the system's capacity for use in international operations, and payment of invoices in foreign currencies.
The Bottom Line
With FileNET's document-imaging and WorkFlo/Payables solution Ingram Micro expects a return on investment within three years. WorkFlo/Payables has:
This success story courtesy of FileNet Corporation.