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PROCURE-TO-PAY (P2P) PROCESS ENHANCEMENTS STATUS REPORT

PROCURE-TO-PAY (P2P) PROCESS ENHANCEMENTS STATUS REPORT. THROUGH APRIL 2007. Procure-to-Pay Process Enhancements FY06 Results. Payment within supplier terms increased 4% FY06 over FY05 PO Invoices on hold greater than 30 days were reduced by 73% 8 Schools/Centers reached zero holds > 30 days

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PROCURE-TO-PAY (P2P) PROCESS ENHANCEMENTS STATUS REPORT

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  1. PROCURE-TO-PAY (P2P)PROCESS ENHANCEMENTSSTATUS REPORT THROUGH APRIL 2007

  2. Procure-to-Pay Process EnhancementsFY06 Results • Payment within supplier terms increased 4% FY06 over FY05 • PO Invoices on hold greater than 30 days were reduced by 73% • 8 Schools/Centers reached zero holds > 30 days • 6 Schools/Centers reduced holds > 30 days by 80% or better • PO Invoices Not Entered In Within 30 Days were reduced by 15% • 10 Schools/Centers attained 50% reduction or greater • 5 Schools/Centers attained 40% reduction • PO Approval After Supplier Invoice Date were reduced by 16% • 8 Schools/Centers attained 50% reduction or greater • 3 Schools/Centers attained 40% reduction • Invoice Rejections were reduced by 42%

  3. Procure-to-Pay Process EnhancementsKey Performance Metrics • PO Supplier Payment Performance • This metric is the key indicator for payment results which are driven by eliminating the following process exceptions • PO Invoices on Hold Greater Than 15 Days • Invoice holds are not being cleared in a timely manner resulting in late payments • FY07 Goal is zero greater than 30 days by 12/1/06 and zero greater than 15 days by 6/30/07 • Cycle time for PO Managers to clear holds should be 7 days or less • PO Invoices Not Entered In Within 30 Days • Invoices are being received in the departments and not forwarded to AP in a timely manner to ensure payment within terms • Procurement policy states all PO invoices should be sent directly to AP by the supplier • PO Approval After Supplier Invoice Date • PO’s are not properly approved before the purchase • PO’s are being created and approved after the supplier invoice is received • Potential exists for double payment or shipment and purchase commitments are not properly stated • C Form Processing • Expenditures are not subject to approval before the purchase • C Forms are a totally manual process and represent 25 to 30 % of AP transactions processed • Wider use of PO’s would better leverage University spend • Invoice Rejections • Invoices are rejected and returned to suppliers when they do not have the proper PO number or vendor information or if the PO has been finally closed • This results in extensive manual re-work for both Schools/Centers and AP

  4. Procure-to-Pay Process EnhancementsPO Supplier Payment Performance • PO Supplier Payment Performance: • FY 2007 Goal - Increase invoices paid within terms to 75% or higher • FY 2006 Baseline 59% • For March 2007 PO invoices paid within supplier terms were 74%, an 11% increase from February • YTD payment performance through March 2007 was 60% a 1% increase over the FY06 baseline % Payment Within Terms

  5. Procure-to-Pay Process EnhancementsPO Invoices on Hold • PO Invoices on hold greater than 30 days: • FY 2007 Goal – Eliminate holds > 30 days and move holds processing to within 7 days • FY 2006 Baseline is 246 holds as of June 30, 2006 • YTD holds > 30 days decreased to 224, a 9% decrease over the baseline Invoices on Hold > 30 Days

  6. Procure-to-Pay Process EnhancementsPO Invoices on Hold NEW MEASUREMENT DECEMBER 1, 2006 • PO Invoices on hold greater than 30 days: • FY 2007 Goal – Eliminate holds > 15 days by June 30, 2007 and move holds processing to within 7 days • FY 2006 Baseline is 503 holds as of November 30, 2006 • YTD holds > 15 days decreased to 392, a 22% decrease over the baseline Invoices on Hold > 15 Days

  7. Procure-to-Pay Process EnhancementsPO Invoices Not Entered Within 30 Days • PO Invoices not entered into BEN within 30 days: • FY 2007 Goal – 50% reduction in this exception. Long-term goal is zero exceptions. • FY 2006 Baseline is 3,315 average monthly exceptions for FY 2006 • April 2007 invoices not entered in 30 days decreased to 2,073, a 38% decrease over the baseline Invoices Not Entered Within 30 Days

  8. Procure-to-Pay Process Enhancements PO Approval After Supplier Invoice Date • PO approval after the supplier invoice date: • FY 2007 Goal – 50% reduction in this exception. Long-term goal is zero exceptions. • FY 2006 Baseline is 2,500 average monthly exceptions for FY 2006 • April 2007 PO approval after the supplier invoice date decreased to 1,253, a 50% reduction over the baseline PO Approval After Supplier Invoice Date

  9. Procure-to-Pay Process Enhancements C Form Processing • C Form Processing: • FY 2007 Goal – 20% reduction in C forms processed. Long-term goal is zero exceptions. • FY 2006 Baseline is 6,840 average monthly C forms processed for FY 2006 • April 2007 C form processing was 6,288, a 8% decrease over the baseline C Form Processing

  10. Procure-to-Pay Process Enhancements Invoice Rejections • Invoice rejections: • FY 2007 Goal – Reduce invoices rejected by 50% • FY 2006 Baseline is 555 invoice rejections from June 2006 • February 2007 invoice rejections decreased to 212, a 62% decrease over the baseline Invoice Rejections

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