Respond to Intensifying Financial Risk

Respond to Intensifying Financial Risk and Achieve Tangible Net Savings:

A Holistic PeopleSoft Suppler Source to Treasury Cash Management System

Presented by Mayda Barsumyan, President of Business Escalation

Mayda Barsumyan, President

Business Escalation, Inc. is a leading Source to Cash Oracle Platinum Partner with a team of seasoned finance and management professionals offering cash management products and services. Government agencies, companies in the public and private sectors, not-for-profit groups, and Fortune companies look to Business Escalation for software centralization and treasury consultation. Business Escalation, Delivering Enhanced Profitability

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

What you’ll learn today…

• Best practices to achieve tangible net savings

• How companies in the fields of healthcare, energy, manufacturing and higher education achieved their finance department goals

• What is Supplier Source to Treasury Cash?

• Settlement automation

• Tips and tricks

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Did you know?

• Base on industry norms, less than 50 percent of IT projects finish on time and on budget.

• Queensland Department of Health payroll project ended in a debacle that cost $1.2 billion.

• In the U.S., the Expeditionary Combat Support System, an enterprise resource planning software project, was canceled after the U.S. Air Force spent $1 billion on its development.

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Why did these projects fail?

• Fuzzy goals

• Overly optimistic

• Little comprehension of project complexity

• Weak ownership

• Lack of understanding of the corporate culture

• Lack of overall understanding of integration between departments

and relational data

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Treasury Challenges

CFOs/Treasurers in public and private sector companies serve as financial risk managers. • Liquidity Risk • Credit Risk • Currency Risk • Interest Rate Risk • Operational Risk CFOs/Treasurers are increasingly assuming a more strategic role.

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

What is the value of PeopleSoft Supplier Source to Treasury Cash?

Provides tools that allow CFOs/Treasurers to make informed decisions and mitigate risk • Streamline banking • Reduce cost of bank-related fees via bank account optimization • Implement a single source to cash management system • Implement a single source banking communication channel • Exceed expectations on eliminating unproductive manual efforts • Improve cash management structure and account pooling • Increase in trade finance

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Industry Case Study

Healthcare Staff of 13 Top 20 supplier invoices: 45% Top 50 supplier invoices: 60% Non-PO invoices: 25% Invoices processed (December ‘14): 1,112,525 Measurement: cycle time

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Goals: Meet cycle time Eliminate paper Reduce non-PO invoices Predicable cash flow

Industry Case Study

Energy Staff of 9 Top 20 supplier invoices: 70-80% Number of invoicing suppliers: > 2,000 Non-PO Invoices: 25% Invoices processed (December ‘14): 554,575 Measurement: Invoices processed by FTE

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Goals: Eliminate paper Realize early payment discounts Electronic payments

Industry Case Study

Higher Education Staff of 60 (many low pay, high turnover) $300K deficit Total Invoices: 450,000 T&E: 90,000 Measurement: Timely invoice payments

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Goals: Implement eSettlement Realize early payment discounts More virtual card payment Increase operational cash

Industry Case Study

Manufacturing 180 centers ~ 180 individuals Decentralized review of invoices Invoices processed (December ‘14): 122,917 20 of 180 centers live with invoicing Measurement: Cycle time

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Goals: Streamline review process through decentralization Increase end user visibility Reduce errors and payment issues Manage operational short-term cash Predict daily operational cash needs

Sample Source to Cash system

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Deposit Check/ACH

Organization

Banking Institution

Banking Institution

Suppliers

Online Banking

Supplier Source to Treasury Cash – Best Practices

Practice smart supplier sourcing

Broaden supplier self-service

Establish a centralized VMO Best-in-class organizations implement a portfolio approach, leveraging the advantages of multiple tools: • Electronic invoicing with workflow • Purchasing card solutions • Electronic payment platforms

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Supplier Source to Treasury Cash – Best Practices

Electronic invoicing presents the best option for addressing the majority of invoice types, supplier capabilities, and best complements electronic payment approaches

Maximize relationship with financial institutions

Define AP / Procurement Role v/s Treasury

Minimize operational risk

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Settlement Automation – Industry Perspectives

Accounts Payable is a largely forgotten process at most organizations, yet represents sizable untapped opportunities

Having a settlement strategy is increasingly required to optimize and complement strategic sourcing

Reducing transactional costs alone typically justifies automation projects:

• $34 per invoice $12.50 per invoice (>60% improvement) • Labor reduction of 25-40% • Cycle time decreases of 65%

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Settlement Automation – Industry Perspectives

Other benefits include significant increases in: • Timely payment rate • Payments earning discounts • Cash flow management • Control and risk mitigation • Capture and reporting of negotiated procurement savings “Automation” is the #1 interest area for AP managers, yet fewer than 25% of organizations have any significant settlement automation in place

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Projected savings from payment solutions

At full deployment of PeopleSoft • On average savings at full deployment = $1.75 million to $2.95

million • On average additional profits of $1.46 million To consider • Maximum rebate enhancer • Dynamic discounting

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Tips & Tricks – A Holistic Approach

• Chart the treasurer’s vision and clearly define business processes to carry this vision

• Review existing configuration • Ensure that system configuration is molded to support future

business processes • Think outside of the box • Explore creative configuration techniques • Maximize the rules-based functionality to achieve the processing

you need • Understand your integration points with other modules

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Thanks for your time!

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Questions??

7733 Forsyth Boulevard, Suite 1100 Clayton, MO 63105

Locations & Contact

Contact Information Phone: (888) 594-9919 eFax: (877) 278-2530 E-mail: info@businessescalation.com Web: BusinessEscalation.com

Locations Missouri Clayton, MO (Headquarters) 7733 Forsyth Boulevard Suite 1100 Clayton, 63105

Florida 801 Brickell Center 801 Brickell Avenue, Suite 900 Miami, FL, 33131