eSettlements “ Vendors like PeopleSoft have delivered what CFOs and Treasurers value most, a collaborative settlement solution that increases productivity

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eSettlements

“

Vendors like PeopleSoft have delivered what CFOs and Treasurers value most, a collaborative settlement solution that increases productivity and improves cash flow.

”Michael Killen,The Killen Group

Frederic PortalProduct Strategy Manager

Balaji Ramakrisnan Product Strategy Manager

The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions.The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle.

Agenda

• Procure to Pay Trends

• PeopleSoft eSettlements• Concept• Demo

• Conclusion / Customer Case

Market Challenges

• Process paper-based

• Reconcile invoices and resolve disputes quickly

• Supplier phone calls prevent your staff from doing their jobs?

• All invoices paid on time

• Take advantage of supplier discounts and maximization cash

• Supplier dispute ever shut down your business?

Inefficient Processes

…only 17% of the settlement cycle time is spent on approving invoices for

payment.

The remaining 83% is spent on mundane functions … keying-in paper invoice data

into AP systems and disputing discrepancies.

Aberdeen Group

Paper is Still King

Cost Risk Tied to a Non-Automated Invoice System

Improvement Area Performance Impact

Invoice Processing Cost Reduced 30-60%

Processing Cycle Time Reduced 65%

Accounts Payable Labor Reduced 25-40%

On-time Payment Percentage Improved from 15% to 59%

On-Time Payments Earning Discounts Increased up to 500%

Supplier participation 70-90% on average (in categories addressed)

Invoice Received in Electronic Format 55% to 90%

Payment Settled in Electronic Format Increase 65%

Source: Aberdeen Group, June 2005

Streamline Payables Processing

Sources: Gartner Inc., Invoicing and Payments: The Payer Value Proposition and Oracle Corp.

• $2.0 Billioncompany with100,000 invoices / year

• Wastes $1.5 Millionover 3 years

• Electronic transactions cost 60% less

Manual cost @ 8.50 / invoice

Electronic cost @ 3.44 / invoice

The Paper Premium

0

$1,000,000

$500,000

$1,500,000

$2,500,000

$2,000,000

1 Year 2 Years 3 Years

CumulativeCost Difference

Total Cost for an Invoice

Direct CostPostage

Paper

Clerk time

Indirect CostPrinting cost

Manual mistakes

Account

Reconciliation

Compliance

No utilization of discount term

Invoice Total Cost

Invo

ice

To

tal

Co

st

Source: AberdeenGroup, June 2004

• Reconciliation POs / Delivery notices / invoices:50 to 70% of AP staff time (often manual)

• More than 50% of calls received are payment related

• Dispute management is time consuming and costly

• Lost payment discounts: 1,5 to 2% of invoice gross amount

Settlement - Buyer’s pains

Payments Landscape

296B payments (est.)

Source: McKinsey, 2005

In aggregate, it’s still a paper payments world

20052009

63%

14%8%8%

5%2%

Cash Check Credit Cd

Debit Cd ACH Other

2004 2009

59%

9%8%15%

6%3%

Cash Check Credit CdDebit Cd ACH Other

240B payments

Agenda




The Flow

Supplier

CashManagement

AccountsPayable

Bank

Bank

Bank

ESettlement

XML

Introducing eSettlements

• eSettlements offers buyers a global electronic invoice presentment and payment solution:

• Electronic Invoices capture and presentment• Matching and non-PO invoices scenario• Online Approvals – header and/or line level• Dispute Resolution (online or offline)• Electronic Payments • Email Notifications (central setup page)• Complete Web-invoicing functionality

eSettlementsInvoices acquisition and process

E-invoicesE-invoicesEDI / XMLEDI / XML

Dispute resolution

2/3/4 way Matching

Approval

Payment

Optical Characterrecognition

Paper Paper invoicesinvoices

ManualManual keyed inkeyed in

3rd party

Supplier Supplier Web-invoiceWeb-invoice

And also Self-billing (SBI) and Evaluated Receipt Settlement (ERS) !

@ eSettlements

• Supports Business Service Provider (BSP)

Product Overview / Business Flow eSettlements Models

eSettlements Hub

eSettlements

eSettlements Hub, BSP

Payment

• Buyer Direct eSettlements

Each AP Business Unit can become a “Buyer”

Each vendor can become a “Supplier”

First, use the “Enable Buyer Direct” process to automatically register Buyers and Suppliers from existing data.

Add any missing data elements like email address and electronic banking information.

First, use the “Enable Buyer Direct” process to automatically register Buyers and Suppliers from existing data.

Add any missing data elements like email address and electronic banking information.

Step 1 – Supplier logs in theSupplier Self-Service eSettlements

Best Practice - Web-based Invoicing

Step 2 – Supplier selects information in restricted list

of values, copy from his PO lines

(or his receipts)

Step 3 – Once the web-invoiceis completed, the Suppliersubmits it to Buyer review

Step 4 – Buyer reviews the invoice and authorize to be registered

XML

Step 5 – The supplier can Print a copy of the invoice For his own recordsOr request an XML file forERP integration

Step 6 - The invoice followsthe buyer approval processfor payment.

SupplierSupplier

eS

ett

lem

en

tseS

ett

lem

en

ts

BuyerBuyer

Invoice

CreationMatching

Invoice

Approval

Select for

Payment

Payment

ApprovalPaid

B2B Collaborative Framework HTML

Dispute

Cleared

Buyer Bank

EIPP: A COLLABORATIVE PROCESS FOR BUYERS AND SUPPLIER

Product Overview / Business Flow

Payments Systems Today

Legacy System 1

ERP System

Bank System

Bank A

Bank B

Legacy System 2

Payment Report

Bank Internet Terminal

HTTP/S

FTP/S

AS2

Encryption Tool

Payment Report

ACH

Encryption

Encryption

Dispatch FTP

Integration Platform

Communication Platform

Transformation

Transformation

Source

Data

Source

Data

Source

Data

Bank System

Bank Internet Terminal

Bank System

Bank A

Bank System

Bank B

Legacy System 1

Source

Data

ERP System

Source

Data

Legacy System 2

Source

Data

$%^#!S@

Financial Gateway : Payment Hub/SSC

PAYMENT FACTORY

- Straight-through processing of all payments and receipts

- Centralized payment platform across the Corporation

- A true Hub (Hook to 3rd Party systems, other ERP…)

- Payment lifecycle – event tracking, notification, inquiry

PAYMENT FACTORY

- Straight-through processing of all payments and receipts

- Centralized payment platform across the Corporation

- A true Hub (Hook to 3rd Party systems, other ERP…)

- Payment lifecycle – event tracking, notification, inquiry

Financial Gateway

Out of the box integration

Out of the box integration

PaymentFactory

PaymentFactory

Central Format Repository

Central Format Repository

Central ControlCentral Control

Transport &

Security

Transport &

Security

Bank ConnectivityBank Connectivity

CENTRAL FORMAT REPOSITORY

- Delivered and extensible layout catalog

- Major payment formats built to industry specification

- Ability to configure easily additional formats

CENTRAL FORMAT REPOSITORY

- Delivered and extensible layout catalog

- Major payment formats built to industry specification

- Ability to configure easily additional formats

BANK CONNECTIVITY

- Bank Format Support

- Electronic Banking web service - extend enterprise application reach

for the “last mile” of integration

BANK CONNECTIVITY

- Bank Format Support

- Electronic Banking web service - extend enterprise application reach

for the “last mile” of integration

OUT OF THE BOX INTEGRATION

- AP, AR, eS, Treasury, Expenses

- E to E1

- Extendable Infrastructure for easy integration with any 3rd Party

OUT OF THE BOX INTEGRATION

- AP, AR, eS, Treasury, Expenses

- E to E1

- Extendable Infrastructure for easy integration with any 3rd Party

CENTRAL CONTROL

- Payment life cycle

Event tracking and notification

In-line payment analytics

- Minimize exception based processing

- Error validation framework

CENTRAL CONTROL

- Payment life cycle

Event tracking and notification

In-line payment analytics

- Minimize exception based processing

- Error validation framework

TRANSPORATION & SECURITY

- Real-time, seamless,

- Secure communication with Financial Institutions or 3rd party exchanges

- Direct communication capabilities (HTTP, HTTPs, FTP, FTPs, AS2)

- Industry standard encrypt/decrypt technologies (SMIME, PGP,

PKCS#7)

TRANSPORATION & SECURITY

- Real-time, seamless,

- Secure communication with Financial Institutions or 3rd party exchanges

- Direct communication capabilities (HTTP, HTTPs, FTP, FTPs, AS2)

- Industry standard encrypt/decrypt technologies (SMIME, PGP,

PKCS#7)

Transforming Payments Into a Strategic Weapon

eSettlements Highlights• Ease of Use

• Designed for both Buyers and Suppliers at all levels – from novice to expert

• Invoice Cycle for at-a-glance invoice status and history• Drill down into detailed transaction data

eSettlements Highlights

• Collaborative Tools to Improve Supplier Relations• Supplier access to transaction information through browser• Email notifications for exceptions, disputes, payments, remittance

information• Integration with Instant Messengers (Yahoo, AOL, IBM Lotus

Sametime) for dispute resolution

eSettlements Highlights• Extend access to Operational Users

• View invoice and payment status without having to learn the entire system

• Route invoices to authorized approvers throughout the buying organization

• Send only the relevant lines of an invoice to approvers

Suplier Home Page

Supplier Self-Service

Supplier can maintain their business information :

• Business ID / Tax ID’s• Address• Payment information• Factoring information

Address Payment/bank info Self-invoice entry

Supplier info self-maintenance

Seller Inquiries

• Receivables Aging Balance – in real time

Supplier Tools

• DSO Calculation

Results –Lower Costs

• Increases efficiencies in handling paper invoices (data entry, disputes, approvals and processing).

• Increases efficiencies in preparing payments, reviewing suspect items, and reconciliation.

• Reduces fees for paper disbursement services. Savings partially offset by electronic payment fees.

• More economical (online) data searching, analysis and dispute management.

• Better visibility of cash flow

Automate Your Payables Process eSettlements

• eSettlements offers buyers a global electronic invoice presentment and payment solution:

• Electronic Invoices• Matching (Configurable matching rules)• Digital Signature• Online Approvals• Dispute Resolution• Enable duplicate vendor setup checking• Email Notifications

Automate Your Payables Process eSettlements

• eSettlements offers best practice solutions to automate your Payables process:

• Electronic Invoices (Eliminate paper invoice (use ERS, web-invoicing, XML/EDI)

• Supplier Self-Service• Online Approvals• Online Dispute Resolution• Electronic Payment • Email Notifications• Use Excel Voucher upload• Take advantage of payment discounts• Matching (Configurable matching rules)• Enable duplicate vendor setup checking

ERS: Evaluated Receipt Settlements

Automate Your Payables ProcessEnable Supplier Self-Service

• eSettlements fully integrates with your PeopleSoft Payables :

• Requires activation, not implementation• Payables setup and data is automatically pulled• New roles / workflow / security are available• Buyer and Supplier Self-Service facilitates

enabling of new users• Web-invoicing allows your supplier to key-in

invoices effortlessly

• No visibility after the invoice is sent to buyer, no information about incoming payment

• No warning / alert mechanism when an issue arises (dispute, matching difference, wrong bank information)

• Need to pick up phone to ask “Where’s my check ?”

• Dispute management is time consuming and costly

• No information about the remittance information when a payment in made (partial, multi-PO’s, credit note applied)

Settlement - Supplier’s pains

Invoice creation• Invoices can be created online or received

electronically using XML/EDI connectors

• Supplier can key-in the invoice by copying PO or receipts lines

Agenda




Configuration of eSettlementCreation of the Buyer

Each AP Business Unit can become a “Buyer”


You might have to add the email address


Header Level Approval

Line Level Approval


Line Level Approval can be done based on chartfields, item, item category

Configuration of eSettlementChartfield access to the Supplier

You can empower your supplier to enter your invoice distribution

Configuration of eSettlementCreation of the Supplier

• You can pull a Supplier created in AP you just activate it as a Supplier in eSettlement

Configuration of eSettlementCreation of the Supplier

Each vendor can become a “Supplier

Configuration of eSettlementThe Buyer creates the Agreement

Next, create an Agreement between each Buyer and Supplier, with payment terms and processing options.

Configuration of eSettlement The Supplier reviews and accepts Agreement

Configuration of eSettlement The Buyer accepts the Supplier terms

Now you are ready to automate your payables process

Web-invoicingSupplier log in

Key features

Different Supplier roles delivered with workflows

•All suppliers pages secured on one or several vendor ID’s attached to the Supplier

Web-invoicingSupplier selects web-invoicing

Key features

Other menus available from this role :

•Review invoices and payment

•Extract invoices

•Supplier information review

Web-invoicing« Create invoice »

Key features

View invoices before buyer approves it

•Correct or Delete

•Print a pro-forma Invoice !

• Reduces paper processing

• Fewer errors

• XML, EDI, or Supplier Self-Service

Web-invoicing Copy from his PO lines or Receipts

Key features

•Security, Supplier selects information in restricted list of values

•Automatically detects tax situation

•Allow to key-in the invoice number of the supplier

•PO/receipts displayed are strictly secured

•Non-PO invoices supported !!

•Invoices can be created online or received electronically using XML/EDI connectors

Web-invoicingSelection form the PO lines

Key features

•System pulls only open PO’s for this supplier

•Multiple search criteria enabled

•Selection by header or detailed lines

•Drill down to the detailed PO

Web-invoicing Submittion to buyer or requester

Key features

•Supplier can add comments on lines

•Supplier can select the appropriate tax codes

•Save for later or submit to buyer

•Selected a chartfield to be keyed-in by the supplier !

Buyer reviews the invoice

Buyer log in

Buyer review invoices page

Buyer reviews the invoice

Key features

•Receive invoices electronically or self-service entry online

•No more keying, just validation

•Buyer Releasing the invoice

•Buyer run voucher build

Buyer run Matching

Invoice life cycle

Buyer approve the invoice

Match exception

Exception Processing

•Matching engine compares orders with invoices, receipts

Email Notifications

East Bay Travel invoice #243 from the Concord location dated: 2007-02-22 to buyer Massachusetts Operations has been flagged with a match exception.

This invoice will not be paid until the Buyer resolves this situation. Please contact Massachusetts Operations and reference Voucher ID: 00000013.

•Notification of matching exceptions can be sent to the buyer and the Supplier

Online Approvals

•Routed using pre-defined approval levels and amounts•Buyer users are alerted by email notification when there are new invoices to approve\

Online Approvals

•Worklist for approving invoices individually or all at once

Invoice Life Cycle

•Visual display of invoice status from creation to payment

Online Dispute Resolution

Invoice #243 payment schedule 1 dated 2007/02/22 has been resolved with the following comments:Received goods, releasing for payment

Voucher will now be processed.

•Notification of disputes and resolution sent to Supplier

Online Dispute Resolution

•Track conversations, resolve disputes, correct invoices

Financial Gateway Review and Select Payments

Payments Awaiting Response

Payments by Bank

Payments by Method

Payment in Error

Payments on Hold by Source

Financial GatewayPayments Confirmation and Verification

Financial Gateway Review and Select Payments

Online Dispute Resolution• Notification of disputes and resolution sent to Supplier

Why eSettlements ?

• eSettlements fully integrates your PS Payables :

• Payables setup and data automatically pulled• New roles / workflow / security delivered• Real time update of your invoices status• Activation, not implementation• Self-service features enable new users easily• Web-invoicing allows your supplier to key-in invoices

effortlessly

Keep it simple, but complete !Keep it simple, but complete !

Features & Benefits

• Reduces paper processing• Fewer errors• Handles a range of technology

capabilities

• Reduces response time through automation

• Improves communication

• Minimizes resources needed to process disputes.

• Better cycle time – more prompt-pay discounts, fewer penalties

• Electronic Invoices • XML• Supplier Self-Service

• Email Notifications• Match Exceptions• Disputes

• Online Dispute Resolution

Features & Benefits

• Online Approvals• Workflow, rules-based• Invoice• Payment

• Electronic Payments• Schedule disbursements• Review/modify scheduled

payments

• Enables timely decisions.• Automates business rules. • Lowers the incidence of lost or

delayed invoices and payments.

• Improves cash management.• May reduce borrowing expenses or increase investment income.• Improves forecasting ability.

Features & Benefits

• Buyer and Supplier Collaboration• Buyer and Supplier

Agreements• Notifications, alerts• Visual Workflow• Online Status Inquiries

• Invoice• Payment

• DSO Calculator • Aging Balances Reports

• Buyer Benefits• Reduces phone calls, faxes,

letters to and from suppliers• Reduces supplier maintenance

Negotiate discounts

• Supplier Benefits• Complete visibility into

transaction status• Notified automatically of invoice

errors, disputes• Increases control over

receivables, reduce DSO.

Multiple payment streams

High costs of paper processing

Lack of Financial Visibility

Compliance and audit trail

Multi bank, multi format

Centralized payment factory

Electronic Straight Through Processing

Real-time payment flow Real-time STP with complete visibility

Full audit trail with error handling

Non-proprietary, format independent payment processing hub

Web-services based offering

Issue Solution ProvidedVia Financial Gateway

11

22

33

44

55

11

22

33

44

55

Financial Gateway

A top US-Based Insurance Co

Background• 300,000 invoices annually from 40,000 vendors• 75% invoices electronic = 300 paper invoices per day• One centralized AP department, 25 AP employees plus outsourced services

Challenges• Medium-size vendors are source of most paper invoices and create heavy call volume into AP• Transact in EDI with large vendors and p-card with small vendors.

Solution•Phase I eSettlements roll-out to 14 medium-size vendors selected based on call volume• Scheduled go live in November• Will roll out to all vendors based on successful completion of Phase I.

PeopleSoft Enterprise Products

• eSettlements• FMS, EPM

Benefits

• Will minimize paper invoices and payables data entry

• Vendor self-service feature will reduce call volume into AP

• Will allow for headcount reduction, both with employees as well as contractors.

A top 3 worldwide retailerBackground• 39 millions invoices annually from 60,000 vendors• 20 countries

Challenges• 65%-70% of AP staff allocated on dispute management• 35%-30% of AP staff on invoice acquisition and matching• Decrease invoice processing cost by 50%

Solution• Phase I – rollout of eSettlements in pilot countries• Phase II – open the web vendor and web invoicing• Roll-out to all countries after successful deployment in phase I countries•

PeopleSoft Enterprise Products• eSettlements• FMS

Benefits

• Will minimize paper invoices and payables data entry

• Vendor self-service feature will reduce call volume into AP

• Looking to deploy web-invoicing (ERS & SBI) for mid-size and small vendors

SBI: Self Billing Invoice

AQ&

Additional Resources

• For More Information about our Products• http://www.oracle.com/products/

• For More Information about Education• http://www.oracle.com/education/index.html

• For More Information about Support• http://www.oracle.com/support/

• For Customer Connection Information:• http://PeopleSoft.com/

• Oracle Product Documentation:• http://

www.oracle.com/technology/documentation/applications.html

For More Information

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eSettlements

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eSettlements “ Vendors like PeopleSoft have delivered what CFOs and Treasurers value most, a collaborative settlement solution that increases productivity