Archer Daniels Midland: The Journey from 100% Paper to 100% Digital
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The document details Archer Daniels Midland's transition from a paper-based to a digital procure-to-pay process, showcasing the implementation of Tradeshift's software to enhance efficiency and collaboration with suppliers. Key objectives include reducing transaction costs, improving payment processes, and standardizing invoice handling across North America, along with metrics showing significant improvements in payment rates and reduced processing times. Future steps involve continuing supplier onboarding and global rollout of the digital platform.
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Archer Daniels Midland: The Journey from 100% Paper to 100% Digital
- 1. March 25th, 2015 Purchase to Pay Advisory Webcast Archer Daniels Midland The Journey from 100% Paper to 100% Digital Presented by:
- 2. 2© 2015 The Hackett Group, Inc. All rights reserved. Reproduction of this document or any portion thereof without prior written consent is prohibited. Agenda Introductions and Housekeeping Archer Daniels Midland The Journey from 100% Paper to 100% Digital Questions and Discussion Webcast Feedback and CPE Request
- 3. Archer Daniels Midland The Journey from 100% Paper to 100% Digital March 25, 2015
- 4. Nick Shields Operations Supervisor Archer Daniels Midland Company Vishal Patel Senior Marketing Manager Tradeshift
- 5. Transforming how businesses work together. Tradeshift helps buyers and suppliers connect, transact and collaborate with e-invoicing and procure-to-pay software.
- 6. Easy to use. Free for suppliers. Tradeshift brings you intuitive, agile, scalable software. We strengthen buyer-supplier relationships through the power of our network, our proven supplier onboarding methods, and our scalable platform & app ecosystem.
- 7. Connected Buyers & Suppliers Global business network collaborating in real time on a scalable, secure cloud- based platform Electronic invoicing, PO’s, ASNs, credit notes, etc Data capture (paper, PDF, fax, email), onboarding tool Matching, validation, approval, routing, coding, direct communication Supplier registration, onboarding, information validation & management Extension of capabilities with customer or third-party apps Early payment solutions. Dynamic discounting & supply chain finance
- 8. Key Facts CY13 net sales $90 B Employees 31,000 Facilities 740+ Country sales 140+ Market cap ~$28 B* NYSE: ADM Premier Player in Global Agribusiness Serving Vital Needs Throughout the World 54% 30% 14% 2% Ag Services Oilseeds Processing Corn Processing Other CY13 Segment Operating Profit $2.71 Billion *As of Mar. 17, 2014
- 9. Drivers for Automating the AP Process The North American Shared Services Center: • Receives 2,600 PO invoices a day • 8 people dedicated to error invoices & send out 66,000 invoice exception notifications a year • 32 Temporary Staff in AP process • Manually key 950,000 invoices a year • Manually scan 950,000 invoices a year • Receive 37,000 duplicate invoices a year • Receive 24,000 calls & 58,000 e-mails annually requesting payment status
- 10. Objectives Strategic / High-level • Reduce Costs Per Transaction • Improve Collaboration and Visibility for Suppliers • Standardize Global Invoice Processing Other • Reduce Reliance on Temporary Staff • Increase On Time Payment Rate and Discount Capture • Improve Error Resolution Process • Reduce Resources that Handle Paper (Scanning, Mail, etc.)
- 11. Procure-to-Pay Journey 1. September 2012 – Procurement Issued North American Procure to Pay Policy 2. January to June 2013 – Centralized Invoice Processing to North American Shared Services Center from Processing Facilities (350 + locations) 3. July 2013 – Instructed suppliers to invoice directly to Shared Services 4. October 2013 – Sent out RFP to 7 eInvoicing Providers 5. May 2014 – Project Kickoff with Tradeshift
- 12. Why Tradeshift? • Global presence & global compliance • Modern and innovative technology • Intuitive and very easy to use • Ability to extend capabilities at any time in the future • Many different invoicing options • Free for suppliers • Value creation for suppliers “The Tradeshift platform will allow us to innovate and improve collaboration and transaction efficiency across our global supplier network without disrupting our existing infrastructure.” Suzanne Leopoldi-Nichols Director, ADM Shared Services Group
- 13. ADM Resources Needed • IT and Business Unit Sponsor • Project Manager • 3 Subject Matter Experts in AP • Business Analyst from IT • 1-2 Programming Resources • 2 Part Time Resources for Vendor Onboarding • Procurement Resource
- 14. Project Timeline Feb. 6 #5a New Supplier Registration #1 PDF Streaming (2 Wks) #5 Supplier Management #4 Collaborative Workflow #3 CloudScan AP (on hold)#2a PO (7 Wks) #2c Status (5 Wks) #2b Inv/CN (6 Wks) We are here May 23 Jul. 18 Aug. 29 Oct. 3 TBD TBDMay 12 #2 E-Document Exchange #5b Enhancements TBD TBD 20152014 #4a Users (11 Wks) #4b Receipt WF (5 Wks) #4c PO WF (TBD) Dec. 19 #4d NPO WF (TBD) TBD • Complete Automation of Workflow • Continue Onboarding Suppliers • AP Cloudscan • Global Roll Out Future Steps
- 15. Supplier Onboarding • Targeting 25,000 supplier base o 250 ‘White Glove’ Suppliers (highest volume) o E-mail and Direct Mail Campaign for Remainder • Host Regular Supplier Webinars • Mixed Reaction from Suppliers Depending on “Tech Abilities” • Good Experience Working with the Network Growth Team
- 16. Lessons Learned • Quality Purchase Orders • Buyers Following Policies and Procedures • Communication of Changes • Taxes • Vendor Onboarding
- 17. Benefits of Tradeshift (< 1 Year) Metrics • Improvement in Discount Capture Rate – 24% • Improvement in On-Time Payment Rate – 30% • Reduction in invoice processing time – 21.8 days • Reduction of Keying and Scanning of invoices – 7.7% • Reduction of Temporary Headcount – 6 Other • Improve Visibility and Communication for Suppliers • Eliminate Lost Invoices • Reduce likelihood of rejected or returned invoices due to missing data
- 18. What’s Next? • Continue Onboarding Suppliers • Global Roll Out • Supply Chain Financing
- 19. Questions? Please use the chat box to submit your questions.
- 20. Agenda Introductions and Housekeeping Archer Daniels Midland The Journey from 100% Paper to 100% Digital Questions and Discussion Webcast Feedback and CPE Request
- 21. 21© 2015 The Hackett Group, Inc. All rights reserved. Reproduction of this document or any portion thereof without prior written consent is prohibited. Amsterdam | Atlanta | Chicago | Frankfurt | Hyderabad | London | Miami Montevideo | New York | Paris | Philadelphia | San Francisco | Sydney | Vancouver Contact information Amy Fong P2P Program Leader [email protected] Vishal Patel Sr. Marketing Manager - Industry Solutions Mobile: +1.781.492.2525 [email protected] tradeshift.com ׀ tradeshift blog
- 22. 22© 2015 The Hackett Group, Inc. All rights reserved. Reproduction of this document or any portion thereof without prior written consent is prohibited. Statement of Confidentiality and Usage Restrictions This document contains trade secrets and information that is sensitive, proprietary, and confidential to The Hackett Group the disclosure of which would provide a competitive advantage to others. As a result, the information contained herein, including, information relating to The Hackett Group’s data, equipment, apparatus, programs, software, security keys, specifications, drawings, business information, pricing, tools, taxonomy, questionnaires, deliverables, including without limitation any benchmark reports, and the data and calculations contained therein, may not be duplicated or otherwise distributed without The Hackett Group Inc.’s express written approval. www.thehackettgroup.com