A/P Becomes Strategic

The Accounts Payable function at Greif, Inc., is leveraging new technology to become a value-adding partner to the business


The Payables team also worked through the supply chain organization to reach out to key suppliers to understand their perspectives on the invoice issue. "We didn't want to do anything to harm the relationship that Supply Chain had developed with the suppliers, we wanted to enhance [those relationships]," Myers emphasizes. During preliminary conference calls with 10 of Greif's top suppliers, the A/P team explained their own ideas for addressing the challenge, discussed various options for making changes to the invoicing method and gave the suppliers an idea of the benefits that they could see as a result of changes to the current process.

Myers and her colleagues surveyed the solutions landscape and came up with an initial list of four different providers, each of which offered a different approach to addressing the invoice issue. The Payables team had mapped out the company's "as is" state and created a "to be" vision for where they wanted to take their invoice-to-pay process, then compared the different solutions' capabilities against their requirements to determine a "best fit." Greif ultimately elected to go with OB10, an Atlanta-based enabler that operates a global B2B e-invoicing network to capture invoices from suppliers and feed them into companies' financial systems. OB10 allows Greif's suppliers to electronically send invoices either automatically from their billing systems or manually through a Web form, across the OB10 network, and into the manufacturer's financial system. OB10's network does the required data translation that ensures compatibility between the suppliers' systems and those at Greif, and the solution applies digital signatures to invoices in cases where appropriate verification is necessary.

Greif went live with the solution last October, and initially the company rolled it out to its supply base in phases, starting with the larger raw material suppliers with high invoice volumes. Myers' team provided the suppliers with hardcopy and e-mail documentation explaining the new system, and OB10's support team participated with Greif on individual phone calls to ensure that the suppliers were able to register on the e-invoicing network and set up their data feeds to communicate invoices through the system. Greif also released the solution to smaller-dollar-volume suppliers that required more handholding to explain how to use OB10's Web portal to enter invoice data. Subsequent phases targeted the suppliers in between these two extremes, adding new suppliers in groups based on invoice volumes.

Becoming More Strategic

In all, to date, the company has onboarded about 180 suppliers into the system, and as of May the company was receiving 50 percent of its invoices through the network — significantly ahead of the 20 percent target that Greif had set for that point in the rollout. The goal, eventually, is to be at 100 percent — although the company will maintain the flexibility to handle one-off paper invoices in discrete cases.

Myers says that Greif applied both carrot and stick in working with its suppliers to get them onto the system. "We educated the suppliers on the benefits of [invoicing through OB10], not only for us but for them as well. We also showed them that the industry is headed this way, and if they sign up with us then they can do invoicing for other companies, too. But we wanted to take a very firm stance on it, and we were pretty direct. We did a lot of communication via e-mail and calls, letting [the suppliers] know that this is how they will have to invoice Greif in the future if they wish to do business with us. We haven't come to the point where we're not going to use a supplier anymore if they haven't signed up, but we didn't just give them this as an option for invoicing us." Still, Myers says that the company will look at suppliers on a case-by-case basis when necessary. For example, for key suppliers of a critical material, the manufacturer wouldn't stop doing business with them automatically just because they hadn't yet signed up for OB10.

Internal constituencies also received education on the new system. Myers' team sent out e-mails and conducted phone briefings with all the company's affected locations, explaining OB10, the process, how the rollouts were going to be conducted and the benefits. "One thing we didn't want was for a supplier to call Greif and have somebody tell them they had no idea what OB10 is or why we're doing it and that they should just continue invoicing the way they always have done it," Myers explains. "We wanted everybody to be familiar with OB10, understand what it was and the benefits and at least know who to direct calls to if they weren't sure."

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