A road transport manufacturer looks deep into its AP processes with PlusOne.
Like many users, Phil Pole switched to PlusOne because it was time to automate the drudgery out of his accounts payable processes. The immediate benefit was something quite different: PlusOne lifted the lid on what Pole politely describes as “unhelpful” back office practices that were opaque at best and, at worst, were eating away his company’s profitability.
Pole is the National Finance Manager for Fruehauf, a privately-owned builder of truck bodies and trailers. He joined Fruehauf’s South Auckland head office in April 2016 and almost immediately started looking for an electronic alternative to the company’s existing paper-based AP process. In a previous role he had been introduced to streamline’s PlusOne cloud-based system at a Sharp New Zealand technology show. After completing due diligence, he chose PlusOne over OCR-only alternatives because, he says, “it gets rid not only of the paper but also most of the data-entry overhead.”
Fruehauf switched the system on in September that year and Pole reckons the benefits of automation are starting to show up in, for example, his first-thing-in-the-morning check on invoices in the system. “I’ll grab a coffee and see what’s happened overnight. Now we’re seeing something like 40 invoices processed without us lifting a finger, and that figure is climbing.”
Those benefits are welcome but predictable, Pole says. What surprised him is the light that PlusOne shone into Fruehauf’s long-established invoicing practices. Right off the bat it revealed a queue of 700 invoices that hadn’t been processed. More than that, the solution simplified three-way matching and that quickly highlighted inconsistencies in receipting and in matching invoices to PO values.
“We discovered one case, for example, in which we’d received a $10,000 invoice against a $9000 PO,” Pole recalls. “Instead of querying the invoice, someone had simply adjusted the PO. Examples like that meant we couldn’t close the books each month, but they’re also a weakness in the process that did have an impact on profitability.”
Pole says the broken processes weren’t malicious and were perhaps inevitable in a geographically distributed business lacking the kind of AP disciplines that PlusOne enforces. He moved quickly to introduce some financial hygiene, something he says required commitment from branch management and changes to the way Fruehauf manages inventory.
There’s still some way to go in the journey, but the outstanding invoices tally has shrunk to less than 100 and Pole’s team is on track to meet his target of completely automating 90 percent of invoices. The lesson, he reckons, is that you don’t know what’s under the covers until you lift them. “We did have inklings about internal processes that weren’t working very well,” Pole says, “and PlusOne found them for us.”