Temporary and agency workers
Our client deals with a large number of temporary and agency workers.
It was recognised by Accounts Payable that they could re-engineer their administration process to save cost. But more importantly they could implement tighter processes for authorising payment and pro-actively managing suppliers with the Procurement department.
Volume of invoices
The primary issue they faced was pressure to process a large volume of invoices in a timely manner. Each invoice needed to be checked by the hiring manager that it was ok for payment and be referenced against contracted rates.
Invoice sign off
With pressure to get sign off for payment, the question was, had all timesheets been checked thoroughly prior to signed off? Were invoices all at the agreed rate?
Spot checks revealed a patchy audit trail and over time the number of exceptions to agreed rates built up on contracts which took up valuable time in supplier reviews. With verbal and email agreements there was not a systematic way of checking exceptions in rates and questioning if they were necessary.
The issues of timeliness and contract compliance combined with the effort required from Accounts Payable, Accounts Receivable, Hiring Managers and Procurement required a radical re-think.
Re-engineer timesheet approval - invoicing process
The original laborious process was:
- Timesheets signed off by Hiring Managers
- Send Timesheet copy to supplier – CUT OUT STEP
- Suppliers raise invoices – CUT OUT STEP
- Accounts Payable log invoices – CUT OUT STEP
- Hiring Managers check & goods receipt invoices – CUT OUT STEP
- Account Payable make payment
- Supplier check that payment had arrived as per invoice.
If timesheets were web based, included the contracted rates, were signed off by the Hiring Manager and accessible to the Supplier, then why not create a consolidated weekly self-bill invoice and send payment at the same time to the supplier along with a timesheet link?
Cut out steps 2, 3, 4 & 5. Less admin for everyone and swift payment.
A project was set up to implement self-billing invoices by Accounts Payable and Procurement departments. 360 Agency Gateway was put in place to manage supply of agency workers, against contracted rates and web based timesheets. 360 Agency Gateway’s invoicing module was integrated with the SAP finance system to hook into the payment process. The self-billing invoice function was configured to enable hiring managers, suppliers and procurement to self-manage the process the process end to end.
Implementation of self-bill invoices requires agreement with suppliers that they are happy to work in this way. This needed contractual changes, planning and trialling the new process to ensure that the self-bill invoices were correct and acceptable to suppliers.
Strictly controlled and policed
360 Systems Implementation team were able to take a leading role in managing the project and developing the new streamline processes as well as integrating self-billing invoices, timesheet and contract management software with SAP Finance.
Following rigorous testing and a successful trial the self-billing invoices project was rolled out to all suppliers.
Set contract rates
Agreed contract rates are set in the 360 Agency Gateway System.
Candidate workers put forward for roles by suppliers are submitted at the correct rate. If there is a deviation to the contracted rate it is explicitly stated at the start of the selection process and is flagged to managers and Procurement to authorise and reference in supplier reviews.
Each worker completes their online web timesheet and sends to the hiring manager for approval. The timesheet includes the correct rates and any increments due.
Suppliers are able to access the timesheets for the workers that they have supplied so that they can complete their own reconciliation process or chase up workers that have not completed their timesheets.
Self bill invoice
On a weekly basis a consolidated self-bill invoice is created for each supplier by 360 Agency Gateway that includes timesheets that have been signed off by the hiring manager. The self-bill invoice is sent to our client’s SAP ERP System to process payment and to the Supplier as their official invoice.
The benefits of a well run Self-billing Invoice project include:
- Makes invoicing easier
- Speedy payment process
- Few queries
- Pro-active supplier management
- Annual contract reviews
- Redeploy Accounts Payable clerks
- Customer works out value of delivered goods & services
- Invoices automatically created from the approved timesheets
- Consolidated invoices in a standard format
- Invoice can be automatically loaded into ERP systems such as SAP
- Reduced administration for both customer & supplier