Daily Archives: February 13, 2014

Basware: P2P for the Global “E” Part II

Late last fall, we introduced you to Basware, Procure-to-Pay for the Global “E”. Founded in 1985 in Espoo, Finland (as Baltic Accounting Systems), Basware has been delivering enterprise finance solutions for almost 30 years. Since its humble beginnings, it has grown to one of the largest global players in the Procure-to-Pay marketplace with over 2,000 international customers that collectively do business with over 1 Million companies in over 100 countries. In order to support this global customer base, Basware has had to create an operational footprint that spans over 50 countries on 6 continents which includes over 100 partner and resellers, including MasterCard and BravoSolution.

In our initial post, we noted that one of the most unique features of the platform is the fact that it spans the full AP and P2P cycles, whereas many of the smaller P2P and e-Procurement platforms are Procurement centric, with little support for AP. From the procurement side, the platform contains modules for analytics, basic sourcing, contract management, catalog management, e-Procurement, and e-Invoicing. From the AP side, the platform contains modules for e-Invoice Receipt (through the Basware Commerce Network), e-Invoice Processing, e-Invoice Matching, e-Payment, and Analytics. Furthermore, all modules are integrated with a consistent look-and-feel and all modules are available on top of Basware’s new cloud-based Alusa platform that supports (multi-)enterprise private cloud instances.

In that post, we noted we would dive deeper into AP automation and (e-)Invoice processing, matching, and payment capabilities; the Basware Commerce Network (BCN); and the associated analytics in later posts. This is the first post in that series, focussing on the AP automation and invoice processing capabilities.

The invoicing module, which works pretty much as you would expect based upon standard definitions and features implemented by their North American counterparts, has a few unique features that deserve to be highlighted. Namely:

  • full compliance with e-Commerce, Taxation, and Digital Signature Requirements in over 50 countries
  • full Purchase-to-Pay process coverage from the Procurement and the AP perspective
  • integrated plans and workflows

Even though North America might be behind when it comes to e-Commerce and digital signatures, and many of the North American Procurement providers might be behind when it comes to recognition of the various types of taxes and tax codes that exist around the world, Basware, which has been supporting (e-)commerce around the world for over a decade, is up to date on all of the digital signature requirements, tax codes, and audit trail requirements. With Basware’s solution, chances are you’re ready to conduct business in every country you operate in out-of-the-box. Basware has already been integrated with over 250 ERP, MRP, AP, and other back-office systems and e-Document/e-Invoice formats supported include, but are not limited to, Finvoice, Teapps, E2B, eHF, OIOXML, cXML, EDIFACT, UN/Cefact, CSV, EDI ANSI X12 (810), Svefaktura, OIOUBL, UBL, openTrans, and SAP iDOC.

Since the Procurement module directly integrates with the AP module, as soon as the invoice is received, it can not only be automatically matched (against any and all e-Documents that are appropriate), automatically processed for approval using the appropriate user-defined rules, and routed as required for error processing or manual approval, but analyzed from a financial perspective. What is the cash-flow impact of paying early, on time, or late? How long is it taking to get through the manual processing queue versus average processing time and what impact is it having on average cycle time? Are the payment terms in line with organizational standards?

One interesting capability of the AP Automation solution (which includes Basware Invoice, Basware Match-Orders, Basware Match-Plans, Basware Mobile, and Basware Analytics) is the ability to create and manage payment plans. Basware has found that 8% to 15% of invoices in an average organization are both ‘orderless’ and recurring. In order to handle these situations, Basware created plans that can be used to define a recurring invoice and special processing rules for dealing with them. For example, a cell phone bill will come in every month the cell phone is active. There is no reason that it can’t be automatically approved every month if it is within the expected and approved amount for the employee whom the cell-phone is assigned to. For example, the user can be assigned a base plan amount and a variable amount for long-distance charges, data charges, and/or roaming charges. If the amounts are within the maximums, or tolerances, the invoice can be automatically approved. If not, then the invoice will need to be routed to the employee’s supervisor or the budget manager for approval. All of this can be captured in a plan. The plan can define the source of the invoice, the purpose of the invoice, the different line items and charges that can occur on the invoice, different tolerances and limits for the base amount and variable amount, different approval routings for each rule violation, and an appropriate workflow, among other features. In addition, invoices can be flipped into plans. Furthermore, if an invoice contains additional or unexpected line items, they will be pulled out into separate cost allocations, which can then be added to the plan if required. Manual handling of the recurring invoice disappears completely if everything about the invoice is in-line with expectations and is minimized otherwise.

Finally, Basware estimates that it’s e-Invoice solution will bring a best-in-class €10.90 per invoice (and $17 USD) through its Basware Commerce Network, which will be covered in more detail in our next post.