In Focus: Corporate Express Automates the Accounts Payable Process

It's a bit ironic that Corporate Express is doing its best to cut down on paperwork. After all, the $4.5 billion office supply giant is a leading supplier of paper to businesses and government agencies throughout North America. But when a consulting firm was hired to review all aspects of the company's financial management last year, its advice was simple: Automate wherever possible. For the accounts payable department, which processes about one million invoices per year (with an average of 3.5 pages per invoice), it was a prescription for document imaging.

With an information systems (IS) staff of 350 and a separate business services planning department, Corporate Express' approach to the project was methodical and disciplined. In a three-month process, IS and business leaders identified current costs, project risks and scope as well as desired system requirements before they interviewed a single vendor.

"We over-architected knowing that that there would be many other imaging projects we would take on once we finished the AP project," says Scott Rolfs, director of IS. Just five years ago, Corporate Express couldn't have hoped for much automation in the AP department because the company deals with more than 12,000 different suppliers, each with its own invoice layout, terminology and numbering scheme. Image capture systems of the day relied on template-driven optical character recognition (OCR) to extract relevant data, which meant they could only handle consistent forms. But as I reported last week, classification and extraction technologies have improved to the point where capture systems can now process variable documents such as invoices, shipping documents and explanation-of-benefit forms with minimal manual data entry, editing and validation.

Once planning was completed, Corporate Express interviewed five capture vendors that could handle variable invoice processing. The company narrowed the field to two, for what Rolfs says was a "grueling" proof-of-concept bakeoff. Each supplier was given three to four days to get its software running onsite, integrated with instances of Corporate Express systems including PeopleSoft/Oracle and EMC Documentum, and processing invoices from Corporate Express suppliers.

"We developed objective scorecards and ranked all aspects of performance, and we also monitored the hardware, including CPU usage and throughput, knowing that we wanted to go beyond the 3.5 million pages per year we would need to handle for the AP project," says Rolfs.

The product selected was Ascent Capture from Kofax Image Products, and Rolfs says Corporate Express has been pleased with the outcome of its three-phase deployment. Invoices for the company's own private-label goods (supplied through brokers) were the first to be automated last December. These single-page invoices are consistent and under Corporate Express' design control, and Rolfs says they're now handled in lights-out fashion.

"Private-label goods account for about 15 percent of our invoices, and we're getting 100 percent recognition rates, so they don't have to be touched once they're scanned," he says.

Invoices for the company's "non-trade" office supplies and furniture products were brought online in early February and late March 2006 with minimal difficulty. Despite the fact that these invoices are more variable and often include multiple pages and line-item detail, Rolfs says automated data extraction, recognition and validation rates have exceeded 85 percent.

With the AP project completed, Rolfs says his department is working with Corporate Express' records management group to identify documents such as contracts that can be scanned and brought into Documentum. He's also eying document-related processes that can be automated, such as travel and expense reporting, and credit and collections activities.

"We delivered on our targets and then some on the AP project, and we want to leverage the infrastructure as much as we can," he says. "We can do almost any type of project without bringing on more servers or buying more software because we planned for the future."