IQ BackOffice's Client-Centric Business Process Outsourcing Services Provide Clients with the Competitive Edge

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Large Public Restaurant Chain

Large Public Automobile Manufacturer

Large Procurement Outsourcer

Large Public Restaurant Chain

A large public restaurant chain with over 160 restaurants as well as franchised operations in the US and internationally, came to IQ BackOffice with a need to establish a best practice Accounts Payable process that fully met their needs to achieve Sarbanes 404 compliance.

The client was experiencing the same issues that plague most geographically distributed operations: poor data quality for invoices entered at restaurants (10% of all invoices entered had errors), disappearing and reappearing invoices, a high level of duplicate invoices submitted by industry vendors, reliance on vendors for delivery of credits, a lack of well-defined business rules for Accounts Payable processing and turnover in their Accounts Payable department. All of this resulted in many opportunities to pay invoices late and to pay them multiple times. Of course, the cost to process all of these invoices and manage this process was very high. Management wanted a fully compliant process so they could focus their activities and capital on other more important issues facing a public company in today’s post-Sarbanes world.

Working together with the client, IQ BackOffice developed a new Accounts Payable process utilizing best practices for both restaurant and corporate expenses. Detailed business rules were developed for Accounts Payable processing to ensure consistency of outcome and quality. The client also utilized IQ BackOffice’s Archimedes technology to manage the process, providing greater control, three-sigma quality per invoice, and much greater levels of efficiency for client employees. We also worked with the client to implement a new credit process, ensuring that all credits due were taken.

The result has been a Sarbanes 404 compliant process, full management control over each and every Accounts Payable transaction, and complete accountability at the restaurant level. We were able to dramatically improve the quality in Accounts Payable processing, resulting in the elimination of errors including payment of duplicate invoices worth millions of dollars annually. Finally, our client was able to eliminate their Accounts Payable staff, saving significant additional dollars in reduced processing cost. 

Large Public Automobile Manufacturer

Like most automobile manufacturers, our client was facing significant cost pressure in a rapidly evolving industry.  The client realized their management and financial resources were better spent on more critical activities than Accounts Payable transaction processing.  But in their just-in-time manufacturing facility, few support activities were as critical as Accounts Payable, due to the importance of paying vendors on a timely basis to keep deliveries flowing to the plant.

As one would expect, they processed a very large volume of Accounts Payable, approximately 60,000 invoices per month.  Given the complexity of their manufacturing operation, they had a high percentage of exceptions, with over 800 employees involved in the Accounts Payable process and multiple information systems.  This also made it difficult to maintain management and financial controls over all of the invoices currently in process.  Resolving all of the exceptions was taking too much time from all of the process stakeholders.

IQ BackOffice was asked to help implement a new Accounts Payable process.  We spent several months understanding all of the different issues and types of exceptions.  As part of our process, we documented over 1,500 pages of business rules for the process and recommended changes to internal controls and how exceptions were resolved.

Our client now has a robust Accounts Payable process powered by IQ BackOffice.  The client has eliminated their Accounts Payable staff, saving significant dollars each year.  All managers involved in the Accounts Payable process now have real-time status on every Accounts Payable transaction.  And exceptions are resolved quickly utilizing IQ's technology.

Large Procurement Outsourcer

One of the largest outsourcers of procurement, with a list of Fortune 100 clients spread out in dozens of manufacturing plants and distribution centers all over North America, was growing very quickly.  In fact, they had just doubled through an acquisition and had additionally signed on several new clients, including one of the 10 largest companies in the world.

Like all manufacturers, distributors and retailers, they received large volumes of invoices for all of its purchases.  The Accounts Payable staff would open the mail and then try to match the invoices to outstanding Purchase Orders and Goods Receipts.  If it matched, the invoice would be processed and a payment sent to the vendor.  However, if it did not match (which was up to 30% of the time), the Accounts Payable clerk would put the invoice aside in a separate stack for exception processing and the real work would begin. 

Their accounting system, like all accounting systems, did not track exceptions or handle exception resolution.  So the clerk had to literally manage a stack of exceptions by researching the exceptions, calling vendors, and most often calling the buyers to assist them.  Sometimes the complexity was overwhelming with the business rules that dictated when things matched and when they didn’t, as well as the mix of non-matching invoices, receipts, PO’s and credit memos.  The business rules were not always clear-cut as to what matched and what didn’t, and the clerks had limited discretion over matching which exacerbated the number of exceptions that required vendor or buyer intervention.  The CFO had little visibility to what was going on until the invoices were approved and entered into the accounting system.  How many invoices are outstanding and what is their dollar value?  How many exceptions are outstanding and what is their cause?  Which vendors are being paid on time and which are not?  Which managers have invoices in their inbox and how old are they?  Vendors also had little visibility and would make numerous phone calls just to determine the status of a payment.  And all of this was expensive in personnel costs and valuable buyer and financial management time.  It was also an enormous headache for the Controller and CFO when they had much better things to do such as analysis and decision-making.

With invoice volumes growing by leaps and bounds, IQ BackOffice was called in to assist in managing the Accounts Payable process.  IQ BackOffice worked with the client to define detailed business rules and Accounts Payable business processes and then implemented state-of-the-art imaging and workflow solutions to route, match, manage and approve each invoice with six-sigma quality.  Vendors sent invoices to IQ BackOffice’s ISO 9001 certified service centers where they were scanned, coded and entered into appropriate systems, reviewed for quality, and matched appropriately.  Buyers and others were electronically notified of exceptions in their electronic inboxes to notify them of important vendor management issues.  IQ BackOffice’s solution allowed for automated, timely and efficient exception management and resolution.  Both the client and vendors could log on to secure websites to generate reports of Accounts Payable status and exceptions, giving them real-time and more information on the Accounts Payable process than ever before.  Most importantly, the CFO, Controller, and buyers greatly improved their productivity, removed an enormous headache and now focused on important issues.  And the client reduced their Accounts Payable processing costs by over 50%.

Now the client can focus on growing their business, content in the knowledge that their Accounts Payable process, a critical part of their business, is being managed to world-class standards at a substantially lower cost.