Burgmann Industries: Automatic invoice processing

Success Story:	Automated Invoice Processing
Customer:	Burgmann Industries GmbH & Co. KG, Wolfratshausen, Germany
Systems integrator:	Interact Consulting AG
Products:	PROSAR-AIDA, PROKEY
Publications:	Success Story (PDF)
The Company:	With more than 50 subsidiaries, joint ventures and affiliated companies, a workforce of over 3200 employees and an annual turnover of 335 million Euro in 2005 Burgmann Industries ranks among the leading manufacturers of sealing technology worldwide. Since its foundation 120 years ago, Burgmann Industries has played a decisive role in developing seal technology, and throughout that time its concentration on seals as core business activity has guaranteed the company’s success. The product range includes: mechanical seals, gas lubricated seals, seal supply systems, magnetic couplings, stuffing box packings, static seals, automotive seals, rotary kiln sealing systems and expansion joints. In particular the Burgmann gas lubricated mechanical seals for pumps, agitators and compressors provide the most modern sealing solutions concerning economy and environmental protection. The continuingly high level of investment activity has been principally directed at extending Burgmann’s international infrastructure, renewing machinery and expanding production capacities and research and development activities.
The initial situation:	The delivery from the central mail room to the local departments at different locations was, among others, the cause of the highly unproductive throughput times in the process. The internal processing of incoming mail, beginning with controlling in the purchasing departments through to payment processing of the amounts via the financial accounting department, was supposed to be improved at Burgmann Industries. The decentralised company organisation, the comparison of invoice items with order transactions and the internal co-ordination required very long processing times and increased personnel expenses.
The challenge:	Due to early automated recognition and extraction of invoices, adjustments to the processes and control of electronic workflows in the existing Documentum document management system were required. During the selection of qualified companies Burgmann Industries set a high value on specialised experiences in the areas of scanning and text recognition (OCR). The crucial factors for the chosen technology were the use of leading, proven and tested standard products, high scalability of the solution and experience and professionalism. Burgmann Industries suppliers submit invoices with an almost infinite variety of layout. With over 3000 active suppliers of Burgmann Industries, the use of templates for vendor invoices within the system is not possible or practical, so the document information should be recognised irrespective of form.
The solution:	In order to increase efficiency, Burgmann Industries started a project with Interact in May 2004 that was implemented with Interact’s system solution CapturePay (the scanning and capture solution for automated invoice processing) as well as Paradatec’s PROSAR-AIDA (pls. see fig. 1). The capturing system (Freeform OCR) reads every document and chooses, with the help of rules (rule type), how to process each document. These rules are freely definable and correspond to manual processing decisions, for example that the value-added tax amount is usually found to the right of the term “VAT” or “value-added tax”.   Fig. 1: Automated invoice processing at Burgmann Industries - Process steps    Each invoice document is centrally scanned after delivery. From now on all invoices of the 3000 distributors are processed electronically. With reference to the distributor database of Burgmann Industries, and using independent from different invoice forms recognition technology, the system independently records so called “master data”. Additionally the system reads needed details from the documents e.g. Order- and Invoice number as well as invoice date, currency, gross-, net- and VAT values. Extensive features such as total sum and single amount comparisons help to avoid processing failures.
The bottom line:	Now only the uncertain and wrong values get corrected by manual data capture instead of complete documents (using the PROKEY correction software). Business processes are controlled on the basis of received data. Through defined workflows, electronically archived invoices and their contents are now digitally available at short notice for the specialists of respective departments. One example of the resulting benefit is that the responsible person at the purchasing department can process the respective order of the materials management. The final stage of the fast data processing stands is the release of payment of invoice documents by the financial accounting system.  The central archive now holds the necessary data for any revisions or analytical reporting that may be required. Burgmann Industries used this new solution to control and automate following processing steps with already recognised data from the capturing process. Solution advantages: • Reorganisation of business processes relieves specialists from administrative tasks. • Increase of efficiency • Faster invoice processing • Paper reduced bureau and digital archive • Optimisation of data processing • Accelerated data access from different business processes Burgmann Industries has now a capturing portal at its disposal that corresponds to today’s and future requirements. Legal guidelines are maintained by revision safe, long-time archiving of scanned documents. Further automation of the invoice processes is possible and would further reduce manual tasks as well as personnel costs. Moreover, the solution can be used as basis for other applications e.g. integrating new requirements on the mail delivery.