Leading Molecular Diagnostics Company Case Study

Role Filled

Interim AP Manager

Expert Operator

Amber Hunt

Project Detail

80% Time Reduction

Implemented Stampli, an AI-based AP system, reducing invoice processing time from 5 minutes to 1 minute per invoice

8-16 Hours Weekly Savings

With 30-50 invoices daily, achieved significant labor time savings for the AP team

$10,000 Annual Savings

Based on $25/hour AP temp rate, achieved substantial cost reduction through automation

Improved Vendor Management

Migrated 80% of critical vendors to ACH, reducing payment delivery time from 7+ days to ~3 days

Enhanced Cash Flow

Successfully negotiated extended payment terms from N30 to N45 with approximately 50 vendors, affecting $2-3 million in AP balance

Key Benefits & Lessons Learned

Team Strength Assessment is Critical:
In a high-volume environment, it's easy to think an "all hands on deck" approach is best, but if not everyone is strong in certain areas, it can slow progress, efficiency, and accuracy of more challenging tasks.

Task Delegation Based on Skill:
Designating tasks based on skill level helps improve efficiency and accuracy in complex accounting processes.

Resource Planning:
Recognizing when additional help is needed is important. Given the high invoice volume, the client needed more staff accountants to help manage the workload.

Solutions

Solution Outline:
The project implemented several key process improvements:

Segregation of duties within AP team: Assessed strengths of team members and designated month-end close tasks to more skilled accountants to improve efficiency, accuracy, and focus. Additionally, designated specific staff to continue processing invoices during close to reduce processing time and vendor issues.
ME close Accrual Checklist: Created a comprehensive month-end close accrual/JE checklist for the AP team to provide a record of recurring and non-recurring JEs, ensuring all necessary tasks were tracked each month rather than relying on memory.
Team Task Allocation: Emphasized that team members should ask management first when assistance was needed with accruals, reducing distractions for accountants focusing on their assigned tasks.

Client Challenges

AP team was not meeting month-end close deadlines for accruals and had issues with capturing significant expenses, causing under/over statement of expenses on a monthly basis
During month-end close, because everyone was working on accruals, there were no team members designated to continue entering invoices, causing a lag in invoice processing and resulting in past due issues in an already high-volume environment
These challenges contributed to the accounting team not meeting their ideal 10-day close deadline
The lack of efficiency caused inaccuracy in financial data due to under or over accruing expenses within a given month
Invoice processing delays caused past due issues to increase, impacting the operation of client lab sites due to threatening vendors on service shutdowns

Key Project Elements & Deliverables

Systems & Tools Used:
NetSuite for ERP, Blackline for Reconciliations, and Excel for financial analysis

Timeline:
2 months on project as interim AP manager until the client hired/promoted someone internally

Project Scope/Deliverables:

Serve as Interim AP Manager
Review and approve all JEs and weekly payment runs
Assist with process improvements and AP issue resolution
Provide variance analysis for month-end
Assist with audit request submissions
Help transition responsibilities to newly appointed Manager

Project Objectives & Business Needs

Key Project Objectives:

Implement Stampli to automate invoice processing and AP workflows
Clean up vendor payment profiles and transition key vendors from checks to ACH
Improve cash management by extending vendor payment terms and enhancing financial reporting
Increase AP process visibility through reporting dashboards and vendor self-service portals

Business Needs:

The client's AP function was inefficient, with unstructured processes and vendor payment delays
Better invoice automation and vendor payment management was needed
Cash flow management required improvement through optimized payment terms
AP staff needed better tools and processes to increase productivity

Project Outcomes

Improved ME Close Efficiency
Implemented structured process and team segregation to meet month-end close deadlines

Reduced Financial Reporting Errors
Increased accuracy in capturing estimated/actual accrual data, decreasing over/under statements of AP expenses

Enhanced Invoice Processing
Maintained ongoing invoice processing during month-end close to reduce payment delays

Team Optimization
Improved team morale and efficiency by aligning tasks with individual accountant strengths

Outcome Details

Milestones Achieved:

Completed all designated tasks as Manager
Assisted team in becoming more efficient through changes to team dynamics and responsibilities
Helped increase team morale by creating a collaborative environment and empowering staff
Successfully transitioned responsibilities to newly appointed Manager

Outcome Details:

Improved Efficiency: Team began to work more efficiently with clear task assignments based on individual strengths
Reduced Turnaround Time: Decreased time for completing accruals for review
Increased Accuracy: Improved accuracy in capturing estimated/actual accrual data, reducing financial reporting errors of over or under statement of expected AP expenses
Enhanced Team Performance: Improved team confidence and morale as accountants operated more in their strengths, growing in knowledge and experience, and receiving better feedback from upper management
Maintained Invoice Processing: Continued processing invoices during month-end close to prevent payment delays and vendor issues

How a Leading Molecular Diagnostics Company Improved Month-End Close Efficiency & Streamlined AP Operations Through Team Optimization

Quantifiable Outcome Summary

Reduced Time

10-Day Close

Enhanced Accuracy