Accounts Payable Rework Reduction Project
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- This topic has 6 replies, 4 voices, and was last updated 13 years, 11 months ago by
Chris Wheeldon.
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July 29, 2008 at 12:38 am #24781
juadamsParticipant@juadamsInclude @juadams in your post and this person will
be notified via email.I am working on a project in Accounts Payable where the goal is for them to touch every invoice once – basically an invoice arrives, they process it and then pay it.
I have pareto’ed the reasons for rework and top reason is the purchasers are not closing out the Purchase Orders when the work is complete or the service has been delivered. So the invoice arrives at AP and they go into the system and the PO has not been received. AP can’t pay it because they don’t know whether the work has been done or not. In most cases the work has been done and the purchaser just forgot to go into the system and close out the order.
Any ideas on how to get past this one? It is a human error thing and I don’t know what type of solution to put into place to make people not forget!0July 29, 2008 at 3:38 pm #59406
Adam BowdenParticipant@Adam-BowdenInclude @Adam-Bowden in your post and this person will
be notified via email.Go to the head of purchasing – provide a list of people not closing
out the PO’s – get the head of Purchasing to “re-align” expectations
with a big stick.Adam0July 29, 2008 at 4:20 pm #59408
juadamsParticipant@juadamsInclude @juadams in your post and this person will
be notified via email.Hahah – that is our current process if you could believe it! It works for about 2 weeks and then people slide back to their old ways – hence the need for the project!
0July 29, 2008 at 5:04 pm #59409
Adam BowdenParticipant@Adam-BowdenInclude @Adam-Bowden in your post and this person will
be notified via email.AP groups love a 6 foot by 4 foot white board with some nice
metrics on their performance – with the offending names on a very
large pareto. In Denver there is a road called Colfax road where
the “ladies of the night” hang out – the police started posting
pictures of people using their service in the local paper – it made
an impact for sure and posting the right metrics in the AP area will
also drive the right long term behavior provided the
Leader/Manager has the ability to keep on top of it.Adam :^)0August 6, 2008 at 10:22 am #59418
Shaun WainwrightMember@Shaun-WainwrightInclude @Shaun-Wainwright in your post and this person will
be notified via email.I agree, the white boards or large displays works a treat, however, it doesn’t keep the mind focused all the time. My last company had individual performance contracts (IPC) that were used to track the performance of staff. These IPC’s were used for a number of things, such as evidence of development and promotion potential, but more importantly, their bonus. We linked the measurements from the project in the area and the human error rates to the IPC’s and… No-one lost sight or slipped back into their old ways…. In fact it created a culture of what can we do differently to maintain quality by increaseing performance (and in turn bonus!)…
0August 6, 2008 at 4:23 pm #59419
Adam BowdenParticipant@Adam-BowdenInclude @Adam-Bowden in your post and this person will
be notified via email.I agree — I have seen the same also.Adam
0August 7, 2008 at 2:53 am #59420
Chris WheeldonParticipant@Chris-WheeldonInclude @Chris-Wheeldon in your post and this person will
be notified via email.It sounds like your overall process needs some re-work. Purchasers should not be able to “forget” to go into the system – it should either be simple and routine enough that it occurs as part of their regular activities, or you need to have it triggered by another dept, such as AP asking the requisitioner to verify that the work is completed. The problem with relying on the requisitioners to close out the order is that they aren’t interested in having the order closed – they just wanted the work done (which they’ve got, right?). You can beat on them all you like but they’re listening to station WIIFM, not you and not AP. So – what is in it for them, anyway?
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