Medical Protection Society
Purchasing solution cuts manual processing & increases efficiencies in AP
The Medical Protection Society Limited (MPS) is the leading provider of comprehensive professional indemnity and expert advice to doctors, dentists and health professionals around the world.
MPS was originally formed in 1892 and has over 265,000 members in more than 40 countries. Employing nearly 400 staff, MPS has offices in London, Leeds and Edinburgh. The main jurisdictions where MPS operates besides the UK are Ireland, South Africa, New Zealand, Hong Kong, Singapore, Malaysia, West Indies and Kenya.
MPS processes 40,000 invoices every year, 85% of which are for costs relating to managing member cases (e.g. solicitors' fees) and rarely have a purchase order. This means that Accounts Payable have to go through a strict authorisation procedure, involving file handlers (e.g. medical advisers), in order to ensure that invoices are properly authorised before payment.
Prior to PROACTIS, invoices would arrive in the Leeds office, or one of their other offices, and be distributed to the file handler for authorisation, bypassing the Finance department. This inefficient process meant that Accounts Payable were not even aware of the invoice until after it had been authorised and sent to Finance. This could take a substantial amount of time, which meant they had no visibility of commitments and lacked control over what were often high value invoices.
Suppliers would often call Accounts Payable to enquire about the status of their invoice, but with no visibility that these invoices had even entered the building or when they would be authorised, Accounts Payable were spending valuable time handling these queries and were not easily able to inform suppliers of when they would get paid.
The authorisation workflow for approving invoices in MPS is quite complicated and therefore time-consuming when conducted manually. They needed a solution that would move away from paper-based processes to a more streamlined, electronic approach that would be readily adopted by all staff.
Although the main driver for the project was to streamline invoicing processing in order to reduce time, costs and errors, MPS also wanted better control and visibility of other spending (e.g. admin, marketing costs) which a purchase ordering system would provide.
MPS looked at a number of spend control solutions on the market and PROACTIS stood out as a solution that would fit with how MPS operates. Christine Chadwick, Processing & Administration Manager at MPS explains: "Our business is quite unique in the way we work and we have to undertake a number of complex coding and authorisation processes before an invoice is paid. PROACTIS enables us to automate this, easily and efficiently."
MPS receives a disc from a supplier (e.g. law firm) with up to 20,000 individual lines of costs. In addition to the standard item fields (description, date, etc.) there is a unique identifier which when imported into PROACTIS, maps the item to the relevant MPS case and automatically codes the invoices.
Built-in authorisation workflows within PROACTIS use the unique case number to assign the invoice to the relevant file handler/s for authorisation. The system sends out an automatic email alert to the relevant handler which directs them straight into the system. With a few clicks, the invoice is authorised or rejected.
"Having a system that was easy to use was a key factor for us," explains Christine. "It was essential that the system had a good user interface. The kind of people that would be using the system - lawyers, doctors, dentists, etc. - are very busy people, so the last thing we wanted to do was provide a solution that would be complicated for them to use."
PROACTIS was first rolled-out on a department-by-department basis to manage the purchasing of indirect goods and services. The next step was automating the invoice processing and approval procedures.
"PROACTIS has been very well received by the whole organisation," says Christine."Change management was always going to be the most difficult part - convincing people that moving away from signing your name on a piece of paper to authorising electronically was the way forward. But once people started to use PROACTIS, they realised it was making their job easier and didn't detract from their other duties."
For employees that have to travel overseas, PROACTIS means there is no delay in invoice authorisation. Users can log on to the system anywhere in the world and access all the information they need to authorise an invoice.
In Accounts Payable, the visibility and control that PROACTIS has brought has really changed the way MPS works. By enabling suppliers to bill them electronically, MPS has reduced the manual input previously done by Accounts Payable by about 7,000 invoices per year and these efficiency savings will grow as they increase the number of suppliers that bill them electronically.
Christine comments: "PROACTIS has enabled our Accounts Payable team to focus on more value-added projects than was possible before, due to getting bogged down in endless mountains of paper."
And the benefits extend beyond increased efficiency. Invoices no longer get lost or misplaced, coding errors are reduced and fewer duplicate payments are made.
MPS's suppliers are also reaping benefits. "Previously, a supplier could have been waiting some time for a bill to get authorised but now it's brought in electronically, the turnaround time is much quicker so we're able to pay our suppliers sooner which fits comfortably with one of our core values of fairness" says Christine.
Even for suppliers that are not set up electronically, the new system is still much more efficient than the previous manual system. MPS scans the paper invoices into PROACTIS and most of the coding is done electronically using the unique case number. The file handler is notified and can view the invoice online.
Christine summarises: "We've shown you don't just have to use PROACTIS as it comes out of the box. PROACTIS Group has done an excellent job of understanding our business and configuring the product to meet our complex requirements. It is a wonderfully user-friendly system that has changed the way we work. I would recommend PROACTIS to anyone."