Case Study: Southwest Airlines Implements Invoice Imaging to Tame an Out of Control Finance File Room

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Southwest Airlines has a reputation among its customers as being super friendly and very laid back. This cheerful attitude extends to the company’s vendors, who deal directly with their local Southwest office, rather than employees at the company’s Dallas headquarters. However, since invoices and other paperwork must eventually be processed at the main corporate office, and since Southwest is the largest carrier of domestic departures (read: a huge business despite their small town feel), there is a downside to their down home approach.

A mountain of paperwork, to the tune of a half million documents per year, comes through SWA’s accounts payable department. Until Blue Fish was called in to create a solution, these documents, sent in from all over, wound up filed as hard copies in an enigmatic fashion that left later tracking of pertinent information a labor-intensive, tedious process at best and, at worst, darn near next to impossible.

Initial assessment of the situation revealed numerous systemic problems. For example, if the Seattle office of Southwest Airlines needed a coffeemaker, rather than go through corporate, they could call the supplier directly. The supplier, in turn, would invoice the Seattle office, which would then okay the invoice and send it on to the finance department in Dallas, where someone would type it into the accounting system and issue a check to the vendor. Finally, the paperwork would be filed not by invoice date, but by the date it was processed in the Dallas office.

Whether trying to retrieve a misplaced or mistyped invoice, pull up a document for interdepartmental communication, or gather together a thousand invoices to satisfy a tax audit, accounts payable had their work cut out for them. These invoices could literally be anywhere among a thousand batches of paperwork stored in a huge file room. Even a simple search for a properly filed document could take up to a week to retrieve.

The financial pitfalls of this system were evident. The amount of time it took to find something translated to bottom line losses. There was also that absence-makes-the-fines-grow-bigger risk. When tax auditors on local, state, and federal levels demand comprehensive receipts, one missing record can cost plenty in penalties. A new, efficient system promised to make searches less of a nightmare while fulfilling every CFO’s dream: Get the auditor out of the building as soon as possible.

Blue Fish developed an end-to-end solution to handle input, storage, and retrieval of all A/P document images into an electronic filing system. The overhaul began with the one-two punch of a Captiva scanning/indexing system implemented along with a Documentum repository. Blue Fish then created an integration to synchronize the electronic image repository with SWA’s existing mainframe accounting software.

Now when paper invoices arrive, the AP staff scans the images and keys in a few pieces of pertinent information for each image. The images are then “married” with the associated accounting records in the mainframe using Blue Fish’s proven DIXI product. The marriage of these two systems allows AP staff and auditors to instantly access the original image of any AP document. Blue Fish also developed SWA’s custom browser-based AP image viewer and search interface.

Next, Blue Fish built a web-based search interface so anytime someone in accounts payable wants to search the database, they can enter a simple query, using basic information such as invoice number, amount, or actual invoice date (as opposed to process date). This was a crucial component of the solution, since document retrieval needed to be browser-based and user-friendly enough to give A/P and Tax Department personnel high confidence that all of their requested documents are returned. Blue Fish designed and built a custom WDK application that included search screens for several types of searches and a shopping cart to store search results for export to CD or bulk printing.

The solution has provided numerous benefits, saving both time and money. Now if a batch of invoices needs to be assembled for an audit, it can be easily retrieved, bundled together electronically and printed or exported in bulk form instead of being sought out in a piece-by-piece fashion and then sluggishly photocopied.

Electronic storage has also reduced the need for physical storage space. In the past, 17,000 hard copy documents were filed per month, and each was kept on premise for 13 months. Since images of all invoices are now maintained electronically, the paper originals can be destroyed sooner, instead of having to be stored in file rooms and costly off-site storage facilities. Once a predetermined amount of time has passed, the electronic files can simply be deleted.

Added security and standardization are additional benefits of the Blue Fish solution. Documentum’s built-in security features ensure that only authorized personnel can access images of invoices and other financial transactions. And as other departments at Southwest move towards electronic document management, they are able to leverage the existing Documentum infrastructure and more easily transition to standardized repositories.

“Blue Fish really streamlined our processing,” says Michelle Price, Accounts Payable Specialist. “Our workload has grown but we’ve been able to hold our headcount of employees steady because the system allows much more productivity.”

Speed is one area Price has seen major improvement. “Before image processing, once paper invoices were in house thirteen months we sent them away for storage. To retrieve them we’d have to turn in a request to the storage company, pay a fee, and wait a week. Now, from scanning a document to the end of its lifecycle we have access that ranges from instantaneous to two-minute pull time. It makes us really happy. We couldn’t imagine going back to paper storage.”

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