What is Vendor Invoice Management?

1. About Vendor Invoice Management

VIM stands for SAP Invoice Management by Open Text and is a packaged business solution. Offering an SAP-centric solution, VIM acts as an add-on to your SAP system. It also uses SAP technology such as ABAP and Workflow. VIM is also integrated with standard SAP functions such as Invoice Verification and Financial Processing. It also provides customers with process efficiency, visibility and compliance values.Finally, it optimizes and simplifies the process of receiving, managing, monitoring and routing invoices, quotations, order confirmations, delivery notes, sales orders, remittance advices and related documentation on all levels.

After briefly mentioning VIM, we can now look at the components of VIM.

VIM consists of the following components:

Document Processing

-Capture invoice metadata

-Handle suspected duplicate invoices.

-Collaborate with others.

Invoice Approval

-List invoices to be approved.

-Approve and code the invoices.

Exception Handling (Invoice Exception)

-Handle the exceptions that arise after an SAP invoice is created.

VIM Analytics

-Overlook the invoices in progress in a unified dashboard.

Approval Portal

-Java based Approval Portal infrastructure running on SAP Web Application Server.

-Similar to Invoice Approval but with Web interface.

ICC (Invoice Capture Center)

-Automate the capture of paper invoices by using OCR to extract invoice data.

2. Understanding Vendor Invoice Management

2.1 Delivery model

As VIM is basically a scenario, its function may best be described as a problem solution. It enables the flexible configuration of a company’s payment workflow. To this end, VIM is delivered with a so-called Baseline Configuration, a set of pre-defined configurations that work out of the box. In conjunction with other Open Text products such as Livelink ECM – Archive Server it is possible to realize comprehensive solutions. Core Functions are the technical foundation of VIM: SAP screens, functions, workflow templates, web pages, etc.

2.2. Workflow scheme

Each VIM workflow process has the same basic steps.

These basic steps are ‘validate metadata’, ‘check duplicates’, ‘apply business rules’, and ‘post for payment’ in short.

Validate metadata

The metadata or index data are validated against the SAP database. If validation fails, an exception is triggered.

Check duplicates

The validated metadata is used to check whether the new invoice has been entered already. If the new invoice is suspected to be a duplicate of any existing invoice, an exception is triggered.

Apply business rules

Invoice pre-processing: Business rules are applied to detect additional exceptions before posting.

Post for payment

The invoice is posted and released for payment.

2.3 Process swimlanes

Business blue print sessions result in a set of finalized swimlane diagrams representing the to-be process. The workflow schema is an example of such a process swimlane that is delivered with the VIM Baseline Configuration.

3. How Vendor Invoice Management Works

Like every solution, VIM includes certain working processes. VIM optimizes&simplifies process of receiving, managing and monitoring invoices for responsible personnel and vendors.

We can list the way it works as follows:

  • The invoice comes via Email, fax or paper.
  • It is scanned first.
  • After that, it goes to the archive server where that invoice is automatically archived for documentation and that document is stored and identified by a unique 30-digit alphanumeric number.
  • This document is sent to and stored in SAP VIM and identified by a 12-digit hexadecimal number called the DP number.
  • It sends that document to the ICC server to extract the data in the invoice. Vendor number, currency, registration date, address, etc. After extracting all data such as from this document, it sends it back to SAP VIM.
  • For extraction of data on the invoice, it sends that document to the ICC server. Once it extracts whole data such as vendor number, currency, posting date, address etc., from that document it sends it back to SAP VIM.
  • When there are no exceptions, the invoice is sent via BAPI via MIRO.

It is the Early Archiving process where the first invoice is received, scanned and stored on the archive server, and then the DP number is generated. VIM uses the early archiving process. And archiving starts to generate the DP number for that document in parallel when the invoice comes to the Archive Server.

4. Benefits of VIM

Vendor Invoice Management includes communication with vendor, requests for additional information, manual routing, providing&monitoring update reports, among many resolution efforts. Let’s briefly touch on the benefits of VIM for development and continuation of business processes.

  • Minimize invoice processing time and optimize efficiency
  • Increases ROI and saves money
  • Reduced cycle times
  • Increased productivity
  • Cut costs, reduce manual data switching
  • Scalable foundation

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