Imagine that you’re a member of a cooperative that works with more than 2,100 suppliers to help you deliver your product to local and global customers. In this case, your product happens to be beet sugar used as an ingredient in your customers’ food and beverage, confectionery, and other businesses.
Part of the ‘beet’ generation
You’re a member of the Western Sugar Cooperative. A 100+-year-old, Denver, Colorado-based organization, the cooperative includes fourth- and fifth-generation beet growers, with sugar-producing facilities in all 50 US states. Today, America is the second largest grower of sugar beets behind Russia. According to the Institute of Agriculture and Natural Resources: “Of the current world production of more than 130 million metric tons of sugar, about 35% comes from sugar beet and 65% from sugar cane. In the USA, about 50-55% of the domestic production of about 8.4 million metric tons derives from sugar beet.”
Not all sweetness at first
Because of an ever-increasing volume of supplier invoices and payments made to those suppliers, coupled with the cooperative’s legacy accounts payable (AP) solution, the cooperative was facing workload and processing challenges that could affect its business and that of its suppliers.
Suppliers were often hand-delivering paper invoices to the cooperative’s local offices, which were processed and paid out manually with no centralized invoice management. The legacy solution did not have exception/error detection reporting capability, and there was no visibility into backlogs or operations across the facilities.
As a result, the work was extremely time-consuming, and the decentralized, manual processing opened the door to errors. That could lead to late and inaccurate payments, impacting suppliers’ ability to meet their obligations to their employees, suppliers, and the cooperative.
Overcoming the challenges
Cooperative leaders wanted an end-to-end, automated solution. It needed to handle a variety of tasks such as invoice capture, data extraction and validation, verifications workflow and approvals, exception and error handling, and reporting and analytics to boost the visibility, control, and predictability of the cooperative’s invoice management.
Working with SAP, the cooperative picked SAP Ariba Central Invoice Management with its inbound process for SAP S/4HANA Cloud public edition to create just what was needed. With the SAP platform, Western Sugar has streamlined and accelerated the invoice management process, from invoice capture to payment.
“Centralizing accounts payable on the one SAP platform has made it possible to consolidate the payable process,” says Richard Caluori, Director of Corporate Controlling at Western Sugar Cooperative. “This capability enables our managers to track, manage, and pay invoices across different plants. This is a huge advantage.”
Sweetening the solution with SAP
The cooperative has been able to manage inbound invoices seamlessly, viewing those documents from different suppliers, across all channels and locations, with one simple work list. It has boosted visibility and control on the status of invoices to be tracked throughout the invoice management process so that nothing falls between the cracks. The Western Sugar/SAP solution has also helped the cooperative improve data security and privacy to ensure compliance with local and global data protection regulations.
By automating the invoice task with artificial intelligence (AI), Western Sugar has been able to reduce costs and time related to manual data entry, paper-based processing, and error corrections. The cooperative has:
- Saved 33 hours of processing time each month
- Realized 25% cost savings
- Increased operational efficiency, processing approximately 2,000 invoices each month
Those improvements and others have helped reduce payment delays, enhance supplier relationships, and boost the job satisfaction of cooperative employees. “The SAP solution allows us to give back approximately four workdays per month to our accounts payable people to address more strategic activities,” says Tom Hanson, Accounts Payable Manager at Western Sugar Cooperative.
Sweet recognition
The improvements have also led to Western Sugar being recognized as an innovator and leader in its industry. Recently, the cooperative was named a finalist in the SAP Innovation Awards 2024. Learn more about Western Sugar’s success in its pitch deck.
