Leading retailer MYDIN transforms accounts payable operations digitally
Retailer MYDIN leverages vendor invoice management (VIM) solutions for significant time savings and efficiencies by automating 95% of invoicing workflow.
With 78 retail stores, including malls and hypermarkets, convenience stores, franchised outlets, high-end groceries, a deli restaurant, and online shopping, MYDIN is Malaysia's household name.
As the retail environment becomes increasingly challenging due to domestic retail spending conditions and international competition, the company explored ways technology could help drive greater efficiency and reduce overhead to achieve better margins.
MYDIN gained more than initially anticipated after opting for the OpenText Vendor Invoice Management (VIM) system to address a specific requirement to digitise and lower the cost of its existing manual vendor invoice management process.
Manually heavy processes
Every day, the retailer receives around 2,000 invoices. And over half a million per year. These invoices were previously received at the stores and later couriered to their headquarters in Subang Jaya for processing. These invoices were manually sorted by payment dates and terms, then processed before being filed and stored. When there were queries about specific invoices, employees had to refer to this manual filing system. All these were processed by around 125 employees handing the invoices, inputting the data and managing the paperwork.
With the heavy reliance on manual input and multiple duplicate touchpoints, MYDIN understandably experienced many errors despite the attentive nature of their skilled finance professionals. The work was also mundane for skilled professionals and costly for the business.
Escalating resourcesAs MYDIN plans to keep growing, this issue was only going to balloon. They would eventually run out of space to store the paper records. On top of that, its head of finance estimated they would need seven new employees to manage the invoices for every new hypermarket.
Utilizing the right solution
MYDIN reviewed the Accounts Payable automation solutions available. As an SAP customer, it sought to find a truly integrated solution that would transform the process from end-to-end. They identified OpenText, a long-standing SAP partner, which offered an integrated and unique solution, OpenText Vendor Invoice Management (VIM) for SAP and OpenText Invoice Capture Center (ICC). For the solution implementation, MYDIN leveraged trusted OpenText implementation partner, delaware. The project completed in 11 months, leading to a complete end-to-end digital approach to invoice processing.
Automated Data Extraction
OpenText VIM has enabled MYDIN to quickly process vendor invoices, efficiently and efficiently, and enhance worker productivity, cash flow, and vendor relations. The solution optimises and simplifies managing, receiving, routing and monitoring of invoices and its related documentation.
Many of MYDIN’s suppliers do not transact electronically. It had driven the implementation of the ICC solution to automate manual invoice capture. Invoices received in hardcopy or as a PDF attached to an email, benefitted from the ICC solution where the deep integration into SAP fully automates the data extraction and eliminates manual data entry.
95% reduction in errors
The reinvented process now does not require any human intervention unless there is an issue with an invoice. The solution auto-matches at least 95% of the invoices received, significantly reducing the number of errors during the process.
Higher Staff RetentionMYDIN managed to reduce the number of staff required to manage invoice by 50%. It has even improved staff retention. The retailer now have trained accountants doing high-value work instead of mundane administrative processing tasks. It is a more efficient use of their time, keeping they more engaged.
The company now has full visibility into all invoices' status. This resulted in a vastly simplified process when responding to queries —compared to the previous system of manually retrieving the individual paper invoice from within the physical archival files.
Improved supplier relationship
Approval of invoices is now almost immediate, compared to previously handled four times before being accepted for payment. This led to an opportunity for MYDIN, which is looking to leverage discounts from its suppliers for fast invoice payments turnaround. By being among the first to digitalise, MYDIN transformed its supplier relationship management chain and encouraged its ecosystem to adapt by offering favourable terms to those who transact with them digitally.
Invaluable time savings
"The time savings we’ve gained is invaluable for our business. Across our 78 stores, our store managers used to spend about an hour a day acknowledging invoices. This equates to over 36,000 staff hours annually given back to our managers. The time savings will enable them to focus on the front-end customer experience, which is crucial in the retail business.” Malik Murad Ali, IT director at MYDIN
As MYDIN continues to expand, the VIM solution can be scaled easily without hiring extra financial resources.
"While we are an established and mature brand, we still foster a top-down innovative culture. This approach keeps us competitive and growing, even in tough retail conditions. Working with delaware and OpenText have delivered outcomes even more impactful than we have originally anticipated, enabling us to stay ahead and discover for new ways to disrupt our processes for continued success"
Malik Murad Ali, IT director at MYDIN