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3–20 Link Supplier Requests to the Accounts Payable Database
and the check numbers that were issued. For a company that is seriously delin-
quent in its payments, this can be a full-time job for the accounting staff, which is
also a clear loss of productive time.
A recent innovation that largely eliminates verbal responses to suppliers is to
have suppliers call a phone number that links them to a keypad-activated inquiry
system that will answer their most common questions. For example, they can
enter the company’s purchase order number, their invoice number, or the sup-
plier’s name; the system will then respond with the specific payments made, the
date on which the check was cut, and the check number. The system can even be
extended to list the date on which payments are scheduled to be made.
However, there are some issues to consider before installing an automated
supplier response system. One issue is that this is a very recent innovation and
most suppliers will not be used to it—they want to talk to a person and will del-
uge the company’s operator to voice this opinion. To quell this type of response,
the system should include an option to exit the automated system and contact a
person. This allows the more technologically versed suppliers to use the auto-
mated system, while other users can still talk to a person. This option is also nec-
essary for those cases where there are unusual circumstances. For example, a
company may not be paying due to a lack of receiving documentation, or because
the quantity billed was incorrect; it is better to discuss these problems with a per-
son instead of a computer, since special actions may need to be taken to resolve
the situation. The other problem is the cost of the installation. It requires an inter-
face computer that links to the main accounting computer system, as well as
modem access and software, to translate supplier requests into inquiries that the
accounting database can answer. These costs can be considerable, especially
when there are expected to be many callers and many requests for information.
The price range typically starts at $20,000 for the smallest installations and can
be many times higher for large systems. Nonetheless, this is a good approach for
companies that feel they can bring about a major efficiency improvement by rout-
ing suppliers straight to the accounts payable database for information.
An alternative to having suppliers access accounts payable information
through a phone connection is to do so through an Internet site. This approach is
somewhat more flexible than a voice-activated system that is generally limited to
a few simple status messages. Instead, a Web page can itemize the exact status of
each payable item, assign a code to it that explains the reasons for any delays, and
note the name of the contact person in the accounts payable department who is
responsible for processing the supplier invoice. It can also list any missing infor-
mation that is delaying payment, such as a purchase order number or bank
account number for the supplier, which can be entered by the supplier directly into
the Web site, and which will be automatically loaded into the accounting database
to assist in the completion of processing. The Web page may even list the name of
the person who is responsible for approving the invoice, as well as this person’s
contact information. A company may not want to add this last piece of informa-
tion, since it can greatly increase the volume of phone calls to these people, who