In the PayStream Advisor webinar last week, we heard an amazing story on AP and P2P transformation from Debbie Rich-Walker, the Senior Finance Manager at the world’s largest home improvement retailer, Home Depot. Ms. Rich-Walker, who will also be a speaker at our Innovate 2014 P2P Summit this September, is a natural and dynamic leader, and with her guidance, Home Depot became a transformative player in the P2P world. In the webinar, Ms. Rich-Walker was joined by PayStream’s Henry Ijams and Direct Commerce Founder and President, Bruce Hanavan, and together they showed us the power of innovative and driven collaboration. We are happy to share the Home Depot Value Creation Story again with you today.

Although the results have been tremendous, Ms. Rich-Walker admits the change to complete automated processing was a difficult and sometimes exhausting journey. Home Depot is an enormous company with 40 million AP transactions and $50 million in direct spend a year. For such a big operation, it was difficult to drive change, but the intense pains of the company’s manual methods far outweighed the effort of transition. In Home Depot’s old paper-process, discrepancies included problems with cycles, suppliers sending duplicate flyers and consequential duplicate payments. They processed over 5 million pieces of paper a year, and while invoices made up a big part of that paper volume, a large amount was also being used in conflict resolution. With an enormous number of supplier calls to the department’s help desk, Ms. Rich-Walker’s staff was spending most of their time smoothing over problems in their supplier relationships.

Home Depot took charge of their messy situation by partnering with the solution provider, Direct Commerce. They began their automation journey with a self-service portal where Home Depot vendors could file issues and complaints. This portal turned out to be the game changer, and the foundation of Home Depot’s Value Creation Story. Ms. Rich-Walker said that the portal’s initial purpose was to be a dispute management center to relieve the pressure from her staff, but once they recognized its value, they rebranded it as a supplier self-service center, turning it into a one-stop shop for their vendors. It phased out Home Depot’s help-desk, eliminating the constant calls and time needed to handle problems. Additionally, the portal enables Home Depot to track the process of invoices and other documents, record suppliers’ concerns, and manage cash effectively. Today, the company spends 40% less on their processing costs, and they can now gain capital through early payments discount. With such a huge organization, a 40% cost reduction means millions of dollars in savings.

Concerning his work with Ms. Rich-Walker, Bruce Hanavon said she was a real front-runner in the transformation process. Direct Commerce collaborated with Home Depot to create the right program criteria that would build success early on, and Ms. Rich-Walker took advantage of all Direct Commerce had to offer by leveraging the self-service portal as an enabler for additional process improvements—which really gave them their business leap. When customizing the solution, the AP and procurement departments partnered with treasury staff to support an optimized financial strategy that increased savings, making their process a treasury creation instead of simply an AP creation, and when making the transition, Ms. Rich-Walker’s department surveyed their suppliers to get their feedback. Ms. Rich-Walker believes the company was successful in implementation because they involved the supplier in this way, making the self-service portal collaborative and personal from the ground up.

The complete transition took Home Depot five years to complete, but they made it through the rougher patches by maintaining goals and objectives—a critical practice for driving success—and by remaining flexible. Each step they took brought astronomical ROIs, as well as fantastic supplier relationships, and today they have reached what seems like an impossible goal: a 100% paper-less process. Ms. Rich-Walker wants AP and financial professionals to know that this goal—the holy grail of automation—is possible and maintainable with the right sustainability practices. These practices include finding the right people, the right process, and the right technology.

Ms. Rich-Walker will be joining PayStream for our annual conference, Innovate 2014 Purchase to Pay Summit, held in San Antonia, Texas, this September at the Hyatt Regency Riverwalk. This exciting conference will feature 18 case study workshops facilitated by leaders—like Debbie Rich-Walker—at the most innovative organizations. This is a great opportunity for finance professionals to learn more about process improvements, and to network with their peers in AP, Procurement, Finance, and the Supply Chain. Join us in September—we would love to see you!