Archive for January, 2014

3 key steps to improve the way you track vendor invoices

For my job (Project Manager at MHPM Project Managers Inc.) I review a lot of high value invoices from various vendors (general contractors, architects, other consultants, and suppliers).

There is significant risk to any individual or organization that is involved in reviewing invoices as this directly affects the cash flow of other businesses and individuals. Below are the 3 key steps I have taken on my projects  to keep myself organized and protect myself, and my company.

Key step # 1: Have a single authoritative invoice log

The first key step is to have a single authoritative log for all the invoices indicating their status. Single means that these is a single location where the official log is stored and any copies are clearly marked as such. Authoritative means that it is 1) constantly updated to reflect the current situation and 2) trusted by all parties involved. To keep it up to date there likely needs to be an invoice log champion who will relentlessly seek to keep it up to date, and in many cases this will be you. To be trusted by everyone the log needs to show the honest truth (no fudging dates to make you look better!) and be available and understandable to others.

Example: I typically use an excel file uploaded to one of our MHPM’s SharePoint sites. Our SharePoint configuration enforces unique document numbers and version control which is a great help when there are copies floating around.  As our clients do not have direct access to our SharePoint sites,  I email them a PDF copy whenever there are significant updates to the invoice log.

Key step # 2: The log includes four categories of data: WHAT, IN, ACTION, and OUT

Log data category # 1: WHAT

What means what invoice are you tracking. The goal here is to have the bare minimum details required in your log so that if you are handed a random invoice you can look it up in your log to see if you have already logged it. I would err on tracking as little as possible and only adding in additional data if you run into problems. Every additional data point you track takes a few seconds to record and we don’t want to be wasting any time.

The bare minimum you will need to track in your WHAT section is the name of the vendor and their invoice number. If all of your vendors are relatively organized this is all you need.

If you are dealing with a less organized vendor, especially one that does clearly indicate if an invoice is the original or one of the potentially multiple revisions,  you will need to include some additional details to be able to distinguish between the invoices provided, and make sure you are not re-reviewing the same invoice twice.

After the vendor name and invoice number, the next best thing to add to your WHAT section is the total amount due. Most invoice revisions affect the amount due so if you have this in your log you can quickly see if you have a new invoice or just a copy of a previously submitted invoice. In addition, if you track the amount due you can use this information to help prioritize your efforts moving outstanding invoices forward. I do caution you to consider the size of the vendor in addition to the amount of the invoice, an individual billing you $5,000 is often much more important to pay quickly than a multinational supplier billing you $10,000.

If you are still not able to uniquely identify the invoices I would suggest slowly adding one of the following items at a time until you have reached your goal of seeing if a random invoice has already been logged.

  1. A written description of the invoice: This is kind of a catch all as you can put whatever you want here. You could describe the invoice error here and that way if you get a second copy of the wrong invoice you can quickly find your response
  2. The clients purchase order number: Often the problem with an invoice is that it references the wrong PO.
  3. The date on the invoice: This only works if the vendor updates the invoice date when they revise the invoice.
  4. The date the client received the invoice: this one is less useful if your vendor uses a shotgun approach (sending the invoice to multiple people) to getting invoices paid as there could be multiple receipt dates.
  5. The building/site/project the invoice is associated with: Only applicable if there are multiple building / sites / projects OR if the vendor is getting this wrong.

Log data category # 2: IN

IN means tracking when the invoice entered your queue. I usually just use a date, but you could specify a time of day if activity is frequent enough.

Example 1: If I came into the office an an invoice was on my desk or chair, I would input the date of the previous business day.

Example 2: If it was emailed to me I would input the date they sent the email.

Example 3: If I was handed the invoice I would enter today’s date.

The reason you want to be clear on this is so that you can accurately defend your progress and productivity. This doesn’t help the invoices get paid any faster but it helps protects you and your company from claims that you are delaying payment.  If someone else forgets to give you an invoice, this data will clearly indicate that it is not you who delayed payment.

Log data category #3: ACTION

A key part of the success of this system is to treat all of the un-approved invoices as a to-do list. You should be able to open the log, review this action section and know exactly what needs to be done to move the invoices forward. As with any good to-to list, these items should have a single responsible person, a deadline, and be the single next action required to move this forward.

Example 1: If I received an invoice that claimed that the work was 40% complete, and I needed my co-worker Leighton to verify this on site I would record in the action section: Leighton to confirm if work is 40% complete by Jan 22, 2014.

Example 2: If I received an invoice but the backup provided by the vendor was insufficient to verify that the product was delivered to our warehouse, I would record in the action section: [name of vendor contact] to provide documentation on quantity shipped by Jan 20, 2014.

Log data category #4: OUT

The final key aspect to this log is to clearly document when the invoice is “done”, but done doesn’t always mean paid, it could be rejected, and a new invoice will have to be submitted to re-start the entire process.

Key step # 3: Treat every invoice (including revisions) as a unique invoice.

The final key step to success of this system is to treat every single variation of an invoice as a unique invoice. If the vendor sends to two different invoices with the same number, input two rows, one per version. In all cases where you have multiple similar invoices, make a decision as to which one is more correct, and mark the other as rejected.

Closing

In all this may seem like a lot of work, but if my past experience is any indication, doing this will save you time in the end as you will be able to confidently respond to any invoicing issue.

If you are diligent in following up on the next actions frequently you could even accelerate payment to your vendors which will vastly improve your relationship with them.

How to save your ass by delaying your emails in Outlook

So I just about had a heart attack. I had drafted a confidential email and clicked send with the wrong person in the cc: line.

I’m sure you have done that before. What saved me is that I have a rule in my Outlook at defers all of my outgoing email by one minute. This way the email sits in my outbox waiting for me when I have a “oh crap” moment after lifting my finger from the mouse.

Here is how you can set up a similar rule on your computer:

  1. Open Outlook 2010.
  2. Click “Rules” > “Manage Rules and Alerts” (on the home tab, under the move section)
  3. Click “New Rule”
  4. Under “Start a Blank Rule” pick “Apply Rule on Messages I Send” and click next.
  5. On the “Which condition(s) do you want to check screen” just hit next.
  6. Click Yes to applying this rule to all messages you send.
  7. On the “What do you want to do with the message screen” under “Step 1” click the last option “Defer delivery by a number of minutes”
  8. Under “Step 2” click the blue “a number of” text, input 1 minute and click ok.
  9. Optional: On the next “Are there any exceptions” screen I would suggest selecting the 3rd option “except if it is marked important” clicking the blue text again, and choosing high importance. This will allow high importance (the red exclamation mark) emails to send immediately.
  10. Give the rule a name (Defer all mail by 1 minute?) and click finish.

That’s it! Send me a thank you email the first time this saves your ass.

How to find emails buried in public folders insanely fast

If you care about how long it takes you to find an email in your public folders, then this post is for you.  I like to think that people are impressed with my ability to quickly find project emails at work…

The simple setting change below tells Outlook to cache a copy of every single email in your public folder favorites on your hard drive which allows Windows search to index them all and allows you to search all of your emails from the start bar.

Requirements:

  1. Outlook 2010
  2. Windows Vista or newer
  3. Email stored in public folders

Steps:

  1. Open Outlook 2010.
  2. Click File > Account Settings > Account Settings > Data File Tab > Settings > Advanced Tab
  3. Check the box that says “Download Public Folder Favorites”
  4. Add any public folders you would like to search to your favorites.
  5. Wait for Outlook to sync a copy to your computer. A word of warning: this literally downloads every single message in your public folder favorites to your computer, so if your public folder favorites are 5 GB, it will download 5 GB to your computer. I recommend doing this from a wired connection at your office
  6. When Outlook is done, click start and type in your search in the “Search Programs and Files” search bar.

The most common search terms I use are From:(email), To:(email), and date:(date) but here is an article from Microsoft describing all of the search terms: http://windows.microsoft.com/en-ca/windows7/advanced-tips-for-searching-in-windows

Let me know if you impress anyone!