How did DB SCHENKER Ace The Cash Application Game Using Automation

About DB Schenker

DB Schenker is a logistics company with about 1,640 crores EUR annual revenue and 72000 employees worldwide. It has expanded to over 2000 locations globally with over 750 warehouses. DB Schenker has become global leaders in its 140 years of inception but even the largest machine can hit a bit of a snag sometimes. For DB Schenker, this came in the form of their Cash Application system. Let’s look at how Cash Application at DB Schenker was being dragged back.

Cash Application scenario at DB Schenker

DB Schenker had a primarily manual cash posting method. Six of their employees had to manually post cash to SAP which was not only time-consuming but also error-prone. They also had to maintain the ERP database (which was huge considering the size of the company) and cope up with journal entry daily. They had no lockbox, due to which checks were mailed to branches and manually deposited to the bank each day. All the above-mentioned problems raised a few challenges that were turning into a hindrance for DB Schenker and were holding back the dreams of global expansion.

Challenges faced by DB Schenker

The labor-intensive Cash Application processes which were in use at DB Schenker were snowballing into obstacles and major challenges. These challenges were:-

Two Simultaneous Projects: Running and handling multiple projects simultaneously was one of the greatest challenges.

Lockbox: Setting up new lockboxes for every new customer was very taxing.

Email Remittances: Accessing Email remittances was tough without any centralized system, which led to added manual work.

Billing: Updating the lockbox and centralized email with payment remittance instruction caused a lot of futile labor.

Transport Management Systems: Implementing countermeasures to the challenges faced needed a lot of technical and IT support.

Customer Information: Gathering customer information from limited data was difficult.

To tackle and nullify these challenges, DB Schenker needed to change its traditional system of operations. Changing the system required a makeover of all the processes involved in it from ground zero. To be able to achieve this, they needed to choose the right vendor.

Evaluation of the right vendor

To move forward with automation, DB Schenker needed a vendor who not only understood the requirements but also provided a concise solution. They were looking for a vendor who could-

Integrate seamlessly to SAP.

Handle remittances of different formats coming from different sources.

Apply EBS(Electronic bank statement) with cash application.

Send email notifications of acknowledgments.

DB Schenker after careful evaluation chose HighRadius as their vendor who would lead them into the automation era.

Automation Implementation with HighRadius

HighRadius with its automated Cash Application solutions revamped the previous obsolete system. The Cash Application team came up with a new, clearer and much more concise Cash Application processes which enabled DB Schenker to expand much more flexibly. This enabled DB Schenker to:-

Run multiple projects at the same time successfully.

Maintain Cash Application and SAP simultaneously.

Provide adequate training and documentation.

Complete all the required processes before going live. Along with these advantages, automation also came with some unique perks which made it crucial in the expansion.

Unique features unlocked after Automation

After automation, it provided 3 features that were crucial to complete the transition. They were:-

Streamlining and automating Electronic bank statements (EBS) & cash application process.

Coming up with a cash application solution that could handle checks, ACH & wire remittances.

Connecting HighRadius and SAP directly using standard interface protocols.

The collaboration with HighRadius led to the Cash Application systems of DB Schenker moving forward by leaps and bounds. Cash Application was not a labor-intensive and error-prone process anymore.

Automation-the perfect fit

Automation made cash posting easier and less labor-intensive. Along with that, automation was also able to:-

Use the EBS files to identify the ACH remittances.

Provide expertise in setting up SAP lockbox and integration of the EBS.

Present cash application rules which are configurable based on business requirements.

Adapt to the timeline of deliverables and time constraints.

It is widely believed that automation is difficult to implement. A poor Cash Application system can cripple the funds of a company slowly. Besides leaving a negative impact on the customer experience, it is also very resource depleting. Therefore the call for a newer and scalable solution is at its peak.
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