ROI Case File No.352 | 'Global Invoice Solutions' Mountain of 400 Monthly Paper Invoices'

Chapter One: The Inefficiency of Paper Circulation—3 Days for a Single Approval

The day after resolving the ERP implementation case at Avalon Systems, another consultation arrived regarding invoice management efficiency. Volume 29, "The Pursuit of Reproducibility," Episode 352, tells the story of continuous improvement cycles.

"Detective, our invoice management is paper hell. We generate invoices from our sales management system, but the approval for customer delivery is done through paper circulation. All 400 monthly invoices are filed and stored on paper. The workload has reached its limit."

Mika Sato, the accounting manager from Global Invoice Solutions, born in Shinagawa, visited 221B Baker Street with an exhausted expression. In her hands were bundles of stamped invoices and, in stark contrast, a business analysis report noting "Average approval time: 2.8 days."

"We provide invoice management solutions for enterprises. Eighty employees. Annual revenue of 2.8 billion yen. Yet our own invoice management is inefficient."

Global Invoice Solutions' Current State: - Established: 2010 (Invoice management solutions) - Employees: 80 - Annual revenue: 2.8 billion yen - Monthly invoice issuance: Approximately 400 - Problems: Paper-based approval circulation, paper filing storage, insufficient integration with sales management system

Deep frustration permeated Sato's voice.

"The invoice issuance flow is as follows. First, we create invoice data in the sales management system. Next, we print the PDF. Then, we circulate the paper invoice to supervisors for approval stamps. After approval, we email it to customers. Finally, we file and store the paper invoice."

Problems in the Typical Invoice Issuance Flow:

Step 1: Invoice Data Creation (15 minutes) - Enter invoice details in sales management system - Verify amounts, quantities, unit prices

Step 2: PDF Printing (5 minutes) - Output PDF from sales management system - Print on printer

Step 3: Paper Circulation Approval (Average 2.8 days) - Accounting staff → Accounting manager → Business unit manager → Executive - Delays occur when any person is absent - Can take up to one week in extreme cases

Step 4: Customer Delivery (10 minutes) - After approval, attach PDF to email - Create subject line and body text

Step 5: Paper Filing (5 minutes) - File approved invoices by year and month - Storage space required: 6㎡ annually

Total Time Required: 2.8 days (including approval waiting time)

Sato sighed deeply.

"There are additional problems. The searchability of paper filing is poor. When customers ask us to resend an invoice from three months ago, it takes 15 minutes to locate it in the files. With 20 resend requests per month, we spend 300 minutes (5 hours) monthly on searches.

Furthermore, integration with the sales management system is insufficient. The system was custom-developed 2-3 years ago, but lacks functionality to manage invoice delivery status (sent/unsent). So we manage this separately in Excel."

Chapter Two: The One-Shot System Implementation—Improvement Doesn't End in One Round

"Ms. Sato, do you believe implementing an invoice management system will solve all your problems?"

Sato answered my question immediately.

"Yes, that's what we expect. The vendor told us 'Workflow functions will automate approvals' and 'Electronic filing will improve searchability.'"

Current Understanding (One-Shot Approach): - Expectation: One-time system implementation solves everything - Problem: No vision for post-implementation improvement process

I explained the importance of continuously cycling through planning, execution, checking, and improvement.

"The problem is the mindset of 'implement the system and we're done.' The PDCA Cycle—Plan, Do, Check, Act. Plan, execute, check, and improve. By continuously cycling through this process, you achieve continuous operational efficiency improvement."

⬜️ ChatGPT | Catalyst of Conception

"Don't aim for perfection in one shot. Start small and cycle. Continuous improvement through PDCA."

🟧 Claude | Story Alchemist

"Invoices always carry 'corporate trust.' Find a way to improve the flow without stopping it."

🟦 Gemini | Compass of Reason

"PDCA is the foundation of improvement. Don't end after one cycle. Accuracy increases through continuous cycling."

The three members began their analysis. Gemini displayed the "PDCA Cycle" on the whiteboard.

The 4 Steps of PDCA: 1. Plan: Goal setting and measure formulation 2. Do: Implementation based on plan 3. Check: Measurement and evaluation of implementation results 4. Act: Correction based on evaluation and progression to next cycle

"Ms. Sato, let's start with the plan for Cycle 1."

Chapter Three: Cycle 1—Starting Small

Phase 1: Plan (Planning, 2 weeks)

Goal Setting: - Reduce approval time from 2.8 days → 0.5 days - Eliminate paper filing, reduce search time from 15 minutes → 1 minute - Achieve integration with sales management system

KPI Setting: 1. Approval time: Within 0.5 days 2. Search time: Within 1 minute 3. Paper usage: 400 sheets/month → 0 sheets

Measure Formulation:

Measure 1: Workflow Function Implementation - Digitize invoice approval flow - Email notifications to approvers - Smartphone approval capability

Measure 2: Electronic Filing Function Implementation - Automatic storage of approved invoices - Full-text search functionality - Search by customer name, date, amount

Measure 3: API Integration with Sales Management System - Automatic import of invoice data - Automatic reflection of delivery status in sales management system

Implementation Scope: - Cycle 1 trials only in Sales Division 1 (100 invoices/month) - Company-wide rollout after effectiveness verification

Budget: - Initial development cost: 4.8 million yen - Monthly operation cost: 120,000 yen

Phase 2: Do (Execution, Months 1-2)

System Development (Month 1): - Build workflow functionality - Build electronic filing functionality - API integration with sales management system

Staff Training (Month 1): - 15 staff members from Sales Division 1 - Operation method training: 2 hours - Test operation: 1 week

Production Operation Start (Month 2): - Begin operation with 100 invoices/month in Sales Division 1

Phase 3: Check (Verification, Months 2-3)

Measurement Results After 2 Months:

KPI 1: Approval Time - Before: 2.8 days - After: 0.8 days - Goal (0.5 days) not achieved - Cause: Smartphone approval usage rate only 30%

KPI 2: Search Time - Before: 15 minutes - After: 2 minutes - Goal (1 minute) not achieved - Cause: Search keyword input rules not standardized

KPI 3: Paper Usage - Before: 100 sheets/month (Sales Division 1) - After: 8 sheets/month - Goal (0 sheets) not achieved - Cause: Some approvers still printing "just in case"

Staff Feedback: "The workflow function is convenient. However, the smartphone approval method is unclear. Also, when searching by customer name, sometimes nothing appears."

Phase 4: Act (Improvement, Month 3)

Improvement Measure 1: Promote Smartphone Approval - Video-based operation manual (3 minutes) - Individual briefing sessions for approvers - Target: Usage rate 30% → 80%

Improvement Measure 2: Standardize Search Keywords - Establish customer name input rules - Example: Don't omit "Corporation," use full-width katakana - Batch correction of past data

Improvement Measure 3: Suppress Paper Printing - Codify "no printing" rule - Explain significance of paperless transformation to executives

Chapter Four: Cycle 2—Company-wide Expansion of Improvements

Phase 5: Plan (Planning, Month 4)

Cycle 1 Results and Challenges: - Approval time: 2.8 days → 0.8 days (71% reduction, but goal not met) - Search time: 15 minutes → 2 minutes (87% reduction, but goal not met) - Paper usage: 100 sheets/month → 8 sheets (92% reduction, but goal not met)

Cycle 2 Goals: - Reflect Cycle 1 improvement measures - Company-wide expansion (400 invoices/month) - Reset KPI targets: - Approval time: Within 0.3 days - Search time: Within 30 seconds - Paper usage: 0 sheets

New Measures:

Measure 4: Add Approval Alert Function - Send reminder after 6 hours from approval request - Distribute approver workload (set proxy approvers)

Measure 5: AI-Enhanced Search Accuracy - Fuzzy search function ("Sony" also hits "Sony Corporation") - Automatic presentation of related documents

Phase 6: Do (Execution, Months 4-5)

Company-wide Expansion: - Expand to all 4 divisions (400 invoices/month) - Staff training: All 80 employees

System Modification: - Add approval alert function - Add AI search function - Additional development cost: 1.8 million yen

Phase 7: Check (Verification, Months 5-6)

Measurement Results After 6 Months (Company-wide):

KPI 1: Approval Time - Before: 2.8 days - After: 0.2 days - Goal achieved: Within 0.3 days (achievement rate 167%)

Approval Time Breakdown: - Accounting staff → Accounting manager: 2 hours - Accounting manager → Business unit manager: 2 hours - Business unit manager → Executive: 1 hour - Total: 5 hours (0.2 days)

KPI 2: Search Time - Before: 15 minutes - After: 20 seconds - Goal achieved: Within 30 seconds (achievement rate 150%)

KPI 3: Paper Usage - Before: 400 sheets/month - After: 0 sheets/month - Goal achieved: 0 sheets (achievement rate 100%)

Annual Impact (6 months operation, annualized):

Approval Time Reduction: - Before: 2.8 days/invoice × 400 invoices = 1,120 days/month - After: 0.2 days/invoice × 400 invoices = 80 days/month - Reduction: 1,040 days/month → 125 days/month (8-hour day conversion) - Personnel cost reduction: 125 days × 8 hours × 2,800 yen = 2.8 million yen/month - Annual reduction: 2.8 million yen × 12 months = 33.6 million yen/year

Search Time Reduction: - Before: 15 minutes/invoice × 20 invoices/month = 300 minutes (5 hours)/month - After: 20 seconds/invoice × 20 invoices/month = 6.7 minutes (0.1 hours)/month - Reduction: 4.9 hours/month - Personnel cost reduction: 4.9 hours × 2,800 yen = 13,720 yen/month - Annual reduction: 13,720 yen × 12 months = 168,000 yen/year

Paper Cost Reduction: - Before: 400 sheets/month × 10 yen/sheet = 4,000 yen/month - After: 0 yen/month - Annual reduction: 4,000 yen × 12 months = 48,000 yen/year

Storage Space Reduction: - Before: 6㎡ annually - After: 0㎡ - Reduction effect: 6㎡ × 20,000 yen/㎡/year = 120,000 yen/year

Total Annual Reduction Effect: - 33.6 million yen + 168,000 yen + 48,000 yen + 120,000 yen = 33.936 million yen/year

Investment Recovery: - Initial investment: 4.8 million yen + 1.8 million yen = 6.6 million yen - Monthly operation cost: 120,000 yen × 12 months = 1.44 million yen/year - Annual net effect: 33.936 million yen - 1.44 million yen = 32.496 million yen/year - ROI: (32.496 million yen - 6.6 million yen) / 6.6 million yen × 100 = 392% - Investment recovery period: 6.6 million yen ÷ 32.496 million yen = 0.2 years (2.4 months)

Phase 8: Act (Improvement, Month 6-)

Cycle 2 Results: - All KPI goals achieved - ROI 392%, investment recovery in 2.4 months

Improvement Proposals for Cycle 3:

Discovery of New Challenges: 1. Long response time for customer inquiries 2. Invoice corrections/reissues occurring 15 times/month (manual work) 3. Payment matching work is manual

Cycle 3 Plan:

Measure 6: Build Customer Portal Site - Customers can download invoices themselves - Expected to reduce inquiry volume

Measure 7: Automate Invoice Corrections - Handle minor corrections (amounts, addresses, etc.) immediately in system - Automate approval flow as well

Measure 8: Automate Payment Matching - Automatic import of payment data via bank API integration - AI-based automatic matching

Organizational Transformation:

Accounting Staff Member A's Voice: "Previously, waiting for invoice approval took 2-3 days. Sometimes customers would ask, 'Where's my invoice?' But now, approval completes in 5 hours. Also, searching for past invoices used to take 15 minutes, but now it's 20 seconds. Just enter the customer name in the search box."

Accounting Manager (Sato's) Voice: "Cycling through PDCA was the key to success. In Cycle 1, we didn't meet our goals. Approval time 0.8 days, search time 2 minutes. However, through Check we identified issues, and through Act we corrected them.

In Cycle 2, we achieved all KPIs. Approval time 0.2 days, search time 20 seconds, paper usage 0 sheets. We realized an annual reduction effect of 33.936 million yen and ROI of 392%.

And in Cycle 3, we're planning further improvements. PDCA never ends. Organizations evolve by continuing to cycle."

Chapter Five: The Detective's Diagnosis—Improvement Completes Through Continuous Cycling

That evening, I contemplated the essence of the PDCA Cycle.

Global Invoice Solutions had held a one-shot mindset: "implement the system and we're done." However, Cycle 1 didn't meet its goals.

By cycling through PDCA, they discovered issues through Check and corrected them through Act. Cycle 2 achieved all KPIs and realized 392% ROI. And improvement proposals for Cycle 3 emerged.

"Don't aim for perfection in one shot. Start small and cycle. Continue cycling through Plan, Do, Check, Act. Don't end after one cycle. Through continuous cycling, true improvement emerges."

The next case will surely depict another moment of continuous improvement cycling.

"Plan, Do, Check, Act. Plan, execute, verify, and improve. Don't end after one cycle. Through continuous cycling, organizations evolve."—From the Detective's Notes

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