Achieving Efficiency with Single Instance of ERP

The move allowed Detroit utility DTE to spot and correct a massive problem with payments formatting.

For DTE Energy, the Detroit-based gas and electric utility holding company, the key to transforming itself from a low-tech shop bogged down with time-consuming manual processing and limited data access was moving everything to a single instance of SAP 5.0, its enterprise resource planning software. For DTE’s treasury, the switch meant use of SAP’s treasury, bank accounting, cash management and in-house bank modules.

Once the $8.9 billion company threw the switch, one thing that popped up was that the more than 9,000 electronic payments DTE makes each month to vendors on behalf of its 130 legal entities were in the wrong format 96% of the time. Moreover, 10% of the transactions could not go through without costly and time-consuming repairs. But a problem recognized is a problem that can be fixed, notes Keith Bardouche, supervisor of cash operations.

A conference call with a handful of bank experts on one end and treasury and IT experts at DTE on the other end identified the way to fix the formatting problems within DTE’s SAP system, and compliance shot up, Fiore reports. Now DTE has a 99.7% straight-through processing rate that ranks it among J.P. Morgan’s top performers and earned the company an award from the bank last January, Bardouche says.

With those glitches identified and fixed, DTE is riding its technology to much greater efficiency. Moving to one instance of SAP centralized a lot of things. There’s just one set of books, for example, so there’s no information to gather and collate for closing, and DTE can now close its books daily, Bardouche says.

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