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S ec t i on 3 : Compar i son to Pr i vat e S ec tor Prac t i ce s
Transportation Management in the Federal Government
| Best Practices Report: 2012
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AU TOMAT I ON F OR COS T S AV I NGS
Automation of business processes remains a hot issue within the private
sector.
American Shipper’s
2012 Transportation Payment Benchmark
Study shows many companies have begun adopting automation—or
plan to—for the payment process as well as increasing their use of
electronic payment forms like automated clearinghouses (ACH) and
other types of electronic banking.
Government agencies have access to some automation and electronic
services around payment through the GSA’s Center for Transportation
Management, but like the private sector the move to automation is
often slow.
For the private sector, automating freight payment has yielded signifi-
cant savings. On average, domestic costs were reduced from $14.17
to $5.07 for in-house systems, and down to $3.38 for an outsourced
process. A similar decline is true for international invoices, dropping
the processing cost by as much as $10.87.
Like their shipper counterparts, carriers made significant investments in
automation for parts of their freight pay cycle, but the two sides have
not yet met in the middle with an automated approach for dispute
resolution. Part of this is due to the fragmentation of freight payment.
For the private sector, there is no universal standard, which helps keep
this process considerably manual.
The private sector is approaching an electronic pay environment. The
progress may be slow; however, companies are seeing benefits from these
electronic systems, including better visibility of costs, cash flow
enhancement, and resolution. The government sector should see the
same benefits and more.