Deutsche Telekom + Celonis

€40M annual savings through cash discounts

Celonis helped Deutsche Telekom Services Europe save over €66M by maximizing the improvement opportunities of their Procure-to-Pay process to tackle duplicate payments and cash discount losses.

Success isn’t a goal or destination. It’s a journey.

For Deutsche Telekom Services Europe (DTSE), a subsidiary of Deutsche Telekom, success means providing innovative, high-quality, end-to-end shared services across the company.

The Shared Services Center combines the Finance, Reporting, Procurement and HR functions to deliver a highly digitized Procure-to Pay process for the entire Deutsche Telekom group. They handle everything from negotiations over requests and order management to invoicing and payment. That way, other departments can focus on their core business.

According to Peter Tasev, Senior VP of Procure-to-Pay at DTSE, the structure is quite innovative. “Having Procurement and Accounts Payable under one roof is not very common, or at least not as common as it should be,” Tasev said.

Digitalizing the end-to-end value chain — from purchase requisition in Procurement to checking payment status in AP — is a mammoth task that requires not only the right mindset but the right technology, too.

“We wanted everybody to work with the same standardized structures, processes, and data,” says Tasev.

Proactively intervening before any problems

DTSE’s Procure-to-Pay process handles over 2M order items — with an order volume of more than €7B — and processes almost 9M invoices a year. It needs to run like a well-oiled machine. The slightest hiccup in their value chain could mean millions of dollars in losses.

One of the main challenges Peter Tasev and his team faced was to leverage the vast amount of data generated every day in the Shared Services Center to eliminate problems and inefficiencies. Though they had successfully digitalized all of their core processes and were aware of some pain points, DTSE struggled to zero in on the root causes of these problems and, by extension, act on them.

• Duplicate payments to vendors led to high cash losses.
• Blocked payments prevented them from maximizing cash discounts.
• Suboptimal delivery date accuracy caused harsh penalties.
• Employees wasted time on low-value transactional tasks.
• Discussions, and ultimately business decisions, were based on subjective experiences, not numbers.

That’s why DTSE turned to Celonis.

Scaling up data analytics with the Celonis

By connecting data from more than 10 source systems, including SAP Ariba and Salesforce, to the Celonis Process Intelligence Platform, DTSE gained unprecedented visibility into their process flows.

“I was astonished when I saw what Celonis could do for the very first time. There is simply nothing comparable on the market,” said Tasev.

“Once we had everything set up, we had this ‘Wow’ moment. For the first time, we saw our processes as they really are and could directly point out inefficiencies.”

Peter Tasev

SVP Procure-to-Pay,

Deutsche Telekom Services Europe

Armed with an always up-to-date knowledge of how their processes actually run, DTSE could now not only define new KPIs, but also develop an early warning system for the KPIs going off-track.

“Celonis is a game changer,” adds Christian Unterbusch, VP of Operational and Strategic Steering for Procure-to-Pay at DTSE. “By using process mining, we established a fully data-driven organization within the Procure-to-Pay area.” This was a goal that the Shared Services Center had been pursuing for almost a decade.

1. Maximizing cash discounts: Real-time reports with open blocked invoices helped DTSE achieve a cash discount rate of 96% and led to additional savings of a staggering€40M per year.
2. Paying on time: Celonis automatically prioritizes invoices to drive on-time payments. With the help of real-time alerts and automated process steps, DTSE reached an on-time payment rate of over 90%.
3. Increasing automation: DTSE increased their no-touch rate significantly, which freed up capacity for tactical sourcing and resulted in savings of € 12M. More efficient processes mean DTSE’s Purchase Orders are now right the first time, over 90% of the time.
4. Avoiding duplicate payments: DTSE also established a real-time analysis for duplicate payments. By leveraging Celonis to compare all outgoing payments and flag duplicate payments to employees, DTSE has saved €3M — and blocked any future duplicate payments, too.
5. Enforcing contractual penalties: DTSE also systematically analyzes contracts for contractual penalty options. As a result, they received approximately €1.6M in penalties in 2019 alone.

“Our internal customers at Deutsche Telekom benefit tremendously from using Celonis,” said Unterbusch. “Employees who were doing low-value transactional tasks in the past, now have the time to select suppliers or negotiate better payment terms. This helps our teams achieve millions in savings throughout the year.”