SAP Cash Application - your questions answered

13 June 2018

Brenton O'Callaghan

Brenton O'Callaghan

Global Head of SAP Leonardo
At SAPPHIRE NOW 2018, SAP had a clear focus on their Cash Application powered by SAP Leonardo and I’ve received several questions from customers this week around the solution. How does it work and how do you get started? In this post I’m going to cover some of the main questions I’ve received and hopefully shed a little bit of light on this really cool solution.
 

Why is the SAP Cash Application relevant?

SAP Leonardo is focused on creating user-led solutions that will move the needle within the business...SAP’s Cash Application is a great example. It is focused on the invoice and payment matching process which typically has a 30% to 70% manual versus auto clearing rate. What if that statistic was reversed and imagine how much time that would free up! The application is designed to focus on reducing the days sales outstanding (DSO) metric which brings instant and measurable business benefit.


What is the SAP Cash Application?

The SAP Cash Application is a cloud-based extension for SAP (an API) that provides machine learning based intelligence for your invoice and payment matching process. The algorithm uses previous manual matchings to inform its decisions on future payments. It integrates into your existing clearing system and utilizes the Cash Application APIs in the SAP Cloud Platform on a batch basis.
 

How does it work?

Once configured, your ERP system will periodically call out to the SAP Cash Application APIs based on the SAP Cloud Platform to process that day’s payments against outstanding invoices. The machine learning model is trained by historical data from your systems and will use that information to match the correct invoices to payments.


Manual payment matching screen showing Machine Learning based suggestions from the algorithm. Credit: SAP.

For any payments that are not automatically matched to invoices they will be flagged for manual intervention. However, the algorithm will add true value by suggesting potential invoice matches for consideration by the manual processor.
 

Are there requirements for adoption?

Naturally this won’t work with all versions of ECC and the requirements are changing constantly but as a general rule of thumb:
  • S/4HANA Cloud - version 1802 and above
  • S/4HANA on-premise - version 1709 and above
  • ECC 6.0 - Ehp7 and above (however not all features are available for legacy ECC systems).
Once you have an applicable installation, you simply require some minor configuration and a license to use the SAP Cash Application APIs in the cloud.
 

Where can I get more information?

Reach out to me or to any of the team at Bluefin for more information and we’d be more than happy to discuss in more detail. SAP have provided a great overview video which you can watch here.The SAP Cash Application is one of those all-round applicable SAP Leonardo solutions that everybody can relate to and can create serious excitement within the business through obvious and measurable benefits.
 
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About the author

Brenton O'Callaghan

Global Head of SAP Leonardo

Enterprise technology consultant & emerging technology evangelist

To date I've focussed on emerging technologies in the SAP space from in-memory with SAP HANA since 2011 to SAP Leonardo released in 2017.  I've led award winning projects using these technologies including one of the first SAP Fiori implementations globally for Bluefin.

All of my focus currently is on introducing my Fortune 250 clients to the SAP Leonardo Innovation process, helping them kick-start a program of digital innovation using the SAP Cloud Platform.  I also work closely with SAP's Leonardo and HANA product teams to help them develop roadmaps and bring customer feedback closer to these products.

Outside of work you'll likely find me kicking back with a Guinness or watching some sort of sport (either Munster Rugby or the Red Sox).