Murphy Company
Change Management Eases Murphy’s Transition to AP Automation with Job Costing
A DataServ client since 2023
Key Results:
- $100,000+ saved annually by repurposing FTEs who no longer manually process invoices
- 95% monthly AutoVouch™ success rate
- 20% increase in number of monthly PO invoices processed
- Nearly touchless workflow, with AP team now only working exceptions instead of every invoice
Key Stats:
- Invoice Volume: 110,000 annually
- ERPs: Penta
- Team size: Over 1,000 people
- Industry: Real Estate & Construction
Executive Summary
Murphy Company is a premier national contractor designing, constructing, and maintaining mechanical systems for the commercial, industrial, and institutional markets. After starting as a two-man plumbing shop in 1907, today Murphy Company employs over 300 salaried workers and 1,000 union craft workers in the pipefitter, boilermaker, plumber, sheet metal, HVAC, and laborer trades from its headquarters in St. Louis and regional offices in Illinois, Colorado, and Wyoming.
When Murphy came to DataServ, they knew they wanted to optimize their Accounts Payable (AP) employee experience and productivity. One of the biggest challenges for Murphy, and across the construction industry, is finding skilled professionals, especially in finance and accounts payable roles, who can manage the complex job costing process. Job costing refers to the tracking and allocating of expenses like materials, labor, equipment, and overhead for a construction project. It helps firms stay on budget, make smart decisions, and spot cost-saving opportunities. But keeping up with detailed tracking and constant updates can be difficult, especially when vendor and subcontractor invoices start piling up. Poorly managed invoices can throw off cost calculations, delay billing, and cause cash flow issues.
Construction job costing demands expertise in project accounting, a skill that’s often hard to come by. Even when you have someone with the right qualifications, they may end up spending a lot of time manually processing invoices and tracking costs, increasing the risk of errors and underutilizing their talents. At Murphy, too many employee hours were devoted to manually processing and routing invoices. They wanted a solution that would enable touchless workflows, while also enhancing visibility and providing real-time status updates and analytics. At the same time, they needed to scale their AP organization to support growth, new acquisitions, and increasing product and service complexity.
Before teaming up with DataServ, Murphy had invested in two prior AP projects in an attempt to automate their complex processes, but each system came with a higher price tag and less-than-optimal results. Due to these negative outcomes, Murphy was highly skeptical of any proposal for AP optimization that they investigated. They had also gained invaluable education and lived experience. After careful consideration, they ended up initializing DataServ’s QuickStart Solution, Single Sign On, and AutoVouch ™ to truly automate the matching process, which was taking too much of the AP team’s time.
Outcomes
DataServ understands that a crucial aspect of successful AP automation is change management and gaining employee buy-in. The Murphy purchasing team had some concerns about the potential for process disruption and payment delays after rolling out a new system at the start of the year. DataServ explained the rationale behind AP automation and the benefits it would bring to the organization. The DataServ team also addressed the purchasing team’s concerns and misconceptions up front and provided regular updates throughout the initialization process. DataServ provided comprehensive training programs to ensure everyone was equipped with the skills and knowledge they needed to use the new automated system effectively. Murphy, like every DataServ client, was also given ongoing support and resources to address any issues or challenges that may have arisen during the transition. While the Murphy purchasing team wasn’t involved in the initial decision-making process, they were encouraged to provide feedback and suggestions for improvement after the solution was initialized. By empowering even the most skeptical employees to take ownership of the automation initiative, this contributed to a culture of continuous improvement and innovation.
AutoVouch ™ reduced the job cost accounting burden on Murphy’s AP staff by automating invoice data capture and processing. DataServ’s automated 2-way matching system automatically matches every purchase order to the corresponding invoice. Now automated workflows route invoices to the right project managers or approvers via notifications, reminders, escalations, and out-of-office responses, allowing them to review and approve payments quickly. Whether they’re in the office or working remotely, nothing gets delayed. This allows Murphy’s talented AP team to focus on higher-value tasks like data analysis and reporting or strategic vendor relationship management.
Business Impact
After working through the initial change management issues, the entire Murphy team is thrilled with their AP job costing automation solution. Murphy Company is saving so many hours and resources because of the seamless automated processing that they can put FTEs in different roles and areas because they no longer need to manually process invoices anymore. This shift in staffing responsibilities is common among DataServ clients. The responsibility for approving invoices frequently moves away from AP after initializing the DataServ solution, because exceptions are routed to the necessary approvers without AP having to chase anyone down like they did before. According to Murphy, this has saved them hundreds of thousands of dollars, easily.
Looking ahead, DataServ is working on tailoring our AutoVouch ™ solution for subcontracting invoices so that Murphy Company and other clients who frequently use subcontractors can save even more time and resources. Contact us today to learn more about tailored AP solutions that could add value to your business.
Thoughts from Murphy
“The system is GREAT! The functionality is awesome, especially the search.”
- Rob Koester, CFO
“Before initialization, AutoVouch™ sounded too good to be true. After initialization, now I know it really works!”
- Sara Eder, Accounting Automation & Payables Lead
Let’s Start a Conversation
Regardless of where you are at in your AP automation journey, DataServ will meet you there and help you evolve.