Texas Industries, Inc. Centralizes and Automates Payables, Increases Productivity 80%
 
 

Texas Industries, Inc. Centralizes and Automates Payables, Increases Productivity 80%

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Texas Industries, Inc. (TXI) is a leading supplier of cement, aggregate, and consumer product building materials for residential, commercial, and public works projects. With operating subsidiaries in six states, TXI is the largest producer of cement in Texas and a major producer in California. TXI is a major supplier of stone, sand, gravel, and expanded shale and clay products, and one of the largest producers of bagged cement and concrete products in the Southwest.

In 2005, TXI deployed Oracle E-Business Suite to streamline its administrative processes and increase efficiency companywide. The implementation was also instrumental in enabling the asset-intensive company to optimize preventative maintenance of equipment required to run its three major cement plants.

More recently, to address a recurring challenge of decentralized and manual processes for entering 180,000 vendor invoices annually, TXI deployed Oracle WebCenter Imaging 11g. Previously, invoice entry was a time- and resource-intensive process that entailed significant personnel requirements. Oracle WebCenter Imaging centralized the invoice processing system and routed documents electronically rather than sending paper invoices between offices. TXI gained significant efficiencies by reducing the number of hands required to touch an invoice before it is paid. Further, the company expanded visibility into its total spend to leverage better pricing, as it can more quickly pay invoices and take advantage of vendor discounts.

TXI is working to simplify its IT maintenance and support efforts by moving more middleware and applications to Oracle. To keep its IT environment running smoothly, TXI relies on Oracle Premier Support and My Oracle Support for expert advice and knowledge management, complete lifecycle management, proactive problem diagnosis and resolution, and expert configuration management. 

 
 

 
 

Challenges

A word from Texas Industries, Inc.

  • “Entering and manually processing more than 180,000 vendor invoices annually was time and labor intensive. With Oracle Imaging and Process Management, we have automated and centralized invoice entry and processing at our corporate office, improving productivity by 80% and reducing invoice processing cycle times by 84%—a very important efficiency gain.” – Terry Marshall, Vice President of Information Services, Texas Industries, Inc.

  • Increase the efficiency of core business processes, such as invoice processing, to support the organization’s desire to maintain its role as the Southwest’s leader in delivering high-quality, low-cost products to the construction industry
  • Meet the audit and regulatory requirements for achieving Sarbanes-Oxley (SOX) compliance
  • Ensure cement plants and machinery are up and running reliably, a vital requirement for an asset-intensive company that operates three cement plants and stocked US$50 million in spare parts
  • Streamline entry of 180,000 invoices annually to accelerate processing, reduce errors, cut invoice storage and routing costs, and increase visibility into payables liabilities

Solutions

Oracle Product and Services

  • Replaced a disparate, home-grown enterprise resource planning system with Oracle E-Business Suite, helping to achieve SOX compliance and improve efficiency companywide, while also reducing IT maintenance burden
  • Deployed Oracle iProcurement and moved to electronic purchase orders for 10 of the company’s top vendors, with plans to include more the following year, helping to accelerate processing and strengthen governance by keeping all order data in one system
  • Streamlined accounting and purchasing activities by centralizing processes in one system that provides relevant information to all production facilities
  • Deployed Oracle Enterprise Asset Management and leveraged its work order and scheduling capabilities for a more proactive maintenance approach and to optimize TXI’s workforce, helping reduce equipment maintenance costs and ensure uninterrupted cement production
  • Provided employees with single sign-on, enabling convenient access to applications and corporate content on the company’s intranet using Oracle Portal
  • Enabled customers to view and pay invoices and track shipments via TXI Online, which has contributed to a reduction in days sales outstanding
  • Worked with Oracle Partner O2Works to complete the Oracle E-Business Suite implementation in a phased rollout
  • Replaced a resource-intensive, paper-based, decentralized process for invoice entry with a centralized solution leveraging Oracle WebCenter Imaging 11g
  • Worked with Oracle Partner Keste to develop a smart routing solution that enables users to capture invoices electronically with Oracle WebCenter Capture and then uses Oracle WebCenter Forms Recognition and the Oracle WebCenter Imaging workflow to send the invoices through to Oracle Financials for approvals and processing
  • Significantly lowered resource needs for payable processing through centralization and improved efficiency 
  • Improved cash flow and visibility into payables liabilities, which is vital to strategic financial decision-making
  • Tightened controls and consolidated purchasing, enabling the company to optimize its US$500 million annual spend, much of which is for raw materials and parts used in its manufacturing plants, by taking advantage of total-spend visibility to negotiate volume discounts with vendors
  • Enabled the company to process invoices faster and pay bills earlier, allowing it to take advantage of additional vendor discounts
  • Tracked to increase productivity by 80% and reduce invoice processing cycle times by 84%—from 20 to 30 days to just 3 to 5 days, on average
  • Achieved a 25% reduction in paper invoice storage costs now that invoices are captured digitally, and enabled a 50% reduction in shipping costs, as the company no longer has to send paper invoices between headquarters and production facilities for approvals
  • Expected a significant reduction in the risk of duplicate processing through a more consistent process and detailed audit trail
  • Supported future growth by enabling the payables process to scale with little extra cost or effort
  • Benefited from Oracle Premier Support and My Oracle Support, which helps the organization ensure optimal performance of its Oracle implementations through real-time advice and self-service tools, complete lifecycle management support, proactive problem diagnosis and resolution, and expert configuration management

Why Oracle

TXI considered other ERP vendors but already had an investment in Oracle Database. It also relied on several third-party applications that use Oracle Database, which made the Oracle E-Business Suite the best option regarding the ease of integration. The company benefits from having a single vendor for most of its databases, applications, and middleware, so Oracle WebCenter Imaging 11g was a logical choice for that project, as well.

“Having a single vendor helps reduce the cost and effort required, since we only have to make one phone call. Also, when it comes time for upgrades, a single vendor simplifies that process, as well” said Terry Marshall, vice president of information services, Texas Industries, Inc.

TXI also benefits from Oracle’s comprehensive support programs and services, including Oracle Premier Support and My Oracle Support, which helps the organization troubleshoot potential issues and maintain the performance of its extensive and mission-essential Oracle environment.

Implementation Process

TXI initially deployed Oracle E-Business Suite in 2005, rolling out modules in a phased approach, as business needs arose. The process began with Oracle Financials and Oracle Internet Expenses. More recently, TXI added Oracle iProcurement to facilitate a move from a decentralized to a centralized purchasing process. While implementing Oracle WebCenter Imaging 11g, TXI also completed a migration from Red Hat Linux to Oracle Linux.

Partner

TXI worked with O2Works on the original Oracle E-Business Suite implementation and then with Keste LLC for the Oracle WebCenter Imaging 11g implementation.