Yeshiva University Renews Its Technology Heritage With iWay

Integration Solutions From Information Builders Streamline Grant Allocation and Procurement

Yeshiva University, a distinguished institution of higher education, has five campuses in New York City and one in Israel. Its rigorous academic program receives consistent international acclaim, and contributes to the university’s ranking as one the top 50 schools in the U.S.

Fiscal responsibility is crucial to the university’s mission of combining the best of contemporary civilization and knowledge with the ancient traditions of Jewish law and life. The more efficient Yeshiva can make its information systems, the more capably it can pursue its charter.

This philosophy of fiscal responsibility motivated Yeshiva to purchase iWay integration technology from Information Builders. iWay’s rapid integration solutions have enabled Yeshiva to maximize its research assets, simplify grant administration, control spending, automate accounts payable and procurement processes, and create highly sophisticated workflows that reduce manual effort for administrative staff.

One key iWay interface streamlines a procure-to-pay workflow process and is expected to save the institution hundreds of thousands of dollars annually. Another interface helps the university to maximize the use of its research facilities by enabling both internal and external personnel to use grant dollars instantly when they reserve university equipment.

"We selected iWay because it has the flexibility and extensibility to solve our immediate integration problems and serve as a foundation for future integration needs as well,” explains Jack Zencheck, chief procurement officer at Yeshiva University.

Simplifying Procurement Activities

Yeshiva recently deployed a single-use accounts (SUA) business service from JPMorgan Chase that automates payment, reporting, and reconciliation processes. The solution drives spending to preferred suppliers and promotes process efficiencies through electronic transactions. JPMorgan Chase offered a monetary incentive in the form of a rebate for all business Yeshiva could drive through the SUA channel.

Yeshiva previously paid its vendors using paper checks, which typically took 30 days to process. With standard 45-day payment terms, vendors would have to wait as long as 75 days to receive their payments, which prevented Yeshiva from taking advantage of the rapid payment discounts that some vendors offer.

SUA-enabled vendors must agree to absorb a merchant fee in exchange for much shorter payment terms – from 75 days to 30 days. For most, getting paid faster would more than offset this merchant fee. At the end of each month JPMorgan would send a cumulative invoice to Yeshiva, which would be paid automatically by Automated Clearing House (ACH).

It sounded like a great arrangement, but Zencheck knew the process would have to be seamless to merit the implementation effort. The university engaged Information Builders Professional Services to set up the requisite interfaces between Yeshiva’s legacy financial systems and the SUA system, as well as to engineer a complete business process workflow.

“Our objective was to automate as much of the integration work as possible, lessening the need for manual intervention,” recalls Zencheck. “If it weren’t for iWay, we would not have been able to pull this off. iWay’s technical expertise was phenomenal. They showed us how to automate the entire process, from receipt to settlement, through this SUA system.”

iWay began by mapping all the payment information in the SUA system to the university’s general ledger. Then iWay set up the necessary interfaces to JPMorgan’s financial gateway. Now, when an invoice is submitted from a vendor that has previously registered to receive SUA payments, the invoice is placed in a database table and picked up by iWay. Once Yeshiva’s accounts payable personnel approve the invoice, iWay forwards the transaction to JPMorgan, which has a four-hour window to process the order and release funds to the vendor’s unique SUA identification number.

iWay not only automates these transactions, it also monitors the workflow to make sure JPMorgan upholds its four-hour service-level agreement. If iWay doesn’t receive a confirmation that JPMorgan has processed the transaction within four hours, it logs an entry in a daily report, which is sent by e-mail to Yeshiva. The report lists pending transactions that have not been approved, as well as transactions that have been delayed longer than four hours.

“Payment is pretty much instantaneous once the invoice is approved by our AP department,” explains Zencheck. “But iWay does more than just send and receive transactions. It also performs essential business process monitoring functions.”

Rapid ROI With a Measurable Return

Yeshiva University tested the SUA system with five vendors, and it worked perfectly. Since then, more than 150 vendors have signed up, a number that is expected to grow to several hundred and to drive $30 million in annual procurement spending through preferred SUA contracts.

According to Zencheck, everybody wins with these new procurement and payables processes. “After an invoice is approved, the vendor gets an e-mail message saying that the money is in their account,” he explains. “Yeshiva doesn’t have to issue checks and the vendors don’t have to process them. It’s more efficient all around; no bank runs, no float, no waiting for checks to clear. It saves a lot of time for everyone.”

Zencheck believes these simplified accounting procedures will enable the university to reduce its accounts payable staff by half and redeploy these employees elsewhere. The university also expects to allocate $300,000 worth of SUA rebates each year against its technology costs.

“More margin means more mission,” he notes. “In other words, the more money we save as a result of these new financial processes, the more we can invest into the needs of the university. By simplifying the integration work and forging system-to-system connections, iWay has shortened our reconciliation periods while improving accuracy.”

Yeshiva has successfully deployed iWay for other purposes, such as creating an information system that helps researchers reserve time at the university’s shared research facilities. With its former reservation system, the university was not able to track these activities and the associated reimbursement from outside funding sources in a timely manner. There was no way to validate the availability of funds in real time. Instead, the university tracked the information in an Excel spreadsheet that was distributed monthly, leading to long delays due to matching approved funds to actual research hours spent using university equipment and facilities.

To fix this problem, the university developed a shared facility management system (SFMS) to manage activities at 40 research facilities across multiple campuses, and then took advantage of iWay Service Manager to link it with their legacy financial systems.

“We wanted to make it easier for researchers to reserve time on our shared equipment and facilities – to match reservations with active grants, verify available funds, pre-encumber funds from those grants, and ultimately charge back and bill based upon actual usage,” says Zencheck.

Yeshiva created the SFMS application using BPM-1 business process management technology from Pallas Athena. Once this was done, Professional Services created an interface from the new SFMS system to the university’s financial system, where information about grants is maintained.

iWay Service Manager uses web services to send and receive two types of transactions between these systems: encumbrance and invoicing. Encumbrance transactions come into play when a researcher wishes to reserve facilities or equipment; the researcher enters his or her grant number and iWay validates that this individual has sufficient funds available within the specified grant. iWay conducts a similar transaction to invoice for the actual usage of the university’s equipment and facilities.

“This project proved the potential of iWay and gave us confidence to push ahead with the procure-to-pay project,” explains Zencheck. “With iWay and other new information systems, we are putting in the requisite technology to support our technology objectives.”