DFAS Kansas City welcomes "human voucher".

The invoice asked a lot of questions.

Usually paperwork contains more information than it asks for, but this invoice was different. It wore glasses and a sport coat, and there was much it wanted to know. This was not your usual invoice.

The Defense Finance and Accounting Service Kansas City (DFAS-KC), which manages the Marine Corps' books, processes invoices for payment to businesses contracting with the Corps. After arriving in the mailroom at DFAS-KC, invoices join their contracts and receiving reports and become vouchers. This voucher consisted of Marine Corps Fiscal Director Charles E. Cook III, a piece of paper pinned to his jacket.

An explanation: Interest is paid on a "net 30 days" contract whenever payment is not made within 30 days of receipt of a valid invoice or an acceptance of the goods or services, whichever event is later. Last year, the Pentagon's comptroller, Dr. Dov Zakheim, decided that all Department of Defense (DoD) entities needed to decrease the amount of interest they were paying. As a result, he directed the DFAS to work with the military services and Defense agencies to develop and execute plans to reduce fiscal year 2003 interest penalty payments by 40 percent from the fiscal year 2001 level of interest payments. According to DFAS records, in fiscal year 2001, nearly $1.8 million in interest was paid to vendors providing goods and services to the Marine Corps. Mr. Cook, upon whose shoulders rests the responsibility for managing the Marine Corps' funding, wanted to know why.

Vickie Kilgore was glad to show him. As the DFAS-KC Vendor Pay site manager, she believes that her staff is already well on the way to making changes to their internal business practices that will help to decrease interest payments. She also wanted to show Mr. Cook further changes she had planned. The best way to meet both of those goals, it was decided, was to "walk" him along the path that invoices take through DFAS KC--from their receipt in the mailroom to their payment to the vendor.

Following the Paper Trail

That's why the agency's client executive for the Marine Corps, DFAS-KC Site Director Greg Bitz, proposed that Mr. Cook visit Kansas City. So it was that, on September 26,2002, a paper marked INVOICE was pinned to Charles Cook's jacket and was date/time-stamped in the mailroom. He then followed the path that invoices take to the Vendor Pay section, and into the system of approval required there, before moving on to the Disbursing section.

He wasn't just following an invoice. He was an invoice. "It was very helpful to me, as a person who largely learns by experience, to live the process," Mr. Cook said.

And learn he did. "One of the things that strikes me," he said, "is how many times a voucher has to be touched in the database."

In fact, a normal voucher, with no problems, will pass through about a half-dozen hands in DFAS-KC. The voucher--a physical folder--moves from desk to desk; and, if everything is filled out properly before it arrives, it easily should meet the deadline for payment.

That, however, is a big "if."

"The daunting thought is really the quality of the invoices coming in," said Mr. Cook, who echoed a constant complaint of those who process vouchers in the Vendor Pay section. Small discrepancies in paperwork can lead to big problems--and big delays--in the payment of the Marine Corps' bills. Sometimes, invoices and receiving reports have errors that cause them to be sent back to the submitting contractor or to Marine Corps command. Some invoices may also have been "pre-aged" by the process of getting approved at the local command.

As Mr. Cook stood in the Vendor Pay section that day, an invoice began cranking through the Vendor Pay Rightfax (a fax machine that enables DFAS-KC to accept invoices) that had only a few days left before it would begin racking up interest. Had it been sent through the mail, interest might have attached to it even before it had arrived. "There ate portions of the process that need to be improved," said Mr. Cook. "But it's obvious that people here are wrestling with how to improve them. People are, at least, aware of [the problems], and that's a start."

New Technology: A Solution

One of the most important items Ms. Kilgore wanted to get across to Mr. Cook is that all of this may soon be improved immensely with a technological advancement known as Wide Area Work Flow (WAWF).

As mentioned before, enough people touch a voucher in DFAS-KC before it is paid that even a fingerprint lab and a couple of bloodhounds might have trouble telling you where a specific voucher has been. There are tracking systems in place, but mistakes happen. Not only that, but, in using a physical document, changes must be made on paper before they can be approved--often by the contractors themselves--requiring that the invoice be sent back and forth. Explanations must be made and understood. Then-finally--the payment will be disbursed after what could amount to a couple weeks' worth of "mail tag."

When the WAWF system arrives in the Vendor Pay section (it's currently being tested), it could all but eliminate the problem of late-arriving invoices and receiving reports, and it should eliminate most errors in completing those documents.

Here's how it works. The vendor signs up for WAWF and is given a unique identification and a password. Then, when the vendor needs to submit a voucher to DEAS for payment, he simply fills out an online form. Internal edits ensure that the online form can't be transmitted until it's been properly completed. Once the vendor completes the form, it is "warehoused" on the Internet while an e-mail goes to the local approving officer, telling him or her where the document can be found. Once the approving officer properly completes every block, the documentation is forwarded to DFAS.

Once a DFAS Vendor Pay staffer receives an e-mail telling him or her that an invoice--already electronically "attached" to the contract and the receiving report--is available for processing, he or she can immediately go to that action and start it through validation. No mail time delay, no improper forms. The WAWF system should change everything.

Vickie Kilgore said that Mr. Cook's visit was a huge success. He is passing on the word that decreasing the amount of interest payments will demand a team effort at all levels. "Since he's returned to Washington, he's been getting out the word to local commanders," Ms. Kilgore said.

As for WAWF, Ms. Kilgore said that she "wanted it six months ago," but knows that a decision about its use will have to come soon. The Marine Corps is developing a WAWF implementation plan.

In the end, Mr. Cook's visit as an invoice might have been best from the perspective of both the staff members of the DFAS-KC Vendor Pay section, who now know that their work is noticed, and Mr. Cook himself. "He's a big-picture kind of guy," Ms. Kilgore said. "Now he has more of the picture. I think that he's very well aware of what goes on in Vendor Pay."