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Kodak saves $2 million with consolidated billing system.

Ben Franklin once noted that "A penny saved is a penny earned." The old adage rings true every day in Kodak's Buisness Support Services Division, which recently revamped the compamy's billing operations. By centralizing and autommating its invoicing system on two Spar-based file servers from Sun Microsystems, Kodadk saves more than $2million dollars per year-one penny at a time.

The new invoicing systems generates capital as well, according to Linda Hollembaek, manager of Business Support Services (BSS).

"We now guarantee that each invoice goes out within 24 hours after the order is received," Hollembaek explains. "By receiving payments one to two days faster, the system earns Kodak thousands of dollar in intrest alone."

Faster payment from customers improves flow throughout the corporation, Hollembaek says. "It' basic accounting: if you have more cash in hand, you earn more with it," she says.

There are benefit beyond the monetary gains, according to Gary Klein, original project designer. At many corporations, overseeing mailing and billing operations is a mundane,thankless task. But, by p1tting his MIS skills to work. Klein and his systemteam have sucessfully transformed Kodak's mail center into a competitive marketing wepon for the company. Information is power, he says, and the pair of Sun file servers is a valuable resource in more ways than invoicing .

For example, before a Kodak division embarks on-volume, targeted mailing, or begins setting up a promotional seminar, they may consult with the two Sun SparcServers to check the plan's viability.

Says Klein, "The servers crunch all the numbers and ansewr key questons, such as,'How effective was a similar mailing or seminar in the past?' Or, 'How many customers can we count on for a response in a certain region?' If you can track historical data and answer those questons in advance, you increase your chances of producing good result."

A Key ingredient

A good computer networking strategy was a key ingredient in the success of the new invoicing system Kodak opted to base the new billing system on two Sun file servers so that Business Support Services could "talk" to the different divisions within Kodak-many of which run on proprietary hardware platforms.

According to Phil Clark, supervisor of the BSS Systems group, the sun servers act as a hub, constantly communicating across the network with disparate systems such as DEC VAX mini-computers and IBM mainframes.

"Kodak runs every type of computer hardware imaginable," Clark says. ''Sun's networking strategy enables us to centralize information and billing operations while preserving the company's existing hardware investment."

Business Support Services' computing system consists of two SparcServer 490s linked via Ethernet and Sun's NFS networking software to more than 100 PCs and eight Sun workstations, including four compact, desktop SparcStation 1s and lower-end SparcStation IPCs.

The servers are also networked to the IBM mainframe and linked to a network of VAX-based computers in Kodak's Marketing Education Center (MEC), which handles telemarketing and promotional mailing operations. Via Ethernet , the sun servers communicate with 11 Sun-386i workstations in Kodk's Facilities Organization. Here, the servers help facilities managers by storing and routing data such as graphical and diagrams of floor plans. In addition, the servers link to a network of postage machines, which store internal billing information.

Finally, the servers are linked to five Kodak Ektaprint 1392 printers, each capable of printing 92 pages per minute.

For software, the servers run Oracle Corp.'s relational database management systems (RDBMS). According to Clark, the RDBMS oversees a reporting system that operates nationally and may someday track data on a global scale. The servers also run a program developed in-house that assigns and sorts bar codes for additional post office discounts.

The numbers tell the story. In the past, Kodak mailed an average of 30,000 invoicing daily, each in its own envelope. Today, the same number are mailed in fewer than 6,000 envelopes, reducing labor-intensive envelope stuffing tasks and slashing postage cost by more than 80%. For example, rather than send seperate envelopes from 10 division to a given customer, Kodak now mergers all 10 invoices imto a single envelope, thus spending roughly 29 cents instead of $2.90.

To most, that doesn't sound like a lot of money, " Clark says. "But when you consider that we send out thousands of invoices every day, it adds up. All those pennies we save can amount to $2million at year's end."

To illustrate the workings of the new system, Klein cities as an example The Chase Manhattan Bank. As a Kodak customer, Chase Manhattan regularly order a variety of Kodak products and services. On a given day, the bank may order toner from the Copier Products

Division, film supplies from Imaging Products, and maintenance work from thre Customer Service Division. Previously, Kodak would have generated three different invoices for the bank, each division mailing its bill seperately two to three days after receiving the


Now, each division enters its invoices remotely into the new computer system. For example, the Copier Products Division uses VAX-based terminals to enter its billing information for the bank and send it to a mainframe and then, via Ethernet, to the SparcServers. Each bill is assigned a bar code, which comprises the customrs's zip code,plus four digits indicating weight and number of pages in the invoice. Running Oracle's RDBMS, the file servers pre-sort all the invoices by zip code, including the three to be sent to Chase Manhattan.

"It all happens in one fell swoop, " Klein explain." The entire process is internal on the file servers. The operator monitors a screen that displays the total number of invoices entering the servers and compare it with the total coming out as hard copies off the laser printers."
COPYRIGHT 1993 Nelson Publishing
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

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Publication:Communications News
Date:Dec 1, 1993
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