Re-engineering the procurement process is paying off for the Denver News Agency. In two years, it has increased the number of purchasing card holders by 18%, transactions by 25% and spending per card by 32%.

After the Denver Post and the Rocky Mountain News entered into a joint agreement in 2001 forming the Denver Newspaper Agency, Ginger Young, purchasing director, evaluated the company's purchasing process. Rocky Mountain News had a purchasing card program in place, but it didn't have the flexibility she thought it should have to fill the needs of the new organization. Instead of trying to make it fit, she decided to take a new look at the entire procure-to-pay process. She also wanted a card company to provide her with real-time reporting on employee spending.

Young turned to Wells Fargo Bank. To assist her, Christine Hunsucker, vice president and manager of the commercial card division at Wells Fargo, in conjunction with associate partner Visa, created a multitiered plan.

After ensuring management was comfortable with going forward, Young and Hunsucker began a nearly year-long process of revising company thinking and changing the old purchasing system. With the assistance of Visa's Commercial Card Program Optimization guidelines, Hunsucker helped Young formulate an action plan to optimize the news agency's purchasing process. Using the guidelines, Hunsucker compared the agency's practices with those of corporations that Visa has determined demonstrate best practices in both qualitative and quantitative terms.

Based on results of the review, the Denver News Agency (DNA) receives tailor-made suggestions for its own practices and a set of tools specifically relevant for its needs.

Hunsucker introduced Young to Visa's Commercial Card Expense Reporting (CCER), an online tool that allows authorized managers and cardholders to view card statements, updated in real time. CCER features out-of-pocket expense reporting that reduces the time it takes to calculate an expense report from 10 minutes to about two.

One Visa tool Young especially likes is a vendor-matching program that allows DNA to dramatically reduce the amount of paper involved in the purchasing process. Through it, she has shared AP data with Visa which determines which of DNA's suppliers accept its card products and the level of data (level one, two or three; level-three data is line item detail) they are capable of providing. "We'll take that list and sort it by suppliers that have the most transactions because obviously it costs more to cut checks to pay them. We'll actively go after them and let them know that from now on we want to pay by credit card," Young says. Once a credit-card paying relationship has been established with a supplier, its wait-time for payment is drastically reduced.

At the same time, DNA began using Visa's one-card product to pay for all employee transactions. With a one card, employees can pay for travel expenses as well as items they typically buy with pcards. Using controls available from card providers, management can restrict transaction ability by merchant category code (MCC).

"We pay for our New York Times crossword puzzles, our comics, IT equipment—just about anything you can put on a purchasing card," says Young. "We also use it for relocation, so instead of sending someone a check or asking him or her to complete an expense report, we give him a declining balance relocation card. It seems to work well."

The DNA editorial staff also uses a cash advance option on the card for when correspondents travel abroad. Young says that the card was particularly effective in reducing the amount of telecommunications invoices DNA had to process by allowing the company to process them immediately.

Wells Fargo's card program gives DNA spend data and flexibility. In addition to the one cards issued to DNA employees, Young has a super vendor card that she uses to pay for most of the items ordered through the purchasing operation. While her card is set up with few restrictions, its use can be controlled by merchant category code. Users can view spend data by transaction online using the CCER system.

To implement the new payables process, DNA developed a comprehensive training program. "We wrote explicit procedures and a cardholder agreement form," says Young. "We phased in departments and trained by department."

Crucial to implementing a new process or even making changes to an old one is well-informed senior management who are willing to endorse a new purchasing model, say both Young and Hunsucker. Young acknowledges that at first there were some concerns from senior management over the efficacy of a new model and its controls on employee spending. "After several meetings, we convinced them that we could bolt down the program and tighten it as they thought they needed," says Young.

"We also included a letter in our policies and procedures brochure from our CFO that endorses the program," she says. "It helps a lot. Senior management buy-in is key to getting a program off the ground."