Machine Learning Benefits for Grocery and Hospitality
by The Ottimate Editorial Team
How Machine Learning Benefits Grocery and Hospitality Organizations (Don Dittmar Part 1)
Companies in many industries are still relying on manual workflows in their AP departments, while others have digitized some documents. The new generation of AI-driven automation solutions have the promise to transform procure-to-pay processes in both scenarios. In this second installment of our SME series, Ottimate Vice President and Head of Product Don Dittmar shares how machine learning provides greater insights, why a specialized AP automation solution is more effective than basic enterprise software features, and how grocery and hospitality customers are benefiting from Ottimate.
OTTIMATE: Can you give me a quick overview of Ottimate and what makes the company different from other providers?
DON DITTMAR: We started providing AP automation for small businesses, specifically restaurants, and have grown significantly since. Our unique approach uses the best of machine learning as our foundation, instead of pursuing a document-centric method. Ottimate learns from each invoice rather than just processing and handing it off. We’re constantly building a knowledge base for each customer about their invoices, purchase orders, payments, virtual cards, and spend management.
The value is not just in the faster throughput, but also the insight contained in the transaction flow from data and the actions, workflows, and processes that go with it. Ottimate learns from our customer’s information and feeds that back to them as optimized automation and insight.
OTTIMATE: An ERP system might offer what they would call AP automation, but can this be too basic?
DON: Yes. Some offer AP automation, but it isn’t flexible and stays in a box inside that big ERP data structure. In contrast, Ottimate has the flexibility to integrate with the ERP and hand off the transaction information that it processes. It’s flexible with multiple kinds of invoices and other documents that are outside statement reconciliation. This makes it applicable to entire AP processes and allows Ottimate to adapt to customers’ unique needs. ERP tools can do some extraction, classification, OCR, and other things on an invoice. That’s fine for simple, occasional use, but for higher volume, you need a dedicated AP automation platform.
OTTIMATE: What’s your role at Ottimate?
DON: I joined Ottimate four months ago to serve as vice president and head of product. We’re heavily investing in product management because we’re committed to growing our features, capabilities, and vision for becoming a product-centric organization. We want a lot of the interactions with our customers from support services, engagement, and customer success perspectives to be done in the product, so we’re facilitating that. My role is to head up product functionality and strategy, down to the feature level. It also includes detailed development and working with our engineering teams to maximize machine learning.
OTTIMATE: Who are some of your main customers?
DON: We started with fast casual, weekend casual, and fine dining restaurants and discovered that there were many granular details in the buying process, such as a lot of ingredients. Maybe you buy 16 items to just create one item. Going through the whole menu, you could have hundreds of purchases.
We learned that a lot of industries face similar challenges. This helped us expand into adjacent industries. We’ve taken everything we learned about restaurants into hospitality. Hotels, country clubs, and movie theaters buy lots of goods, materials, and services and combine these into products they sell. They need a tool like Ottimate to manage their procure-to-pay processes.
We’ve also expanded into retail. Grocery is another industry that has a lot of similarities. In a typical supermarket, you’ve got produce, canned goods, and many other items. Ottimate allows stores to match and predict buying patterns and behaviors with a product catalog or inventory file so that customers can manage their stock in detail with machine learning and artificial intelligence. Ottimate serves a wide variety of customers well.
OTTIMATE: How does Ottimate help these clients achieve their objectives?
DON: We offer peace of mind in their buying process. We know that no matter how our customers end up making a purchase, whether that’s through a PO, a two- or three-way matching process, or a non-PO buy for an unplanned expense, we’ve got it covered. Ottimate also allows people to pay through a virtual or spend card program or petty cash disbursement. No matter how you buy in your operation we want to support you, so you have the best economy of scale. Ottimate covers all kinds of purchasing and every variety of invoicing that goes with them.
OTTIMATE: What’s an example of Ottimate providing an industry-specific solution?
DON: One of our newest products is catalog matching for grocery customers. Imagine you’re buying apples for your store. You’ve ordered so many cases that the vendor bills for it by pallets. Ottimate’s machine learning works with your catalogs to understand how many apples are in a bag, bags are in a case, and cases are in a pallet. The system matches the invoice with what you intended to purchase to make sure that you received the type and quantity of apples you ordered and that they’re priced correctly.
This eliminates misspend and ensures there is as much straight through processing as possible with each invoice. You’re also getting as much knowledge into your data model as possible. Maybe we purchased a pallet of apples, but we probably only needed six cases and can adjust our order next time.
OTTIMATE: Are there any Ottimate solutions tailored to the hospitality industry?
DON: Yes. We have lots of customers who run country clubs and golf courses, and they have a very specific way of tying purchasing to events in their business flow. They want to understand what the pro shop is doing versus the course itself and see how purchasing lines up with their overall operations. So we created flexible dimensions in Ottimate so that they can take their invoicing flow and the machine learning that goes with it and line it up with the way they’re managing their business in the ERP.
That can be as simple as managing a single site or running multiple locations with several lines of business within each one. Other kinds of hospitality customers – like restaurants, hotels, and movie theaters – have their own specific processes that Ottimate can automate. There are a couple of commonalities: serving their customers well and making sure that lines of business keep running efficiently. So helping control their spending enables those customers to manage their operations and the micro columns within each effectively.
OTTIMATE: What are some of the customer roles that you work most often with?
DON: Our most common customer contact is the CFO, the VP of finance, or the office of the CFO. The accounts payable department is very important, but the reason an executive is often involved is because their processes affect treasury. Almost all of our customers are cashflow dependent businesses, so the ability to predict outflows in terms of an organization’s treasury is impacted by their payables.
Ottimate also reduces audit costs compared to a manual audit where you’re checking invoices for approvals. Another main touchpoint is the office of the CIO. We offer a SaaS technology that has to fit with a company’s overall solution and tech stack. In the hospitality and grocery industries, Ottimate is used by the operations team, too, because with distributed locations, you’re going to have users who may not see central finance but are responsible for their own store or line of business.
OTTIMATE: What are your favorite features in Ottimate?
DON: I’ve used different generations of AP tools and really like statement reconciliation. When they’re laid out well, you only handle exceptions. Catalog matching allows you to see if amounts don’t match a vendor’s quoted prices and find discrepancies with quantities. You can also know if they delivered on time and satisfied the SLA. These kinds of things are transformational for a business because they go beyond getting dollars out the door.
Ottimate also creates peace of mind. When I oversaw a manual process, we missed payments to a board member. The travel expenses and other fees on his paper invoice went unpaid for two or three quarters. He eventually called the CFO and that created a lot of attention. You can’t miss those high priority payments. With Ottimate, these sorts of things just run, and if there is an exception, you’ll be notified so you can handle it.
Interested in learning more about how AP automation can benefit your business? See Ottimate in action.
And check back soon for part two, in which Don explains the advantages of integrating AP automation with an ERP system, how Ottimate solves common AP pain points, and more!