VVU U1/L@UTU YL1/UNUU/LOSTO 1 METHOD FOR PROVIDING ACCOUNTING, BANKING AND PAYROLL PROCESSING FROM ONE SOURCE CROSS REFERENCE TO RELATED APPLICATIONS 5 This application is based on and claims priority on US Provisional Patent Application No. 60/156245 filed on 27 September 1999. BACKGROUND OF THE INVENTION 1. Technical Field The present invention relates generally to the field of providing integrated 10 solutions to businesses for their accounting, banking, payroll, procurement and employee benefits needs, and relates more specifically to a computer network enabled solution allowing users to obtain accounting, banking, payroll, procurement and/or employee benefits services from a single source. 2. Prior Art 15 Currently, as shown in FIG. 1, business customers (and even individuals) must install (or access via the Internet or other data communications method) separate software (from different vendors) for the following application groups: 1. Enterprise Resource Planning (ERP) software, which includes financial software (general ledger, accounts receivable, accounts payable, and the 20 like), manufacturing software (inventory management, production management, etcetera), commercial software (invoice/billing, orders/quotes, etcetera), distribution software, and other related software. Some vendors (such as SAP, Baan, Oracle, PeopleSoft, etcetera) currently provide integrated software packages with some or most of these ERP applications. 25 2. Outsourced payroll and Human Resources (HR) services/software, which includes the ability to pay employees and process/pay related taxes. Vendors providing this service today include ADP, Paychex, Ceridian, and others. Typically the bulk of the software for this service is located, and the bulk of the processing is handled, at the vendor's location, although the customer may have WUU 1/Z4UyU _TILUNUU/LO :WO 2 some minimum amount of software installed at the customer's location in order to access the vendor's software. 3. Banking services, which include regular banking and electronic banking. Generally all of the software and processing is handled at the bank's 5 location. Electronic banking is merely Internet access (or via data communications method) to the software/processing at the bank. Most major banks plus newer Internet banks (such as Net Bank and Security First National Bank) offer Internet access to a customer's accounts. No one vendor provides all of these services/products/applications in an 10 integrated fashion. Therefore, the following differences/problems occur: 1. The customer experiences a different look and feel for each of the three or more applications. 2. Computer program interfaces must be written to pass data back and forth between the three or more applications. Sometimes these interfaces cannot 15 be written on a cost effective basis. 3. Checks written by a customer using their accounts payable software have to be reconciled/cleared manually or via an interface when the check clears the bank. Thus, it can be seen that there exists a need for an integrated one source 20 computer network enabled solution allowing users to obtain accounting, banking, payroll, procurement and/or employee benefits services, as well as other typical and atypical business services and products. It is to this need that the present invention is directed. BRIEF SUMMARY OF THE INVENTION 25 The new method of the present invention integrates all three major application groups (ERP, Banking, and HR/Payroll outsourcing) using integrated computer code and are offered to and used by the customers as one package. All three major application groups, as well as additional application groups as the needs arise, have a similar look and feel and require no interface between the 30 application group packages. Automated routines handle processes such as: WU U1/L4U!?U L'1/'IU UILOD'OD 3 1. Automatically reconciling checks when written and cleared by the bank. 2. Automatically posting (and reconciling to books) payroll disbursements to the bank account. 5 3. Eliminate the need for most paper-based expense reports by automatically creating computer-based expense reports after bank credit card and other charges make their way from the vendor to the bank and then back to the accounting records. The benefits of the present invention include: 10 1. All three major application groups, as well as other application groups, are available from one vendor and with similar look and feel. 2. All three major application groups, as well as other application groups, are available via the Internet. 3. Using the present invention via the Internet, the customer always will 15 be using the latest version of ERP and other software, as the software of the invention is resident at the vendor. There is no need for the customer to reinstall or upgrade to the next version. 4. Customers do not have to distribute paychecks or pay remittance advices to their employees, as employees merely will use an Internet browser to 20 view the activity in their bank accounts. It is an object of the present invention to provide an integrated one-source solution incorporating a seamless combination of at least the applications of ERP, Banking and Payroll through a single provider. It is another object of the present invention to provide an integrated one 25 source solution of business applications that incorporates the same look and feel across all of the applications, thus increasing ease of use. It is another object of the present invention to provide an integrated one source solution of business applications that allows the customer to pick and choose between and among applications, using only those applications necessary WU U1/L4UVU FLT/UNUU/2OYb 4 or desired at the time and allowing the customer to add or delete applications as necessary or desired. It is another object of the present invention to provide an integrated one source solution of business applications that is resident at a central source or 5 sources so that the customer does not need to continuously upgrade computer software and is not using old and out of date computer software. It is another object of the present invention to provide an integrated one source solution of business applications that allows both the business customers, the individual customers and the employee customers to conduct all related 10 transactions through a single portal using a single solution. It is another object of the present invention to provide an integrated one source solution of business applications that is simpler, easier to use, more economical and faster than the current art. These objects, and other objects, features and advantages of the invention 15 will become more apparent to those of ordinary skill in the art when the following detailed description of the preferred embodiments is read in conjunction with the appended figures. BRIEF DESCRIPTION OF THE DRAWINGS FIG. 1 illustrates the prior art current method of delivery of ERP, Banking and 20 Outsourced Payroll/HR business applications. FIG. 2 illustrates the method of the present invention. DETAILED DESCRIPTION OF THE PREFERRED EMBODIMENTS The method of the present invention integrates at least the three major business application groups, namely Enterprise Resource Planning (ERP), Banking, 25 and Human Resources/Payroll (HR/P) using the same computer code. The combined system may be offered to and used by the customers as one package. All three of these major application groups, as well as additional application groups as the need or desire arises by the customer, have a similar look and feel and require no interface between the application group packages.
WU U1/L4UYU Yu1/Uu/UUIzObO 5 The invention comprises automated routines that handle processes including but not limited to automatic reconciliation of checks when written and cleared by the bank and automatic posting and reconciliation to financial books of payroll disbursements to the bank account. Further, the invention eliminates the need for 5 most paper-based expense reports by automatically creating computer-based expense reports after bank credit card and other charges make their way from the vendor to the bank and then back to the accounting records. The benefits of the present invention include providing all three major application groups, as well as other application groups, from one vendor and with 10 similar look and feel, providing all three major application groups, as well as other application groups, over a computer network, such as the Internet, always providing the latest version of ERP and other software, as the integrated software of the invention is resident at the vendor, and eliminating most paper-based transactions, such as paychecks and pay remittance advices, as customers use an Internet 15 browser to view the activity in their bank accounts. The present invention is an Internet Web portal that enables businesses and individuals, particularly small to mid-sized businesses, to handle all of their banking, accounting and payroll needs over the Internet. In addition, individuals can use the present invention to do their personal banking in much the same fashion as other 20 Internet banks. The present invention also will allow small to mid-size banks to easily and quickly implement Internet banking. Further, the present invention is a Web portal that allows small to mid-size businesses (typically defined as in the $5 500 million revenue range) to do everything they need to run their enterprise - from paying bills and invoicing customers, to banking, to paying their employees, to 25 financial reporting, and more. The total market for these types of services, referred to herein as the three major application groups, exceeds $60 billion today and is expected to grow over 25% for the next few years. The market for the financial software (ERP) space is over $15 billion - $ 5 billion in mid-market. The market for small business banking is 30 $40 billion today and is expected to grow 40% to $61 billion by 2003. The 6 commercial payroll service bureau market is over $6 billion. The market leader, ADP, has 153 consecutive quarters (over 38 years since becoming public in 1961) of record highs in revenue and earnings per share growth. ADP has enjoyed 13% EPS growth in the last 5 years and consensus estimates are 14.4% for the next 5 5 years. The present invention for business customers includes a set of integrated Web-hosted business services as follows: a. Financials - pay bills, invoice customers, general ledger, reporting, etc.; 10 b. Commercial banking; c. Payroll processing; and d. E-commerce. Businesses will be able to use the present invention in any of three offerings: 15 a. Integrated Financials, Payroll and Banking (includes a free bank account for the company and for each of their employees); or b. Payroll services; or c. Banking The present invention can be offered to business customers entirely on a 20 pay-as-you-grow, monthly basis - with or without any up-front license fees. Existing competitors will have a difficult time changing their existing business/channel models to compete with this approach. The financial (or ERP) software will be different from that offered by ASP's today because the customer does not buy a certain release of someone else's software. The customers of the present invention 25 will always be using the latest version/release of the present invention's software. The present invention provides a portal to the Web for use by entire companies and their employees. This portal is the entryway for all other dot com partner companies to gain access to the present invention. This entryway provides the staying power (or a compelling reason to return to the website) that most dot 30 com companies do not enjoy today.
WU U1/Z4UYU YC UlIJUU/2I590 7 All types of companies and individuals can use the present invention, preferably first by small to mid-sized businesses, then to the home, then to the largest enterprises. The focus of core services offered at the outset is the services that provide the most staying power for the Web portal, namely financials, banking, 5 and payroll. Additionally, sales force automation, field service, supply chain planning, and other services can be added via integrating and/or linking third party offerings. Small to mid-size businesses benefit from the present invention by being able to use enterprise class services with built-in world-class business processes 10 quickly and on a pay-as-you-grow basis. Customers never need to buy and install different software as their organization grows and becomes larger and more complex. Large businesses further benefit from instant worldwide access to latest best of-breed software/services from any site in the world. 15 The present invention may also serve as a typical Internet bank for individuals. The present invention allows people to do their banking and bill paying online. One differentiator between the present invention and the current art is that the individual users typically are employees of business customer users of the present invention. The biggest issue most Internet banks have today is churn in 20 that approximately 30% of Internet bank customers are lost each year. Employees of the business customers of the present invention now have a strong incentive to remain users of the present invention at least as long as they are employees of that company. A June 1999 report from IDC says that 6.6 million US households were banking online in 1998 with that number expected to rise to 21 million by 2001 (per 25 Forrester Research) and 32 million by 2003. The present invention provides the ability for banks to quickly offer Internet banking services to their customers. Banks use the present invention's web-based Internet capabilities to allow the bank's customers log onto a special site to perform banking services.
WU UIIZ9*UYU FT 1IUNUUI2690 8 One method of achieving of the present invention is to combine three existing businesses. These businesses are from three industries - mid-market ERP software, bank software, and a bank charter. The two software companies (the ERP and the bank software) could either be rolled-up as an entire business or via 5 contribution of a combination of select assets (source code for one of their platforms), technical and sales people. The payroll service bureau business could also be combined or could be included via a strategic marketing/integration arrangement. 1. ERP 10 The ERP industry is $15 billion today. The top 5 players (SAP, Oracle, PeopleSoft, Baan, JD Edwards) comprise 66% of the market and grew 43% in 1998 with expected growth of 15-30% in 1999 (temporary decline because of Y2K fears). Over 50 vendors represent the balance of the market. The ERP industry has transformed itself over the past decade from being 15 simply back office financial or manufacturing software to now include all software that an enterprise needs to run its business - from sales, to marketing, to call centers, to accounting, and beyond. For example, the ERP industry was once a very fragmented set of industries comprised of sets of companies selling software that satisfied only the need for financials, manufacturing, call centers, or sales 20 forces. Then SAP came along in the early 1990s and reshaped the scene by including all these elements in their offering. To compete with SAP, most ERP players are very busy trying to acquire businesses outside their core (for example, financial software companies buying front office businesses). There is a compelling reason to do this because of the 25 tremendous growth rates in those industries. AMR says those growth rates are 58% for marketing automation (lead generation and campaign management), 64% for contact management and sales configurators, 50% for call center, and 40% for field service (dispatch, and spare parts). In addition, the ERP industry has been constantly trying to adapt to changing 30 computer technologies: wV UML/4UPU FlT/UNUUI265O9 9 Legacy mainframe (1980) Client/Server (1990) Internet (2000) Batch data Distributed data Real-time Character UI Graphical UI Browser 5 Unix, NT ASP, Web-hosted In addition, most vendors are still one or two generations back in the technology race and are using mainframe, Unix or AS/400 platforms and may either be developing or have only recently (1-3 years) launched an initial NT product line. 10 Now the Internet has arrived and ERP players are having a very difficult time trying to decide how to allocate their precious resources and time. Most players below the top 5 are struggling deciding how to add product depth as described above, plus introduce and/or launch new NT offerings, and now add Internet capabilities. Most are satisfied to try to adapt their user interface (UI) from a 15 graphical UI to one that can be viewed with an Internet browser. They are then labeling their products as web-enabled. Some players have taken this a step further and have decided they should have an Application Service Provider (ASP) offering whereby one or more of their channel partners (the ASP) sells the software to the customer and the software is 20 installed at the ASP's site. Oracle has taken this one step further by hosting the applications themselves. The high-end players typically started out selling primarily financial software (for example, PeopleSoft sold human resources) to the Global 1000. They typically started with mainframe and/or Unix platforms and added NT products. Software 25 license fees range from $200,000 to $100 million or so, based on the number of users. Mid-market players typically started with one platform (AS/400 or Unix) and sold financials or manufacturing software to businesses that had small IT staffs. AMR says that one of the common misconceptions about small and midsize 30 customers is that smaller means simpler. The reality is that smaller firms are often lVU UtizIUYU FlT/UsUU/b0590 10 more complex because they must do more with less. Most deal with the same operational and logistical problems their larger competitors face. Of the 50 companies AMR interviewed, 58% operate internationally, 62% have multiple sites, and 44% operate under multiple legal entities. License fees typically range from 5 $25,000 to $200,000 but can venture into the $ 5 million range. Low-end players typically have an NT product that they sell through independent resellers or retailers to companies with under $25 million in sales. License fees are typically $ 5,000 to $25,000, based on the number of modules. 2. Banking 10 There are 2 types of Internet banks - Internet-only banks, and banks with branches that also provide Internet access to account balances. Internet-only banks are banks without branches or ATMs that focus on the Web (and telephone) to attract and service customers. Examples are Net.B@nk, Security First National Bank, Wingspan.com (FCC National Bank, subsidiary of 15 Bank One and uses Bank One's ATMs), CompuBank, MembershipBanking (American Express), eBank.com, and nBank.com. Internet-only banks have advantages over brick and mortar banks. First, Internet-only banks have a reduced cost structure. Booz, Allen, & Hamilton found that costs per transaction via the Internet are significantly lower than those via 20 different touchpoints as follows: $1.07 in a physical branch $0.54 over the phone $0.27 at an ATM $0.02 using PC-based dial-up 25 $0.01 over the Internet Internet banks have a significant cost advantage over regular banks - a savings of almost 3% of assets. D.R. Grimes, CEO of Net@Bank, says their non interest expenses are 1.6% of earning assets, compared with an average of 4.4% at a similar sized traditional bank.
WU UI/4U91U PCI/USUU/IZ6596 11 Second, Internet-only banks have better deals for the customer. All of the cost savings translate to better deals for the customer. Because of lower overhead costs, Internet-only banks can offer 6% CD rates to attract customers. Third, Internet-only banks provide better customer service. Internet-only 5 banks excel at providing customers with the best platforms for executing transactions online. They make it easy to open an account - customers can sign on from any browser and complete the entire account application online. Fourth, Internet-only banks provide quicker geographic expansion. Since Internet-only banks do not need to build branches to expand, they can reach a 10 global market instantly. Internet-only banks do have some disadvantages. First, they have no branches. Second, they have no cash deposits (deposits must generally be mailed so cash deposits would be impractical). The retail market for Internet banking is large. Forrester Research says that 15 25% of US households (38 million) have Internet access and 4.7 million households will bank online by the end of this year. By the end of 2003, they are forecasting online households at 59.8 million and online banking households at 18.5 million. Gartner Group says there will be more than 10 million online banking customers by the end of 1999 and that number will grow to 24 million by 2003. The OCC reports 20 that 4% of US households conduct banking transactions on the Web and 40% of banking customers now have accounts at banks that offer Internet banking service. The business market for Internet banking is large. IDC Research says the number of small businesses using the Internet is increasing dramatically - from 19.7% in 1996 to 41.2% in 1998. According to a 1999 Sheshunoff Report on 25 Internet Banking, as more businesses go online, banks have the opportunity to take commercial banking to a new level of convenience by providing them with the ability to manage payroll, pay taxes, and make electronic payments online. Meridien Research says banks generally serve small businesses through a patchwork of wholesale and retail systems, largely repackaged retail solutions, none designed 30 particularly for this in-between market. They go further to say that spending on WU U1/L4UYU PCT/IUSUU/ZS6596 12 small business banking services are expected to grow more than 60% to $61 billion by 2003. 3. Payroll Payroll service bureaus process payroll checks and automatic payroll 5 deposits in addition to filing payroll tax returns for businesses. Customers typically send in their payroll data via fax, entry into PC software/transmission, or via entry over the Internet. The payroll service bureau market is over $ 6 billion. The market leader, ADP, has 153 consecutive quarters (over 38 years since becoming public in 1961) 10 of record highs in revenues and earnings per share growth. ADP has enjoyed 13% EPS growth in its last 5 years and consensus estimates of 14.4% over the next 5 years. A key differentiator for the present invention is that, from the customer's perspective, the present invention is not a software company, it is a service 15 company. Competitors in the bank software and ERP software industries are selling a given release to their customers. Examples of this in the retail area are Windows 95/98/2000, Office 97/2000, etc. When you buy software you are buying only that version of the software. You are essentially guaranteed to have an obsolete product in the next 1-2 years. You must upgrade to some future release at 20 considerable pain and aggravation. The same holds true for ERP and bank software companies. By the time you buy and install Oracle R11, 2 years have passed and Oracle R12 or some later version is available. Generally, ERP and bank software customers do not have the luxury of having access to these incremental releases because upgrades are painful and expensive. These 25 customers typically wait for 2-4 releases before they upgrade. The present invention upgrades happen in almost real time and incrementally. When a noticeable upgrade happens to a screen or process, the user will be notified via a button that appears on their screen. Another key element is that upgrades and improvements to the software must be managed to minimize 30 the impact on users. Most software companies make wholesale changes to entire 13 modules when they produce a new version. This approach requires costly and time-consuming upgrades and training for users. Small improvements and changes to the underlying the present invention software will be managed and continually released to the present invention community on a frequent basis to change only 5 certain screens or particular business processes. In use, the present invention starts with typical brick and mortar markets, converges them and reinvents them. The three major applications (ERP, Banking and Payroll outsourcing) are merged. Further, e-commerce can be included with the three major applications. Through the present invention, users are provided 10 with financial services (ERP), banking services, web buying including electronic billing and paying, web sales, and payroll processing along with automatic deposit of payroll. The preferred ERP service includes the core business processes (financials, human resources, ledger, receivables, payables and invoicing), coupled with 15 optional modules such as: sales force automation, field service, customer service and manufacturing and planning. The preferred banking service includes all of the typical banking services (savings and checking accounts, access to loans and mortgages, credit cards and even investment services). The preferred payroll service includes all of the typical payroll services (direct deposit, payroll slips, and 20 federal and state tax reporting). The user can subscribe to the services of the present invention in many ways, including license fees, monthly fees, up-front payments, etcetera. The preferred subscription has no up-front fees, and only monthly fees for the services used by the customer. For example, the customer can select from the group of 25 three major applications, and from a group of miscellaneous additional applications. The customer pays a monthly fee for only those applications selected. The customer can add or delete applications as needed, allowing the service to grow with the customer. By combining the three major applications in a seamless service package, 30 customers can have automatic reconciliation of financial books, with the books WU Ul/24UYU PL)5UU6IZO9o 14 looking the same as the banks version of the customer's books. In this regard, the present invention will serve as the customer's main bank, with electronic commerce (payments and debits) being the norm and not the special situation. The integration of the three major applications will allow payroll to be deposited automatically into 5 the employees' accounts (from the present invention's payroll service to the present invention's banking service). The employee can access his or her bank accounts and employee information through the same service, preferably through an integrated web browser as part of the present invention. As part of the community of the present invention, all community members 10 can be connected to each other, establishing an electronic community that can buy from each other, access each other's services, and operate more efficiently. As each customer operates under a standard format, each customer easily can converse with other customers of the present invention. This allows for the present invention to partner with other vendors to provide aggregated buying power for 15 customers, and possibly reduced costs for certain products and services. Additional applications for the present invention include but are not limited to travel services (in which users and employees can plan corporate and personal travel). The employee can access and purchase appropriate transportation tickets and hotel stays. The charges are made to the employees account (such as a bank 20 account, a credit card, or a company account) and are immediately credited or debited from the appropriate account. This eliminates the need for expense accounts and reimbursement requests, as the debits and payments are made through the present invention. On the human resources side of the present invention, company manuals, 25 company procedures, human resource services, payroll, training and insurance, among other services, can be included. Because the present invention acts as the primary bank, and the integration of the three major applications allows direct flow of information about the employees' employment status and bank information, employees can obtain immediate feedback from the banking service of the present 30 invention regarding commercial and personal loans, automobile loans, mortgages, UVV " vl/'etuyU L1i/UbUU/ZOSO 15 and even investment services. The integration of the three major applications, along with the additional applications, allows the employee to obtain almost real time decisions on such financial queries. Additional applications include automatic SEC filings for the company users, 5 automatic tax reporting and payment for both company users and individual users (including employees). Other additional applications will be apparent to those of ordinary skill in the art. It can be seen that the present invention provides most, if not all, services a company or individual needs from one source. There is little initial cost to get the 10 best and most up to date product available. Monthly charges increase the economic viability of the present invention by eliminating high up front fees and allowing the customer to select and pay for only those applications desired or needed. The present invention can grow with the needs of the customer in this same way. 15 The user can visit the web portal of the present invention to start a new business. Available applications for this type of service include information, including links to the appropriate service providers, about incorporating the business and marketing the products ands services, ordering equipment and furniture, and obtaining accounting, banking and payroll services from one source. Available 20 applications for existing businesses include the services mentioned above, and the added benefit of being able to add acquired businesses or new offices to the accounting, banking and payroll system, ease of access to all pertinent information by employees, ease of consolidation and dissemination of reports, as all major applications are integrated, and best of breed processes. 25 The above detailed description of the preferred embodiments and the appended figures are for illustrative purposes only and are not intended to limit the scope and spirit of the invention, and its equivalents, as defined by the appended claims. One skilled in the art will recognize that many variations can be made to the invention disclosed in this specification without departing from the scope and spirit 30 of the invention.