Make the Most of Your Purchase to Pay Process
Essentially every business, regardless of industry, manages a Purchase to Pay process. For financial departments, Purchase to Pay is common knowledge, but those in other areas of business might struggle to understand this process in its entirety. Also called ‘Procure to Pay’ and more commonly referred to as P2P, Purchase to Pay is the process of events which occurs in a business between the purchase of goods and services and the payment of an invoice.
From purchase requisition to purchase order, delivery confirmation and final payment, P2P is a document-intensive cycle and involves the proper management of detailed paperwork including checks, invoices and proof of deliveries (PODs), among others. A critical cross-functional process, various people and departments are involved, making paper-based Purchase to Pay initiatives time-consuming and highly inefficient.
Are you making the most of your P2P process? Advanced content management solutions streamline P2P process automation, simplifying workflow, saving an organization time and money, while also avoiding the potential of data error due to manual intervention. Meanwhile, users are provided with excellent visibility into P2P processes to eliminate questions like, “Has this invoice been approved yet?” or “Was the delivery made?”
Reflect on your organization’s end-to-end paper processes. Is a paper-based workflow efficient enough to keep up with business growth? Gain control and simplify P2P by going digital. Consider the following three questions to determine if your business can benefit from creating a streamlined, more effective Purchase to Pay workflow.
Is your customer, supplier and vendor data current, clean and controlled?
Most organizations have trouble keeping master data up to date. If billing or invoice information is not clean or well managed then business efficiency and liabilities are at risk, potentially driving up internal costs. Valuable employee time can be wasted searching through archived paper files, switching between business applications and contacting partners for the appropriate information. Save processing time and costs by putting into practice a systematic approach to managing data.
Leverage the full power of Enterprise Content Management (ECM) by integrating with existing business platforms to streamline document-centric processes and create automated workflow between programs. This in return, reduces a significant labor cost for matching and coding invoices, as data is synced between a CRM platform such as Salesforce.com, or accounting platform like QuickBooks®, and the document database for streamlined indexing capabilities. ECM integration enables users to achieve the benefits of digital business including rapid results, lower costs and a better customer experience.
Are you frequently receiving late payments, causing your DSO to run high?
Offer instant access into P2P transactions to provide customers visibility into their specific order process, reducing questions, time spent addressing these concerns and the risk of receiving duplicate payments. If you make it easy for external users to engage with your P2P process then you will gain additional insight on how it can be improved. By empowering outside recipients with selective access you are encouraging self-service, which allows your employees the ability to repurpose their valuable time. Organizations can then implement real-time discounting for early payments to reduce DSO numbers.
To make life easier, the award-winning GlobalSearch ECM software offers a convenient web-based interface, allowing System Administrators to easily set and edit permissions so non-network users can access documents maintained within the protected environments of SmartSearch. This includes the ability to give secure access to external users, like vendors or customers, to provide real-time validation of submitted invoices, purchase orders and PODs. By centralizing invoice processing into one single location, the quality of business information and reporting is improved. Outside users will enjoy having greater visibility of processing times, and it may improve their perceptions of your organization. Automated solutions can simplify end-to-end processes to make a customer’s buying experience simple and intuitive.
Has poor internal collaboration damaged customer and vendor relations?
ECM software makes it easy for submitted purchase orders, invoices, packing slips or delivery receipts to be accessed across an organization from a desktop program or through the web. Any users with the proper permissions can log in and view entire Archives of documents from their individual workstations. Employees can then transact in an automated fashion through the help of document workflow.
Business users can perform real time validation of captured documents by creating workflow processes. Automated workflow functions will systematically carry a document from capture, to managerial approval to distribution and final archival. Plus, in the event that a three-way match fails, the workflow provides where a document was last and who accessed it, while also calling on the appropriate person for action. Additionally, submitting documents through web form generators, like GlobalForms, will trigger and automatically enter a designed workflow to ensure efficient collaboration across departments and fast invoice automation processing. Gaining cross-departmental support of the P2P strategy immediately eliminates internal errors, miscommunication and time-consuming inquires during processing.
A streamlined Purchase to Pay process can help organizations reap enormous efficiency savings to better manage working capital. According to a 2013 study by the Aberdeen Group, focusing on a systematic P2P process can reduce AP costs by as much as 93% while saving upwards of $800,000 annually in processing company-wide. Implementing an ECM solution can improve cash flow, reduce inappropriate spend and help drive additional revenue.
Build visibility and control across your entire organization to move business forward. Enterprise Content Management ensures P2P efficiency by making your data work for you. For more insight into how Purchase to Pay automation can save your organization time and money, contact Square 9 today or visit https://www.square-9.com/business-applications/ap-automation/ .