Achieving Competitive Impact in the Procure-to-Pay Arena

The continuous effort by organizations to create or maintain a competitive advantage touches on a variety of business activities and looks at both cost and revenue. The prevailing trend of Digital Transformation, seen as a way by which to convert manual or otherwise inefficient processes into advanced digital processes that remove cost and improve efficiencies, also includes procure-to-pay (P2P) interactions between organizations and their suppliers.

The challenge in selecting appropriate solutions to fulfil the need for Digital Transformation in the P2P arena, is, as always, to determine which of the myriad of solutions is best suited in terms of immediate and long-term cost, ease of implementation, continuous maintenance and support, and of course – value proposition.

The complex set of challenges and available solutions, coupled with organizational constraints, such as the availability of time and money and the presence of organizational politics and other such influential factors, cause organizations to make tactical decisions rather than strategic ones and to focus on discrete solutions instead of looking at improving overall business outcomes.

For example, implementing robotic process automation (RPA) technologies in an effort to automate repetitive manual processes and make better use of personnel, could reduce associated long-term costs and remove errors, but would more often than not cause a significant short-term disruption to the business and ultimately operate on a limited scale.

P2P is far more than just a set of highly structured, highly repetitive throughput of digitized data that can be easily automated – it is far more dynamic and complex, requiring a greater level of intelligence and varied decision-making capabilities.

To digitally transform P2P in a way that allows the organization to extract optimal business value, it would need to adopt a strategic view that accounts for both near and long-term, minimal business disruption and an attractive margin of financial benefit (low cost of implementation, long-term cost reduction, increased productivity, removal of errors and fraud, etc.). An ideal solution would be simple to integrate, allow the organization to maintain existing resources and minimize organizational change, yet offer cross-functional and multi parameter value through process automation that is intelligent enough to replace human thought.

Such a solution would make better use of personnel by allowing it to focus on the exception that arise when interacting with suppliers, which brings us to the final piece of the puzzle: any P2P process automation solution, exceptional as it may be, will be useless if suppliers do not use it to the tune of a spectacular adoption rate. For that to happen, they too must gain practical value from it – minimal barriers to implement, access to new business opportunities, better working capital management, improved payment processes and more.