What’s it all about?
Procure-to-Pay, Purchase-to-Pay, P2P, eProcurement — whatever name you want to give it — is a series of coordinated and integrated activities designed to fulfill the requirement of getting the right goods or services, in an efficient manner at the right price, at right time. You got this, right?
P2P is a process that involves a number of steps that must be executed in a strict order, and goes something like this:
Identification of a need (i.e., someone in the business saying “Hey! I need something to do my job!”) which then gets communicated to their boss or the budget holder, who says, “OK, you can have it!”
When the request gets approved it’s then flipped over to a PO, or Purchase Order, which creates a formal contract with the supplier to request the identified need, and which in turn may cover a number of pre-agreed terms such as delivery, price, payment, etc.
This document is sent to the supplier, who then sends the goods (or delivers the service) which are received by the requestor who then often promptly receives an invoice from the supplier.
The invoice is matched to both the PO and the goods receipt, and away we go to give the nod to our friends in accounts to pay the supplier accordingly.
Sounds easy right?
Well, imagine, you’ve been doing this with a medley of spreadsheets, emails, phone calls, handshakes, nods, or even a myriad of antiquated or disjointed technology. Or, um…. heaven forbid, something goes wrong along the way…. hmmmm…..Not so easy now!
What are the main problems still facing organizations without an eProcurement solution in place?
Paystream asked 400+ orgs to identify current trends in procurement management. Of course, orgs without a cloud based Procure-to-Pay system identified their main challenges as follows:
How can we tackle these problems in an easy-to-digest way, that sticks? The trick is to make the process show tangible benefit for all parties involved. Not just your end users and your procurement team, but your IT, finance, management, and dare I say it…. your suppliers, too!
Here are some key easy benefits that you can introduce for starters:
- Easy-to-use, intuitive catalogues that point the end users in the right direction to buy the right items at the negotiated price — so no training required!
- Easy approvals for your managers, from any device at any time!
- Easy-to-track order process and dispute management for all parties involved
- Easy-to-monitor purchasing against prepared terms, pricing and budgets — no more routing through folders of contracts to see if an order complies (if that even happens?)
- Easy-to-get quick quotes for off-catalogue items
- Easy communication with your suppliers, who have process visibility and feedback!
- Easy integration with your existing ERP or technology landscape — IT will be happy!
Now that you have a better idea of what the P2P basics are all about, watch our on-demand webinar — The P2P Starter Kit — to get the full lowdown on how you can possibly reduce the cost of processing a PO from an average of £72/$90 (for those without any procurement technology at all) to £24.50/$30 per PO, just by implementing a cloud-based eProcurement solution.
If you’d like to see how our procurement solution on the Determine Cloud Platform can help you achieve the process efficiency that helps reduce costs, maximize savings and creates sustainable impact, schedule a personalized demonstration.