Miss our webinar featuring Forrester? Read on for the re-cap and view the on-demand version.
We recently hosted a webinar with Duncan Jones, VP, Principal Analyst at Forrester. He shared survey results on:
Goals and initiatives that many companies now have in common,
How procurement automation can impact these goals, and
Case studies to illustrate how organizations are using it.
What are companies trying to achieve today?
Many organizations share several common goals as priorities. While there are multiple strategies that organizations can use to reach these goals, procurement automation can impact several of them at once — improving the ability to innovate, achieving better compliance with regulations, improving employees’ and business partners experience with the company
What’s stopping them?
Innovative companies are using automation to streamline processes and free team members to focus on more important work. The fact is that digital products and services require digital ecosystems. Without efficient automation, your organization won’t have access to the best suppliers, since outdated business processes deter innovative suppliers. Also, compliance controls are ineffective if your colleagues ignore them, which could be a serious liability to the company.
So, if purchase-to-pay automation delivers such significant impact, why aren’t more organizations implementing it? There are a few reasons.
Procurement is low priority for investment — Many organizations simply don’t realize the potential that procurement automation has, so it doesn’t receive a sufficient budget allocation.
Fragmented or inflexible business application – Some organizations aren’t sure how to integrate automation into their business operations.
Can’t trust data – Many organizations don’t have reliable data sources due to team members bypassing systems that are inefficient, so data isn’t getting recorded properly.
Operational tasks consume time – It’s a catch-22 situation: purchase-to-pay automation would reduce time spent on operational tasks, but implementing a new system gets put off because staff time is consumed by these tasks.
If you have ownership of an initiative, you’ll need to make the case for how purchase-to-pay automation can play a key role in innovation. Delving into the following factors will help you get others onboard.
1. The Importance of Visibility
Visibility is essential for an organization to operate at its potential. Flying blind causes waste and holds back the organization. Here are a few things to consider:
Invoices should not be surprise liabilities — The organization should know exactly what it owes at any point in time. When staff bypass inefficient procurement processes to save time, the organization suffers. Even if the individual expenditures are small, they can quickly add up.
Identify and manage profligate colleagues — With procurement automation, you can quickly identify which team members are bypassing the system.
React faster to component price changes — When pricing changes, your organization needs to know. Maybe you can negotiate, maybe you need to look for another supplier, or maybe you need to pass the price increase along to your customers.
Fix problem projects before it's too late — The reality is that projects sometimes run over budget due to changes in scope. But when projects go too out of bounds, problems are generated. With procurement automation, you can immediately identify when a project is becoming an issue.
Visibility Case Study: Healthcare Provider Struggles With OCR
One healthcare provider that Forrester studied provides an example of why visibility is so critical. In this case, high levels of paper invoices were being used, due to insufficient use of e-procurement. The organization was using outsourced invoice scanning to address these paper invoices, rather than automating processes with a purchase-to-pay solution. As a result, service level issues were delaying visibility of spend. Managers could not react quickly to problems, and suppliers were having to re-submit invoices.
2. Achieving User Adoption
e-Procurement adoption should be a win-win for your organization and for your team members. To encourage your people to use the system, make the right way easy and the wrong way hard.
Implement easy-to-use e-procurement software that enables colleagues rather than delays and restricts them.
Demonstrate the need to protect customers from supplier-related risks and for immediate visibility of liabilities.
Continually refine processes to create pre-authorization of all spend.
Implement repercussions for “surprise” invoices.
Modern Purchase-to-Pay Software Eliminates Adoption Barriers
While older technologies were often difficult to use, modern Purchase-to-Pay software has built-in features that encourage user adoption. For example:
Supplier upload of catalogs and/or punchout support
Easy integration with multiple suppliers
User interfaces that reduce the need for end-user training
Smart forms and process templates to accelerate implementation
A SaaS platform that makes it easy to refine your implementation over time.
3. Emerging Technologies like AI
One of the biggest barriers to adoption is fear from employees. Team members sometimes believe that automation will make them obsolete, resulting in the loss of their jobs. But emerging technologies that support automation – specifically AI – have the ability to create more jobs. AI expands users’ knowledge, processing power, and collective intelligence, making them more valuable. It automates repetitive tasks so humans can focus on more important work. It also applies human-generated expertize at scale to big data sets, a valuable task that requires human expertize.
You can also replace manual approvals with automated validation. According to Forrester’s research, managers admit that they fully check less than 10% of transactions. They rely on others in the approval chain, which doesn’t always work, and they can’t get sufficient data within a mobile app to make a well-informed decision. Managers could, instead, use validation rules and exception reports to cut manual approvals.
How a Consultative Partner Improves Purchase-to-Pay Automation
After Duncan Jones presented Forrester’s findings and recommendations, Mike Jasper, Director of Network Development at Basware shared how Basware is innovating in e-procurement and AP automation, using a consultative approach to helping customers meet strategic goals. Here are key takeaways:
1. A Consultative Partner Enables 100% Invoice Capture
You’re losing major efficiency and visibility if you’re not processing all of your invoices electronically. Your purchase-to-pay solution should be able to capture and process 100% of your invoices – paper, electronic, EDI/XML, PDF, etc. – covering direct, indirect, PO, Non-PO spending.
2. A Consultative Partner Ensures 100% User Adoption
Employees will adopt an e-procurement solution if it makes their jobs easier. When nothing is being held up due to approval delays and when time is being saved, people are less likely to go outside the system for purchasing. A consultative partner understands the intricacies of procurement, but also gets that end users should be shielded from having to understand those details just to order the goods and services they need to do their jobs.
3. A Consultative Partner Facilitates 100% Spend Visibility
A consultative partner gets global commerce – that’s why Basware Purchase to Pay operates over the world’s largest open business. Connect once, and you can then conduct business with all partners in the network. It also connects to other networks, expanding your reach. It’s built for all levels of supplier sophistication, so it doesn’t matter if they are sending you paper invoices or emailing PDFs — all invoice types are automatically converted. The process is frictionless for suppliers to be on the Network, encouraging supplier adoption. In the end, you get 100% spend visibility by having a way to capture all of your invoices and employee spending.
A Consultative Partner is Focused on YOUR Success
But it’s not just about the right technology; a consultative partner should be invested in helping you succeed with support for change management and on-going continuous improvement. Basware’s team of business consultants helps businesses achieve success and establish priorities by conducting a 360-degree assessment, providing a benchmark and tailored improvement plan to reach the highest levels of purchase-to-pay maturity. When you implement a Basware solution, you not only benefit from the ROI that the latest technology has to offer, you also work with an experienced team who will help you apply automation in the most effective way possible.
To hear the full discussion, watch the on-demand webinar.
Ready to see how you can reach your goals with procurement automation and a consultative partner? Contact Basware.