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Implementing a Cloud-Based Purchase-to-Pay Solution to Streamline Operations

With several innovative cloud-based software solutions designed specifically for the Purchase-to-Pay process area now available, companies have the opportunity to leverage advanced functionality without a large IT investment or a complex implementation project.  Such providers as Ariba, Coupa, and Taulia are growing rapidly as companies continue to migrate to these extremely powerful and flexible solutions, and the trend is expected to continue for the foreseeable future.

During a recent Peeriosity PeercastTM, a major global consumer products company shared their recent experiences in implementing the Coupa Procurement and Invoicing products, including specific details about the benefits and challenges of the implementation and the ongoing use of these software solutions.  This company processes more than five million invoices per year, so it would be a major challenge for any solution provider to support that large and complex of an organization, both from a flexibility and scalability standpoint.

Prior to their Coupa implementation, this company’s Purchase-to-Pay (P2P) technology was not designed to work in an integrated manner across the end-to-end process of sourcing, contract management, order management and payment processing, resulting in value leakage and manual effort across all stakeholders, including end-users, suppliers, Sourcing, and P2P Operations.  User feedback was not good, with concerns about the existing technology not being intuitive and having limited system functionality and multiple work-around processes which resulted in diminished controls and user frustration.  With internal comments like that, the prospect of having one platform and one environment that integrated Sourcing, Procurement, and Invoice Processing workflows between the company and its suppliers was very appealing to this P2P organization.

One key component of the successful implementation of Coupa at this company was the need for it to interface as seamlessly as possible with their primary ERP system, SAP.  The Master Data file in SAP was the source of all the information Coupa needed to carry out all the Purchase-to-Pay activities and then to keep the purchase order, goods receipt, invoice receipt, and invoice payment information updated in SAP upon completion of a transaction.

Some of the benefits realized by the feature company after six months of going live with Coupa include the following:

User

  • Allocations via web-forms and catalogs increased from 10% to more than 35% of orders
  • Requisition to PO cycle time is about 19 hours, down from ~2 days
  • PO changes went from over 50% down to 12%

Buyer

  • Compliance driven to pre-existing allocations through increased visibility
  • RFx tool available for quick, integrated spot buys
  • Integrated visibility to payment status/tracking

Supplier

  • Now have an electronic PO and invoicing process. Can receive POs via email, CSN, or cXML and submit invoices via the same. e-Invoicing is up from 20% to over 80%.
  • Visibility of invoices/payments via CSN
  • Streamlined payment terms
  • All these electronic facilities at zero cost to the suppliers

Looking now at the results of a poll generated in conjunction with this PeercastTM using Peeriosity’s iPollingTM functionality, 47% of the surveyed companies have either implemented (29%) a cloud-based solution within Purchase-to-Pay or have approved doing so (18%).  This is on the radar screen of another 23% of the companies as they are currently carrying out the evaluation of this technology, while 24% have not yet evaluated it.  Just 6% conducted an evaluation and decided to not proceed with implementation.

The second iPollingTM question then addressed the likelihood of the surveyed companies implementing a cloud-based P2P software solution over the next three years, with the results showing strong interest in this type of solution as a part of their future technology strategy.  With 30% having already implemented this technology, another 52% of the companies responded that a future implementation is either very likely (23%) or somewhat likely (29%).  Just 18% of the companies participating in this research said that it was not very likely that they would be adopting this technology within the next three years.  Based on these results, it appears that the cloud-based software solution is in the process of transforming Purchase-to-Pay at a majority of the large companies across the globe.

What is the status at your company with respect to adopting a cloud-based Purchase-to-Pay solution?  Is this part of your long-term strategy to continue to transform this critical aspect of your operation?

Who are your peers and how are you collaborating with them?

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“PeercastsTM” are private, professionally facilitated webcasts that feature leading member company experiences on specific topics as a catalyst for broader discussion.  Access is available exclusively to Peeriosity member company employees, with consultants or vendors prohibited from attending or accessing discussion content.  Members can see who is registered to attend in advance, with discussion recordings, supporting polls, and presentation materials online and available whenever convenient for the member.  Using Peeriosity’s integrated email system, Peer MailTM, attendees can easily communicate at any time with other attending peers by selecting them from the list of registered attendees. 

 “iPollingTM” is available exclusively to Peeriosity member company employees, with consultants or vendors prohibited from participating or accessing content. Members have full visibility to all respondents and their comments. Using Peeriosity’s integrated email system, Peer MailTM, members can easily communicate at any time with others who participated in iPolling.

Peeriosity members are invited to log into www.peeriosity.com to join the discussion and connect with Peers.   Membership is for practitioners only, with no consultants or vendors permitted.  To learn more about Peeriosity, click here.



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