Due to current economic challenges, more and more businesses are turning to cloud technology solutions to enable business continuity and financial control. Procure-to-pay (P2P) software is in high demand to provide the efficiency and cost control vital to every business in today’s constrained economy.
Procure-to-pay, or P2P, is defined as the process of requisitioning, purchasing, receiving, paying for and accounting for goods and services. Procure-to-pay software offers an automated workflow that requires little manual attention, thereby cutting resource costs and speeding up processes with minimal impact to your current setup. With so many solutions out there, it’s easy to become overwhelmed when choosing a P2P solution to suit your business.
The DNA of a robust, efficient P2P system is made up of a variety of functionalities and efficiencies. No two solutions are identical, even if they offer the same outputs. As businesses scramble to find the best procure-to-pay system to streamline their procurement and PO process needs, what questions should you be asking when selecting the right solution for your business?
How to identify the best procure-to-pay software for your business
There are a few features that every business needs, that make up the proverbial “nuts and bolts” of your requirements.
Can the procure-to-pay solution integrate with your existing software stack?
The P2P solution you choose needs to easily integrate with your current setup and essential third-party systems. With the ever-changing nature of the business world and supporting technologies, your selected P2P software will have to be flexible enough to integrate with your current software stack, and any SaaS solutions you may deploy at a later stage.
It’s imperative that all planned or proposed integrations should be API-driven to ensure support for ERP upgrades, as well as acting as a support for any ERPs you may consider in future, as your business grows. This is where cloud-based systems stand apart, for both ease of integration and application flexibility.
A lackluster P2P solution will offer few or clunky integrations and end up costing you more, as you struggle to find partnering software. There’s immense value in purchasing hardy software that offers you the best solution for today, tomorrow and beyond.
Can you derive spend analytics from the procure-to-pay software?
Make sure the suggested procure-to-pay system offers you a variety of analytical insights. It’s essential that the data garnered from this software is easily accessible, so that it may be used to drive astute business decisions. The analytics and resulting insights from procure-to-pay software can give you an in-depth look into the behavioral spend activities of your business. The data will help you to easily identify gaps in your efficiencies too, indicating problem areas and risks that need to be addressed.
Consider the bulk data your business churns out and picture it neatly categorized in a bar graph, or pie chart. A sophisticated procure-to-pay solution can offer the user a view that is as segmented or as granular as needed. Segmentation allows you to group your various types of analytics, aids in setting up dashboards, and offers the much-needed business insights into budget or risk factors. These insights pave the way to better business decision-making.
Here are the types of invaluable data you should access from your P2P software solution:
1. Spend analytics: Visibility is key to understanding how your business spends money and identifying saving opportunities. Choosing an efficient spend management solution means purchasing data is both clearly and concisely represented, giving your teams immediate insights to drive the right course of action.
2. Vendor analytics: Accurate vendor analytics will allow your teams to track spend with vendors, purchasing frequency and vendor performance. The ability to analyze and generate reports will provide the data necessary to leverage negotiations to potentially qualify for discounts or more favorable terms.
3. Reports: Your procure-to-pay software needs to easily generate reports at the click of a button. Real-time data should be represented as clearly and simply as possible, to allow for a quick and easy snapshot of summarized information.
Can you reduce the requisition-to-purchase order cycle time?
Perhaps one of your most important concerns regarding procure-to-pay software is its purchase order (PO) or purchase request (PR) functionality. An efficient P2P solution can reduce your purchase order processing time by as much as 70 percent.
Mobilizing and digitizing your purchase requisition and PO process means submitting and approving new requests is quickly and easily completed, with policy compliance and controls in place at each step in the purchasing approval workflow.
The procure-to-pay solution you choose must ensure a smoother, automated workflow that eliminates delays and minimizes human error.
Procure-to-pay software will simplify your entire PO process by offering you the following features:
1. Paperless processing: Forget having to print out another PO, as all your data is saved and backed up to the cloud, freeing up time to efficiently manage your purchasing orders at a glance.
2. Cloud storage: Your P2P solution should safely and securely back up all your documentation to the cloud, allowing for easy retrieval whenever needed.
3. Mobility: Being able to access your P2P software anywhere, at any given time, on any device, provides instant tracking and approval of POs.
4. Alerts: Timely, automated alerts assist in keeping your teams up-to-date on the status of every purchase order. These alerts additionally drive compliance with policy and procedure, ensuring your teams consistently remain within regulation and on budget.
A P2P solution worth its salt will help offer transparency and visibility on the status of your purchase requisition, while simultaneously offering you complete control. Define and manage your budget restrictions throughout your procure-to-pay life cycle, and get immediate access to all your product or PunchOut catalogs when initiating your purchase requisitions.
Purchase requests should be streamlined, along with these essential functions:
1. Purchase order generation: Quickly and easily generate POs as soon as requests are approved. Purchasers should have the ability to submit orders individually, or to consolidate numerous orders to the same supplier prior to generating POs.
2. Requisitions to RFQ: Transferal of purchase requisitions to new requests for quote (RFQs) should be easy, automated, and should notify the relevant users of the next steps required.
3. Approval workflow: With a reliable purchase requisition approval workflow configured in your P2P system, you can rest assured that financial control will prevail. Escalating levels of approval, based on roles or request value, ensure that all costs are authorized before they are incurred.
4. Mobility: Like your purchase order feature, mobile and multi-device functionality means a flexible P2P solution lets your stakeholders approve or reject requests, or ask for more information on-the-go.
5. Intuitive platform: An intuitive interface and ease of use ultimately drives user adoption, which is a critical factor in whether or not your P2P investment is a success.
How easy is it to find and match your invoices using the P2P system?
Invoice matching has been known to be the bane of many a business. With procure-to-pay software, this should no longer pose a problem.
1. Three-way matching: With automated three-way matching, your invoices are linked to requests, POs and goods received notes (GRNs), eliminating the risk of duplicate payments.
2. Integration and invoicing: Seamless integration means that your P2P connects directly with your finance system. Be it Sage, Quickbooks, Acumatica, Microsoft Dynamics, SAP or others, integration allows for faster invoice approval and processing.
Creating a harmonious ecosystem of software tools that are able to interact seamlessly, allows you to be as flexible as needed when facing business growth. A solution that scales with your business is integral to remain agile, while saving you both time and money.
The features above need to provide time-saving automation, reduce purchasing cycle times and invoice processing costs, ensure accuracy and control, while streamlining the entire procure-to-pay process.
At its core, these are the most essential markers to identify if your choice of procure-to-pay software will assist your business by improving efficiency and control. Functionality speaks volumes; make sure these boxes are checked when selecting your P2P solution.
Reach out to our team for spend management advice; we’re mindful of the challenges facing every business in the current economic climate.
Fraxion is a proven solution provider of cloud procure-to-pay solutions, request a one-on-one demo