Supplier Enablement/P2P Roadblocks — E-Invoicing/Electronic Invoice Presentment Payment (EIPP)

This is a post of within a broader series looking at supplier enablement and P2P roadblocks. The material is based in part on our recent research paper: A Foundational Look at P2P Technologies. The paper can be downloaded for free via the above link.

If a P2P historian were to examine the annals of ERP technology history, they would likely conclude the biggest mistake SAP and Oracle made earlier on relative to Ariba was not developing a closed-loop electronic invoicing capability of their own design that did not require either significant third-party involvement or onerous, EDI-like integration. Granted, both vendors have moved down the path to remove e-invoicing from becoming a permanent roadblock, but they still have a long way to go in developing or acquiring homegrown capabilities to deliver a complete solution in the area (buying Basware is such a natural fit for both; I'm surprised it hasn't happened yet).

Regardless, the majority of first-generation eProcurement and P2P tools made little or no effort at driving true electronic invoicing that included the ability to configure and deploy complex invoice workflow, matching, approvals and overall process management to improve linkages between procurement, payables (AP) and treasury. One of the challenges here is that becoming a top performer in this area requires a means to electronically exchange business documents and information with an entire supply base -- not just an organization's top suppliers. By nature of their deployment approach, SAP and Oracle still tend to focus eProcurement deployments on a relatively small number of suppliers. But true P2P enablement requires going beyond the 80/20 rule of enablement, factoring into account the need to lower the integration barrier for all suppliers regardless of size, addressing the needs of large, middle market, and small suppliers alike.

Ariba, Rearden/Ketera, Coupa, Verian, Proactis, b-pack and other best of breed providers have their own means of solving the EIPP question as part of an eProcurement roll-out. But to address these shortcomings in their own solutions, SAP and Oracle have partnered with Open Text and Transcepta, respectively, in addition to providing partial solutions within their own procurement suites. Yet ERP customers should not limit themselves to these recommended options. Many SAP customers also use Hubwoo (a SAP partner), a solution that has broader capability than Open Text in the area. Others use IBX/CGE&Y, another SAP partner. In addition, Basware, which many analysts and observers consider to have the strongest invoice automation solution, has extensive experience with enabling the EIPP and connectivity process within complicated SAP and Oracle environments for both high and low volume suppliers.

Regardless of whom you work with for basic electronic invoicing enablement, don't delay! Consider it a core part of any P2P roll-out. And while you're at it, make sure the solution you enable can work for a range of direct materials and services suppliers who might fall outside the traditional P2P indirect buying purview.

Jason Busch

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