2013 Prediction: Another Good Year for Purchase-to-Pay Automation
Spend Matters welcomes a guest post from Mark Schaffner and Shannon Lowe of Verian.
"At the 30,000-foot level, the world's economy appears as stormy as it's been since the financial crisis blew over." - Money Magazine, January 2013 tweet
Bad economic news translates into strong demand for purchase-to-pay solutions. According to experts, 2013 promises to be another tough financial year for everyone, with no easy relief in sight.
That means purchasing and AP managers are being asked to find new ways to save their companies even more money. While reading a recent analyst report, I came across this selection of good ideas:
- Choose procurement solutions that include multi-enterprise support to consolidate spending more easily from affiliated organizations
- Invest in tools that improve visibility into spending and provide the analytics needed to prioritize savings opportunities and right-size improvement investments
- Lay the groundwork for automated contract compliance
- Implement a user-friendly e-procurement solution to guide employees to negotiated agreements
If one of the above suggestions shows promise, a question about the ROI of such a project will likely come up. Instead of getting worried, think of the ROI framework as a series of questions about four key issues: Benefits, Costs, Risks and Flexibility. The money man will most likely want to know the following:
- How will the system increase our cash flow?
- How will the system increase our efficiency?
- Will we gain any strategic capabilities?
- What must we pay for a system?
- What is the timing of these payments?
- How much internal time will it take to implement?
- How certain are the benefits relative to cost?
- Are there any proven strategies on reducing risk?
- How can we be sure that the product meets our needs?
- How well does the system meet our current needs?
- Can the system evolve to meet our future needs?
- What will be the cost if we have to change solution partners?
With this year's economy looking as stormy as it does, it is especially crucial to be prepared. Get the tools you need, as it looks like 2013 will be a volatile year.
- Mark Schaffner and Shannon Lowe, Verian