Disruptive technology is a very real situation for procurement organizations everywhere. Spend Matters analysis suggests that procure-to-pay (P2P) technologies will evolve faster in 2017 than ever before. Join Jason Busch and Xavier Olivera of Spend Matters Mexico-Latin America on Wednesday, January 25 at 10:30 a.m. Central for 2017: The Most Disruptive Year in P2P Ever?
They'll discuss P2P technology as it relates to:
My view of offline factoring models is that they're the equivalent of burning coal with turn of the early 20th century technology for power or heat when we could be splitting atoms or using wind or solar power instead. Like using coal for energy, factoring is wasteful, inefficient and generates unintended side effects. But what’s the solution, you ask? Easy.
P2P (procure-t0-pay, not peer-to-peer) carries a number of solutions to your procurement function, no matter what market or industry you operate in. With so many options to choose from, how is one to tell the superior solutions from the rest? Xavier Olivera, editor, Spend Matters Mexico and Latin America, presents this complimentary research brief to explain it all: What Differentiates a "Best-in-Class" P2P Solution from the Rest?
Spend Matters welcomes this guest post from Bill Stotzer, managing director, and Helen Van Ness, of Alvarez & Marsal.
In any size company and in any economic environment, strong management of working capital should take center stage. Why? In our opinion, it is one of the best ways to quickly improve and sustain the financial strength of your company. So if working capital is so powerful, why doesn’t it demand more focus and expertise? Simply stated, managing working capital has become a highly distributed set of competing responsibilities within the typical corporate structure, each driving to their independent objectives. We have several observations after working with our clients to implement solutions for many of these challenges.
Spend Matters welcomes this sponsored article from Sean Van Gundy, managing director, working capital advisory at C2FO.
Payment terms standardization, terms extensions, P2P automation and dynamic discounting programs are all trending topics with global corporates these days. These tactics can be effective at improving payables value, but what’s the best strategy to achieve your desired results?
In February, Arrowgrass Capital Partners, a London-based asset manager, announced it acquired Oxygen Finance. The acquisition is curious, in part because of the existing Arrowgrass and Basware partnership and Oxygen’s unique model, which we explore in this analysis. Oxygen currently has “billions of pounds” flowing through its infrastructure annually, primarily from U.K.-based public sector clients, yet it is not a P2P or e-invoicing vendor like most other providers focusing on discounting. Nor is it like C2F0, which focuses on creating loosely coupled — from a transactional systems perspective — competitive markets that provide greater flexibility to suppliers around participation compared with Oxygen. This multipart Spend Matters PRO brief delves into the Oxygen Finance solution in detail and explores a number of questions that Oxygen and the acquisition raise. These include whether or not the deal signals that additional private funds are likely to make more investments and buyouts in the sector. (Note Zouk investing in Taulia recently.) More important for users, we provide our analysis of the Oxygen Finance model, which is theoretically based broadly on a closed loop buyer network with its suppliers, and whether it might be able to gain the same type of discount scale and supplier adoption that new e-invoicing led trade financing models of the sort Taulia is bringing to market with its SCF+ are hoping to achieve through an alternative means. Finally, we analyze the days payable outstanding (DPO) and working capital impact Oxygen can have in comparison to alternative approaches — and why the public sector appears the most fertile ground for the solution approach.
Reverse factoring programs require a careful internal process orchestration that must include procurement, accounts payable, treasury and executive leadership to be successful. During an outstanding panel discussion led by The Trade Advisory’s Tony Brown at the CFA’s Supply Chain Finance/Factoring World event in Miami last week, two panelists, Kyriba’s Eric Riddle and Wells Fargo’s Stephen Elson, provided contrasting examples of what successful and poorly performing reverse factoring programs look like.
In the first installment in this series, we provided our own recent history lesson on Taulia and how it got to where it is today — and the crossroads it currently faces from a strategy perspective. As we wrap up our Spend Matters PRO update on Taulia, we explore a number of specific areas of its business today, including a deep dive into its SCF+ offering, a tech-enabled and simplified approach to reverse factoring for the long-tail supplier masses instead of just large vendors. We also explore how Taulia is currently positioning itself today as it engages customers and how, on many levels, its core offering is a Trojan horse for what it really wants to sell with partners (but why that foot in the door with procurement, IT, accounts payable and treasury is an important as a first step and how these different worlds are converging). Granted, it would be easy — and not incorrect — to observe that the broader e-procurement market and purchase-to-pay (P2P) market remains distinctive from Taulia’s core sector today. Yet going forward, one can make the case that the worlds of generic (indirect) and category-specific buying, transactions, financing and payment will come together. And this is where understanding Taulia's emerging strategy matters.
Earlier today, Hackett’s Amy Fong gave a phenomenal talk, taking the audience on a journey through a range of Hackett purchase-to-pay (P2P), treasury and payables benchmarks, KPIs and recommendations. I’ll cover a number of the highlights from the presentation in a separate post, but I wanted to share one quick highlight that jumped out at me. It’s a radical finding: In a 2015 Hackett Payment Practices Poll, the firm found that treasury departments primarily want to implement solutions “to provide supplier financial liquidity rather than direct working capital improvements.”
Cedric Bru, Taulia’s CEO, is no stranger to the world of trade financing and supplier connectivity. Just before Taulia Connect, Cedric shared with me a number of thoughts on topics ranging from Taulia’s position in the market today to the future of trade financing beyond the current world of e-invoicing, dynamic discounting and supply chain finance. We’ll feature this interview in multiple installments throughout the week, in addition to live coverage from Taulia Connect.
Even though my colleague David Gustin covers such topics in much greater detail on Trade Financing Matters, I find fascinating the early fronts that appear to be forming in the battle for lending and small business financing — beyond the traditional arms of banks, invoice discounting and card programs. The Wall Street Journal recently covered how Intuit’s QuickBooks and OnDeck are partnering to offer loans based on invoice information, receivables and other information contained within a company’s general ledger on the system.
Total cost of ownership of the procure-to-pay process is not simply about measuring the costs associated with acquiring a P2P platform, it’s about tracking all P2P processes and managing them as a business key performance indicator. Managed well, the TCO P2P KPI can positively impact the bottom line of any business. Many organizations think that when acquiring a P2P platform, a firm business case needs to be constructed based on the total cost of the platform and high-level benefits that are reasonably achievable. But there’s actually a more effective way to think about the cost and returns of P2P technology. In this Spend Matters PRO brief, we explore this new way of measuring P2P returns and cost through a modified TCO approach.