Aligning your digital P2P strategy to your ‘post COVID-19’ business environment (Introduction)

Companies’ plans and the markets' demands for procure-to-pay process digitization have accelerated and evolved over the last five years, but that change is nothing compared to the COVID-19 disruption seen in the first half of 2020.

The coronavirus crisis made all organizations react and rethink the pace of their digital transformation strategies, which now often must be carried out in months rather than years. As we say in Mexico, "El miedo no anda en burro" or "fear does not ride a donkey,” which means it hits you fast.

Digital transformation (in this case for P2P processes) must now take place ASAP — especially if you’re trying to match invoices back to manual contracts that are sitting in the deserted office! Organizations can no longer think that situations like COVID-19 will never happen again, and businesses that do not digitize their processes now will not be able to compete or even survive.

But to have a great P2P digital strategy, there is more to understand. The changes that businesses are facing are not just about those caused by COVID-19; it is about those forces that are magnified by COVID-19: geo-political accommodation that is happening in the world, the change of global powers, oil prices, gold, the U.S. dollar volatility, social responsibility, global sustainability, global supply chain risks, security.

All of these and other factors greatly affect "B2B procurement" — and we intend to discuss what can be done about it.

The goal of this Spend Matters PRO series is to support buying organizations with a list of key questions (and potential answers) to build a solid and holistic procure-to-pay digital strategy. I will outline 10 major business requirements within the current environment that require strong P2P capabilities. I will then highlight 13 critical digital P2P capabilities that support these requirements.

P2P becoming central to meet key business demands

P2P solution providers know that today is the perfect time for procurement to generate value for a business because COVID-19 has disrupted supply chains (see our Coronavirus Response series here) and the crisis has shown that P2P activities have become central to keeping businesses' operations on track, efficient, financially healthy (and keeping suppliers healthy too), and protected from risk/fraud. P2P is obviously more than just issuing POs and processing invoices, but also includes capabilities (described in great detail in our SolutionMap vendor rankings) such as:

• Integrating e-procurement, e-invoicing and e-payments processes with each other and also to upstream sourcing and supplier management processes.
• Keeping spend under management, in compliance, optimized and risk-free (e.g., supporting category management objectives)
• Supporting effective cash-flow planning, monitoring and “optimization” (e.g., with supply chain financing possibilities)
• Strengthening suppliers collaboration and relationship management as everything is becoming virtual

These business demands are core focus areas for companies. And there are new ones — but let's first illustrate how a changing business environment, a constantly evolving global organization, an ever-growing and more prepared competition that pushes to keep innovating, etc. are making all these demands continuously evolve. They are creating a more complex P2P scenario for all organizations that the P2P strategy and solution providers need to support to keep businesses’ eyes on the prize.

Just as an example to illustrate how business demands are evolving, let’s consider this: Not long ago, the most important topic in B2B procurement was to achieve e-procurement user adoption in order to increase spend under management. Vendors such as BuyerQuest and Coupa came up with an Amazon-like user interface, which became the most important e-pro feature to have.

Today that is not enough.

Now the UI is more about having the user experience (UX) not just delight the users, but now includes “pathing” them on intelligent workflows — and this intelligence keeps evolving and improving. The changing business environment keeps ratcheting up new demands for P2P processes and the value they need to create. It’s not an easy task to meet those demands, but it is possible with today's emerging technologies and system's integration platforms.

In the rest of this Spend Matters PRO article, I will discuss the business issues/requirements that P2P leaders need to satisfy in order to align with them and deliver P2P value, and then use this to discuss the critical P2P capabilities needed to support them. Only then can these leaders (and supporting solution/service providers) align their digital capabilities to them as well.

In future analyses, we’ll dive into these specific capabilities, link them to business pain points (and ROI and business cases), and detail what digital strategies and providers can help implement them.