Procurement transformation 2025: Why invest in procuretech and how to make the case – Vroozi

In readiness for our Q1 2025 theme of Procurement Transformation, which will include how to even start your digital journey, how to make the case for it, how to shape your digital roadmap and how to survive it, we have received input from some solution providers on their own customers’ journeys.

Mike Jud, Senior Director Customer Experience at P2P solution provider Vroozi, shares what their customers are looking for from their digital procurement investment.

The ROI and efficiency metrics companies prioritize when investing in procuretech

When companies that are evaluating and selecting procurement technology come to us, they are looking for the ROI analysis that shows how much they will save after implementing the solution. We provide an analysis that shows the savings they can expect to achieve when they put more spend under management and increase user adoption. The latter is a top Vroozi value proposition for customers because they can get more spend under control, more visibility and more savings (value realization). The main drivers of the ROI analysis are Spend Compliance (user and supplier compliance for value realization), Process Improvement, Price Reduction and Cash Management. The main metrics they proritize are:

• User adoption
• Spend under management (percent)
• Contract compliance
• Orders per FTE
• Cost per order
• Average lead time
• Average realized savings
• Spend on PO (percent)
• Invoice cost per invoice
• Invoice exception rates
• Straight-through invoice processing

How customers justify procuretech investment to stakeholders

When making the case for procurement tech, our customers find that savings and process efficiency are the gains that usually resonate the most. For those who do not have robust strategic sourcing to start with, the process efficiency, particularly for order-to-invoice to get the right price, will resonate most (i.e.: 2- and 3-way matching). Compliance is also a big factor for the companies that come to us. Where they don’t have large-scale adoption of current systems, or are using less controlled methods, they are looking for a solution that gives them more control and visibility into their P2P processes. Companies understand that as they get more spend under management, they will achieve the savings, and this is what ultimately wins over most stakeholders.

The biggest challenges customers face in transitioning to procuretech

The main challenge we hear from our customers is that of change management. Many companies want to put existing processes into a new P2P solution. Some still only have few people who operate in the solution to record the decisions and activities on behalf of users outside the system. So the change management becomes that of getting all users to make the decisions directly in the P2P system. Getting companies to let go of existing processes has been a key challenge; it often requires a champion in the company to put the technology in front of end users.

Industry trends and regulatory shifts driving urgency for procuretech investment

Artificial Intelligence continues to be a hot topic for new companies. On the procurement side, the interest is in the Purchase Request coding for accounting and spend categorization. On the Invoice side, the cognitive scan and capture really gets people excited about the potential to reduce manual data entry. In addition, we are capturing the invoice lines for a complete spend analysis. The AI will also match invoices with orders and code non-PO invoices based on history. So the opportunity for invoice efficiency and straight-through processing is a significant value proposition.

On the Regulatory side, tax and e-invoicing compliance are the leaders. For tax, straight-through invoice processing necessitates the right accounting on the PO. Finance departments are looking for ways to improve tax identification on the buy side, particularly when multiple regions or cross-border transactions come into play. For e-invoicing country compliance, more countries are adopting the clearance model for tax revenue accuracy. Existing companies are increasing compliance or changing compliance rules. Companies are looking for a P2P solution to keep up with the changing rules for e-invoicing country compliance.

Many thanks to Vroozi for sharing this insight with us.

Members can read our in-depth analysis of Vroozi’s solution here.

As always, reach out to discover how Spend Matters can help with your procuretech ambitions for next year.

Consult TechMatch – our tech selection tool that helps procurement and finance technology buyers quickly explore the market and identify best-fit solutions.