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Accounts Payables Automation update (Part 2) —  Re-evaluating e-pro, supplier enablement, invoicing, payments, financing, analytics

Analytics

As Spend Matters re-evaluates the AP automation sector’s technology developments, Part 2 of this PRO analyst series will focus on the six key elements of AP automation that we evaluate for our SolutionMap’s scoring and ranking of vendor offerings. (Don't read this without reading Part 1, about re-evaluating the tech developments in AP automation.)

We saw these six areas change in 2020, so we’ll look at how the function is evolving. This post explores the technological, functional and document-level components required to automate the AP function, and it mentions the stakeholders involved.

There are likely use cases that require much more technology, or much less, than what we mention here. So give us your feedback.

In Part 3, we’ll discuss the market landscape for AP automation providers.

Accounts Payables Automation update (Part 1) — Re-evaluating the sector’s technology developments

Accounts payables is a business process with great operational workload that needs to be handled with great efficiency and effectiveness. If not done well, it might generate significant additional costs to the business and add risks like business fraud or damage commercial relationships with suppliers — all of which harm a company’s bottom line.

Although the pain points of the accounts payable process are the same today as in the past, the importance of its automation has become greater recently as businesses look for more value creation than just operational efficiencies. And that counts even more so with the arrival of COVID-19, which has shaken up the status quo of all companies’ processes.

Today, procurement technology providers have been funded with millions of dollars to create better solutions to automate this process and improve AP’s integration with other business processes, like procurement (2- and 3-way match), accounting (reconciliation), and treasury (cash flow optimization).

New technologies and the development of advanced solutions have made it possible for many more companies to have access to AP automation solutions that were previously unthinkable for an SME, and for large and global companies. Examples include the cloud, API integrations, artificial intelligence, RPA, digital payments, data extraction solutions, etc.

Therefore a year ago, we at Spend Matters started with a new SolutionMap category that compares AP Automation offerings.

However, the evolution of the AP automation solutions in 2020, and the sector’s push to include other business processes, has led us to rethink the approach we take toward the AP automation function and how we'll analyze it in 2021.

In this three-part Spend Matters PRO series, we will explain what we are seeing in the AP automation market, the components of our analytical approach and the state of the AP automation solution market.

The Contingent Workforce and Services (CW/S) Insiders’ Hot List: December 2020 ‘Special Edition’

Spend Matters has been publishing the monthly CW/S Insiders Hot List — our monthly look at new technology and innovation in the contingent workforce and services (CW/S) space — since the start of 2018. Today we are publishing this “Special Edition” to mark a change in our publishing schedule and look back at the key trends and themes that emerged over the course of this year.

For nearly three years, we have published the Hot List at the beginning of every month and covering developments of the previous month. As such, the November Hot List would cover the developments that transpired in October. To align titles and converge periods, starting next month, the January Hot List will be published at the end of January and will cover the developments that took place in January. We will maintain that convention going forward.

In this December 2020 Special Edition, we will also be looking at and discussing some of the key trends that the Hot List covered over the months of 2020. But before turning to that discussion, we will provide a summary round-up of notable events/developments in December.

The Direct Sourcing of Workers/Services (DSW/S) Solution Market Landscape

direct sourcing contingent workforce

Spend Matters Contingent Workforce/Services SolutionMaps are made up of three maps covering the main enterprise software solutions used by organizations to manage contingent workforce and services (CW/S) procurement.

These three maps represent purpose-built solutions for:

  • Temporary Staffing (solutions known originally as VMS (vendor management system) has been the key enterprise technology for over 25 years)
  • Contracted Services/SOW (solutions — whether suite modules or stand-alone — designed to variously enable the management of corp-to-corp, third party services)
  • Direct Sourcing of Workers/Services (DSW/S) (solutions designed to enable enterprises to directly source and manage independent workers and small service providers or SSPs)

This Spend Matters PRO market landscape report covers the Direct Sourcing of Workers/Services (DSW/S).

Beyond Spend Influence: Enabling Procurement’s Emerging Roles in Business Transformation (Part 8) — Beyond Continuous Improvement

This is the last of our multi-part Spend Matters PRO series on transformation, focusing not just on digital procurement transformation, but also a broader supply-aware transformation of the value chain and the business (i.e., spend management and supply management improve business management). In the previous installment, we covered:

  • How procurement can use an empathetic, but deliberate, design-centered approach to align with stakeholders and meet them where they are at their many “tables” (albeit virtually given the pandemic)
  • The importance of a well-articulated procurement mission and “brand” that coherently communicates and speaks to the business stakeholders, rather than just being a technocratic procurement strategy that simply executes a narrow value proposition.
  • Pathways for procurement to be a little more proactive and structured in its transformation approach.
  • How procurement can formally “guide” a best-practices spend/supply management process supported by technology that goes beyond tactical “guided buying” processes.

We also featured our procurement adaptation of Amazon’s flywheel (and Covey’s influence model for good measure) before laying out a five stage transformation model with embedded recommendations and emerging techniques and tools that can help on the transformation journey.

But, there is still a chapter to be written here, and it deals with the problem of “the final mile” that links the procurement strategy and transformation to the actual projects in the trenches. When there is poor linkage, here are some of the issues:

  • Individual projects are considered in isolation without looking at the bigger picture relative to strategy and to other projects
  • Steady state processes are increasingly rare in today’s increasingly volatile environment, but yet, change management is still difficult to estimate and execute
  • The use of ‘wave planning’ for prioritizing sourcing projects (i.e., plotting impact vs. effort) is a noble goal, but the technique is less widely adopted across processes, and the methodology for estimating the effort is usually fairly crude
  • Speaking of sourcing, too often, the sourcing “intake” process is fairly reactionary and tactical in nature when in fact the opportunities could be made more strategic and transformational if they were better anticipated and coordinated with other efforts
  • Too much picking of low hanging fruit projects (i.e., strip mining for savings) without building “transformational muscle” makes it harder to attempt picking the higher hanging fruit with more complex cross-functional (and cross-enterprise) projects

In this last installment, we’ll share a simple five-step transformation project evaluation and implementation process that can be used for digitally intensive projects (or not), strategic projects/programs (or incremental improvements), and for cross-project transformation roadmapping. It will utilize 15 dimensions that can be used to estimate a degree of difficulty for specific projects (e.g. to help plot that wave chart discussed earlier) or for the broader transformation.

Digital B2B platforms for work/services: Are we at a COVID-19 inflection point?

COVID-19 has impacted businesses in many fundamental ways. Perhaps most visibly, it has brought about what seems to be a structural shift from predominantly office-based work to significantly more remote work. Many large companies are shutting down entire offices, having made the decision to move to a much more remote workforce model.

Now there seems to be some evidence that COVID-19 has had a notable and positive impact on at least some B2B online work/services platforms that enable businesses and freelancers to engage and transact with one another online. These engagements and transactions can occur without spatial limitations (no meeting in offices necessary, access to a potentially worldwide talent pool).

Though not central in our focus, B2C platforms like Instacart, Grubhub and others have also gotten a boost from the surge in online ordering of everything from meals to consumer goods.

The growth of transactions across these platforms and a new law in California may add to the potential momentum.

This Spend Matters PRO brief examines if COVID-19 may be leading to an inflection point for the B2B work/services platform economy. It looks at developments over the past months, including those at the two publicly traded online freelancer platforms, Fiverr and Upwork. The brief concludes with our own views of where things stand today and what enterprise executives should expect and do.

SIG Summit: Exploring technology for SOW-based services procurement

The SIG Procurement Technology Summit, being held online this week, has been providing its attendees with an immersion in “industry trends, innovations and solutions that are shaping high-performance teams and best-in-class procurement organizations.” While procurement is responsible for efficiently securing materials, goods and services, procurement of SOW-based services may be one area in which fit-for-purpose technology is wanting. SIG was not about to miss this gap.

Procurement Leaders: Hit the Refresh Button in 2020 at SIG’s Procurement Technology Summit 

Updated April 20: SIG has provided the latest information about its summit, which is now online only to accommodate coronavirus concerns.

SIG is committed to staying at the forefront of all the forces impacting our industry. With a global pandemic forcing many to work from home, we have moved the SIG Procurement Technology Summit from an in-person event to a fully online event taking place May 11 to 15, 2020. You can join us for just a few hours each day right from your home office.

A Holiday Gift Your Team Will (Actually) Appreciate

This time of year, giving presents to your team members and colleagues can be awkward no matter how well you know them. Look beyond the restaurant gift cards, trending gadgets and dried-out fruitcakes to a gift that will deliver an actual return on investment — an industry-recognized certification. By coming together in a virtual classroom, you’ll avoid those awkward, gift-giving faux pas and delight your team with an investment in their professional development to sharpen their skills, boost performance and credibility with both stakeholders and management, and contribute to the overall success of the organization.

Tradeshift: Vendor Analysis Update (Part 1) — Background and Solution Overview

Tradeshift is a cloud platform that connects buyers and suppliers with the goal of digitizing supply chain relationships, processes and information, while also enabling everyday procure-to-pay activities. Its capabilities span the buying of goods and services through to financing and payment — and significant capability in between, especially in the invoice-to-pay area.

In addition to providing its own procure-to-pay modules, Tradeshift offers an open integration framework that allows other technology firms (and customers) to integrate and/or development third-party apps, primarily centered on supplier connectivity, transaction enablement and collaboration. Tradeshift can even integrate alternative procure-to-pay providers in cases where specific enabling capability is desired.

This three-part Spend Matters PRO analysis provides an update on Tradeshift capabilities, both as a platform-as-a-service (PaaS) provider and as an e-procurement and invoice-to-pay technology vendor.

The updates since last year's review include information about real-time collaboration; a single sign-on; centralized access to POs, invoices, etc.; an AI-assisted chatbot named Ada; buying topics about GPOs and direct materials; global support; and new sections on payments/trade financing, analytics, services, integration and technology like blockchain.

The PRO analysis is designed to provide facts and expert analysis to help procurement and finance organizations make informed decisions about whether they should consider Tradeshift for both traditional “in-the-box” procure-to-pay requirements as well as unique marketplace/platform-type digital initiatives.

Part 1 of our analysis provides a company background and detailed solution overview, as well as a summary recommended fit suggestion for when organizations should consider Tradeshift as a complement to other procurement and finance solutions. The remaining parts of this research brief will cover product strengths and weaknesses, competitor and SWOT analyses, and insider evaluation and selection considerations.

5 tips from SIG on presenting at procurement industry events

Presenting at an industry event is an important step in any professional's career. It is also an excellent opportunity to promote, showcase and reward a team for a job well done. But most importantly, it is a critical factor in keeping an industry relevant, competitive and strong. Every professional worth their salt should consider it their duty to share their successes and failures.

Of course, in order to present at an industry event, you must first submit a proposal in the form of a session abstract. Sourcing professionals are well-versed in writing business cases and category strategies, and we have all read our fair share of good and bad proposals. However, when it comes to writing a speaking proposal, many sourcing professionals don’t give it the time or energy it deserves. These abstracts are often used to describe your session, and if the goal is to share your thought leadership, you will want to make sure your abstract grabs your audience’s attention. Consider the following five tips to write a compelling proposal for your next industry event.

Defining AP Automation Functional Requirements (Part 3): Invoice Mobility, Compliance, Analytics

e-invoicing

AP automation capabilities vary dramatically between different software providers, and the capabilities a finance or procurement organization will require to support the automation of AP processes also vary materially, based not only on company size but a broad range of other factors. These include organizational complexity, invoice capturing requirements (e.g., paper, PDF, electronic, etc.), systems complexity, systems integration, industry, EDI integration/support, payment/financing capabilities, treasury integration/working capital management, geography and compliance requirements — to just name a few.

To understand how different providers stack up against these (and other) categories of requirements, the quarterly Invoice-to-Pay SolutionMap Insider report can provide significant insight. And to create a one-to-one map between business requirements for AP automation and vendor functionality capability, SolutionMap Accelerator can dramatically speed up the vendor shortlisting and selection process, even allowing companies to “skip the RFI” entirely.

This Spend Matters PRO series defines AP automation requirements from a functional perspective to put AP, finance and purchasing professionals in the driver’s seat when they evaluate the available supply market for AP automation to fit their needs (either on a standalone basis or as a specific component of broader invoice-to-pay, procure-to-pay or source-to-pay solutions). Click to see our SolutionMap rankings of vendors in each category.

Part 1 of this series investigated core invoicing requirements for AP automation and some of the criteria that Global 2000 and middle market organizations should consider when selecting solutions (i.e., invoicing set-up, paper scan/capture support and e-invoicing).

 In Part 2, we turned our attention to an additional set of AP automation functional requirements, including AP process, invoicing validations, workflow, collaboration and integration requirements.

Now, in Part 3, we turn our attention to a final set of AP automation topics: invoicing mobility, invoicing compliance and invoicing analytics.