Procure to pay (P2P) sounds fairly mundane, but it is an important process within finance, supply chain and any other department that conducts large numbers of transactions. An efficient P2P process keeps business operations running smoothly, but inefficient P2P negatively impacts a company’s bottom line and employee productivity.
P2P, as the name implies, is all about procurement: purchasing parts needed at a manufacturing plant, using and paying caterers and AV teams for events or keeping an office stocked in staples and coffee. Whatever the procurement, the accounts payable team is often left to manage a process involving multiple departments manually inputting data from purchase orders, invoices and shipping documents as well as being responsible for approvals and issue resolution.
But that traditional situation is not optimal, and by addressing the inefficiencies in the P2P process, companies can reduce costs while allowing employees to focus more on strategic initiatives instead of menial tasks.
In the most basic terms, P2P has four steps:
Step 1. Reactively selecting products and services to purchase, making internal requests and communicating with the supplier
Step 2. Reviewing and approving requests to create a purchase order
Step 3. Receiving orders and matching inventory with purchase orders
Step 4. Approving and processing invoices and reconciling payments
While those four steps sound simple and may not seem like they could have a significant impact on a business’s strategic initiatives, they certainly do, especially considering that each step impacts every level of an organization. If a supply chain is reactive to inventory needs, it impacts manufacturing productivity, customer experience and revenue recognition. If employees are reactive and performing repetitive, low-value tasks, such as data entry and correction, they cannot focus on higher-level tasks, leading to missed opportunities. That’s where Robotic Process Automation (RPA) comes into play. RPA can automate an end-to-end P2P process without major investment by eliminating nearly all manual tasks, including:
- Inventory management
- Purchase requests and approval
- Purchase order creation and transmission
- Purchase order, invoice and shipping document matching
- Invoice routing and approval
- Data entry
- Transaction booking
With these manual tasks come documentation and data entry errors, delays in processing and approvals, double payments, missed payments and low productivity levels for staff, all of which lead to higher operational costs, decreased cash flow and tenuous supplier and vendor relationships. A good RPA implementation makes the P2P process more efficient and systematic. RPA processes can be quickly implemented and have been proven to reduce the need for human intervention by 95% AND decrease the time to resolve issues from 30 minutes to 90 seconds. With RPA, money can be saved by eliminating late fees and duplicate payments, and often companies can start taking advantage of early payment discounts – all of which more than pay for the cost of implementing RPA.
P2P business processes are riddled with low-value, repeatable and consistent tasks that can be eliminated with RPA. Rather than hiring additional staff to improve an over-burdened accounts payable team, the focus should be on giving existing staff the automation tools to make their roles more strategic and focused on value-add duties. Often the easiest way to do this is by working with a technology partner
Blueprint is the ideal partner for helping businesses plan out and execute their robotic process automation around finance, supply chain logistics and menial tasks.
When engaging with any partner to implement an RPA-led P2P process, the first step should be to thoroughly understand a company’s business objectives and current processes. From there, efforts can focus on strategic areas of improvement to return value quickly.
Let’s start a conversation about how Blueprint can develop and implement forward-thinking RPA solutions that will give you a competitive advantage in the marketplace.