What if you could knock one full day off of your purchase order cycle time? An e-procurement solution can do that…and more. .
An AQPC Procurement Benchmark report from 2015 found that automating the procurement process can lead to greater efficiencies throughout the entire transaction process The reality is that.faster cycle times in the procure-to-pay process and more efficient order processing are clearly demonstrated where investments have been made in e-procurement or e-sourcing. In fact, the cycle time to place a purchase order shifts from 16 hours to 8 hours with automation. Meanwhile, the same benchmarking data, as reported by SupplyChain247 in the article “Benefits of Modernizing the Procure to Pay Process,” shows that the number of POs processed by a procurement FTE increased from 615.7 to 1,302, using an automation solution.
A big part of the move toward efficiency in implementing e-procurement is the allocation of Procure to Pay FTEs. When fewer FTEs are needed for the tactical tasks of ordering, these same resources can be moved to more strategic functions within the organization. Overall, the time and efficiency benefits of investing in e-procurement or e-sourcing are dramatic. Even among those organizations that have not yet adopted the technologies, there is recognition of the need to modernize the P2P process. APQC found that, of responding organizations, 82% use e-procurement and 6% plan to adopt it within two years. But there is a caveat for those considering this technology. Follow-through on the shift to e-procurement is of utmost importance; that is, an end-to-end solution can be crucial.
One of the more revealing results from another APQC benchmarking report (this one dealing with accounts payable) showed that streamlining the front end of the P2P process provides only partial benefits. There really is a need to automate and streamline the entire process.
What is at least as important as cost and time is the knowledge and business intelligence companies can garner by having real-time visibility into the entire transaction cycle. Plus, many of the e-procurement solutions offer reports and analytics that will enable companies to make better, more strategic decisions.
See how automating your P2P processes can make a significant difference in your bottom line.