Procure-to-pay (P2P) systems automate the full purchase-to-payment or “req-to-check“ process, connecting procurement and invoicing operations through an intertwined business flow that automates the process from identification of a need, planning and budgeting, through to procurement and payment.
The critical function that P2P plays in an organization’s business is growing in importance with the complexity of the global supply chain. The most important thing for any business to understand here is that optimization is the most important part of creating something that will retain its value throughout the entire progression. In order to accomplish this, the company must first understand the drivers that are responsible for the optimization.
Optimization Drivers for P2P
There are four basic drivers within P2P optimization:
- Cash management
The four drivers that are a part of the P2P process usually do (and should) have associated metrics that allow organizations to monitor the activities of that process in order to both measure the overall performance and make improvements where it is necessary.
Another essential driver in the optimization process is visibility and its movement into real-time and accurate data flow through all stages of P2P. There are four very important tools necessary for the creation of visibility:
- Accessibility to data
- Tools for reporting and analytical methodology
While some companies may actually place more importance on one of the above drivers, which will determine the metrics necessary for monitoring, tracking, and improving performance, it is also important to understand the importance of defining your purpose and establishing a target that is within reach when creating the metrics for your P2P method. You want to avoid the overuse of metrics, so be careful to choose those that are the most important to the objectives of your organization. You can develop them in phases in order to achieve the end result of making improvements in the company’s connectivity to suppliers and customers.
One of the most important—but often underinvested—aspect of using P2P is the company’s ability to integrate it into all current workflows and IT systems and payment processes. This includes ERP systems, B2B commerce portals, Order-to-Cash flows, EDI systems, banking, and many more. While tremendous gains have been made to bring these various systems closer together over the years, the payments and payment providers have simply not kept pace. In fact, when it comes to payments, the term P2P is somewhat misleading. Payment has been a completely separate and disconnected process from the rest of the flow.
Traxpay is changing this, and transforming the way that companies pay and get paid. By bringing faster, safer, smarter B2B payments together with rich data, and the ability to integrate into existing P2P workflows, Traxpay is able to close the last mile of the transaction—the payment—while providing total transparency across the flow and across the supply chain.