A Comprehensive Guide To Utilizing Source-To-Pay Solutions For P2P Analysis
P2P Analysis Tool
In the rush for companies to maximize the efficiency of their business processes, the digitization of data is paramount. One way to accomplish this goal is to deploy Source-to-Pay (S2P) solution, which focuses on the procurement process. S2P solution combines the procurement process and analytics across the various steps in systemic, holistic fashion. This article is geared towards executives that work in finance and/or procurement department, who are exploring various S2P solution and their utilization for P2P analysis.
P2P, or Purchase to Pay, is essentially network within company of financial personnel and anyone else involved in the procurement process. This encompasses the purchase and provisioning of goods, maintenance and monitoring of vendor contracts, and ensuring accounts payable activities are monitored. P2P analysis is the mechanism which checks all of the components of an organizations purchasing operations and viable vendors or suppliers.
The purpose of S2P solution is to automate, combine and streamline activities related to procurement. This includes delivering an all-encompassing solution for procurement activities that include the following components: Requisitioning, contract management, procurement, vendor management, invoicing, and payment.
To efficiently utilize S2P solutions for P2P analysis, the following steps must be taken:
1.Set Up Your S2P Solution: It is imperative to configure your S2P solution according to your organizational policies and goals. This includes proper configuration of your chart of accounts and supplier preferences. Additionally, establish an appropriate authorization mechanism based on roles and responsibilities within the organization, and assign user access and permissions.
2. Manage Supplier And Contracts: The S2P solution should be utilized to manage processes related to supplier contracts and the underlying master data associated with suppliers. This should include detailed accounting of anticipated business transactions, analytics of pricing and payment terms, information related to their delivery dates, contact details, and any other pertinent information.
3. Control Purchasing Processes: Utilize the S2P combined with P2P analysis capability to control your purchase processes. This includes leveraging the S2P platform for requisitioning for goods or services, as well as creating and monitoring requisitions including requesting quotes, purchase orders and contracts.
4.Vendor Performance Management: The S2P solution should be used as the platform to evaluate and measure vendor performance. This should also include the utilization of automated analytics to identify missed payments and discrepancies related to supporting documents, as well as an effective dispute resolution system.
5.Manage Invoices Payments: Utilize the S2P platform to track and manage the multiple types of invoices received from suppliers. Jobs related to the verification of invoices, the comparison to their respective purchase orders or contracts, and to create payment orders should be streamlined within the S2P solution.
6.Reporting Analytics: Leverage the analytics capabilities of the S2P solution to gain visibility into the overall performance of the purchasing process. This should include insights and analysis of requisitions, transactions, invoices, payments, purchase orders, and contracts. it ishould also include monitoring of any budget changes, as well as fiscal and non-fiscal analytics.
Organizations that implement S2P solution in tandem with internal P2P analysis are able to monitor, analyze, and optimize spend across all facets of purchase requests, purchase-to-pay activities, and payment invoicing. Utilizing comprehensive solution drives down costs and drastically increases corporate visibility into the entire procurement process. Furthermore, with the ability to analyze 100% of payment data and analyze it with big data analytics technology, organizations can gain unprecedented insights across multiple departments.
Overall, S2P solution in conjunction with P2P analysis is valuable tool for organizations who want to combine the visibility and insights of profitability, financial close, and corporate performance metrics into single system of record. By leveraging the power of analytics, Procure-to-Pay teams can improve overall efficiency, cost savings and credibility throughout the organization.
