Reducing Contract Cycle Time Using Source-To-Pay Solutions
CONTRACT CYCLE TIME
When executives in the finance departments of large companies are considering software solutions to reduce contract cycle time, one option, as part of their source-to-pay suite, is Source-to-Pay solution. This type of solution streamlines the contracting process with automation, streamlined workflows and real-time analytics, ultimately resulting in accelerated time-to-value and spend management performance.
There are many benefits that Source-to-Pay solution provides, besides the obvious goal of reducing contract cycle time. Streamlined workflow and automation reduce the amount of manual effort required to process contract and provide visibility into the status of each contract throughout the cycle. Automated purchase order tracking and automated renewal notifications, as well as digital straight-through processing, reduce time-to-value and provide digital representation of the entire process.
Additionally, real-time analytics offer businesses valuable insights into their contracts and the entire process. Through advanced analytics, businesses can identify common points of failure and quantify the effects of these issues in order to prioritize solutions. This data can often provide key insights into the source materials, such as what the typical transactional sequence looks like, the total volume of contracts and parties, and where the bottlenecks exist.
For businesses to be able to make the most out of their Source-to-Pay solution, there are certain best practices that must be followed. The most important step is to understand the process and workflow of your business before implementing Source-to-Pay solution. This step involves mapping out all the parties involved in the contracting process, and the sequence of actions they take to move the contract through the cycle.
Having clear understanding of the process allows businesses to assign roles and responsibilities, as well as set expectations among those involved. Furthermore, businesses must have clear purpose for implementing the Source-to-Pay solution. An effective purpose might be reducing the cycle time, but businesses may also consider evaluating cost savings or improved accuracy.
The next step is to choose an appropriate Solution Provider. businesses must consider the cost, ease-of-use, implementation, and performance of the provider in order to select the best solution. It is imperative to choose provider with good technical background, as the solution needs to fit the exact requirements of the business.
The third step is to ensure the setup of the Source-to-Pay solution is in line with the goals and requirements of the business. This requires specific configuration and customisation, in order to ensure the workflow and processes are optimised for the purpose of reducing contract cycle time.
Once the Source-to-Pay solution is set up, businesses must move onto implementation. This is crucial step, because it is the point at which the changes occur and the solution is put into place. The implementation process involves intensive training of staff, creating timeline for the transition, setting performance metrics to track the improvement, and continuous adjustments based on the performance metrics.
Finally, businesses must ensure that the Source-to-Pay solution is managed effectively and is producing tangible results. This requires ongoing monitoring of performance metrics and providing feedback to the Solution Provider if there are any issues.
Using Source-to-Pay solution is an effective way for businesses to reduce contract cycle time and improve the overall efficiency of their contracting process. For best results, businesses must take the time to understand their requirements and evaluate providers, before configuring and implementing the Source-to-Pay solution and continually monitoring its performance. By doing so, businesses can improve their contract cycle time and get the best value out of their Source-to-Pay solution.
