Risk Of Going Without Source-To-Pay Software
BUSINESS SPEND MANAGEMENT
CFOs and other financial leaders need to be aware of the risks of going without source-to-pay software. Without such system in place, there stands to be significant decrease in corporate visibility into the spend and procurement operations. In this day and age, where supply chains can stretch across the world and often involve numerous stakeholders, it is vital to maintain robust insights into the entire workflow. Such lack of visibility can cause myriad of issues, including fraud and inefficiencies.
One of the problems with not having source-to-pay software is that it is difficult to enforce desired compliance practices. Companies are more closely scrutinized than ever before, and they must ensure they adhere to both internal and external rules. These compliance obligations vary greatly depending on the industry and can be extensive. Without proper software solution, it is extremely difficult, if not impossible, to determine if the company is compliant with all necessary regulations.
In addition to the tracking and compliance capabilities that source-to-pay software provides, it also helps streamline the process of managing approvals. These systems offer comprehensive automated approvals that network across the software and provide notifications to interested parties in order to keep everything on track. This is far superior to manually managing approvals and attempting to track changes in something like an Excel spreadsheet. Moreover, these approvals will automatically stop should there be any violations to the desired parameters, allowing for certain degree of personal oversight that manual systems lack.
It also happens to be the case that there are tasks that can be completed more quickly with the help of source-to-pay software. For example, the process of creating purchase orders is radically reduced, especially when compared to archaic paper-based approaches. This can be used to ensure logistical dock is streamlined and orders are accurate. Additionally, pushback on prices can be expedited within the software, which is something that would require significant amount of time within manual system.
In sum, there exist numerous risks when it comes to neglecting source-to-pay software, such as decreased visibility, compliance issues, and inefficient management of approvals and purchase orders. Hence, financial executives should strongly consider assessing their current practices and determining if some form of software could be put in place to mitigate these risks and optimize their operations.
