Utilizing Managed Procure-To-Pay Services To Streamline The Payment Process
PROCURE-TO-PAY SERVICE
Managing the procure-to-pay process can be complex and time-consuming. However, with the right managed service, C-suite executives in the finance department can attain newfound efficiency. The far-reaching implications of utilizing managed service can range from realized cost savings to improved relationships with vendors. Here is step-by-step guide to navigating the procure-to-pay process with the help of such managed service.
Step 1: Implement Managed Service
The first step in capitalizing on the potential of managed services is to gain access to the service itself. Doing so requires research into the capabilities of the different services offered, as well as careful consideration of the individual enterprise?s procure-to-pay needs. This process of assessing which managed service is the ideal fit can involve evaluating aspects of scalability and user experience, as well as considering the particular budget for the operation.
Step 2: Establish Budget
Once managed service has been selected, the next step involves setting budget for the procure-to-pay process. This will entail taking into account the varying fees associated with the managed service, as well as the estimated costs of vendors and associated purchases. Careful management of these two sets of expenses is essential, as it isets determined baseline that all further decisions pertaining to procure-to-pay should respect.
Step 3: Establish Vendor Relationships
The third step in deploying the managed procure-to-pay service is to create and manage relationships with vendors. In order to accomplish this, executives should analyze and evaluate potential vendors, carefully considering factors like delivery schedules and potential financing discounts. Furthermore, establishing contractual conditions for outcomes that are unable to be met or exceeded by the vendors is recommended. This allows for level of accountability on the vendor?s part that sets clear expectations for the relationship.
Step 4: Payment and Verification
The fourth step involves paying vendors and verifying that their services have been completed and the process has been carried out efficiently. More specifically, it is necessary to cross-reference the terms of the vendor?s contract with the final outcome of their service. Doing so serves as benchmark for the effectiveness of the procure-to-pay function and allows executives to identify opportunities for improvement at any point during the process.
Step 5: Report and Evaluate
The final step is to put together and evaluate management report based on an analysis of how the procure-to-pay managed service process has been operationalized. The report should be comprehensive, addressing factors like cost savings and vendor efficiency while taking into consideration the fact that external circumstances can change at any point and require the managed service to adjust in order to remain effective.
By following these five steps, C-suite executives in finance departments can capitalize on the potential of managed services to streamline the procure-to-pay process. With the right service selection, financial planning, vendor scanning, payment verification and reporting, executives can unlock newfound efficiency, helping to realize potential cost savings, as well as developing strong relationships with vendors.
