According to a Deloitte global report from August 2020, 2 in 3 companies (66%) were expecting to pursue cost reduction over the following months, compared to 38% before the Covid-19 pandemic. In this instance, purchase to pay (P2P) processes are often targeted for improvements due to the substantial amount of money that flows through them. This article will discuss the pain points usually found in a purchase to pay process, how to address them using the right features, and the benefits of such optimization to your organization.
What is a purchase to pay process?
Purchase to pay is the business process that connects the acquisition of goods and services with their respective payment. Such integration is typically automated by software, allowing companies to save time and money.
A purchase to pay process is different from the broader range of activities of a Purchase department, which include sourcing items, managing their deliveries, and negotiating contracts with vendors. Purchase to pay workflows connect automated tasks from Purchase teams and Accounts Payable teams. Their usual steps are the following:
Improvements to purchase to pay processes include redefining existent automation, eliminating more manual tasks, and creating standards for communications. Usually, the benefits of such modifications include:
Main problems that may affect a purchase to pay process
The 2020-2021 PwC Digital Procurement Survey shows 48% of companies interviewed had automated purchase to pay workflows in 2020. Although it represents an increase in comparison to 2017 (36%), it’s still less than half of all the cases observed. The slow rate of digitalization might be behind some of the main problems that affect a purchase to pay process. Here are some of these issues:
5 Steps to promote purchase to pay process improvement
If you are experiencing at least one of the problems mentioned above, what should you do next? To achieve the so-needed purchase to pay improvement, we recommend you follow the steps below:
Why request forms are critical to purchase to pay optimization
Public standardized forms are critical to improve a purchase to pay process, as we mentioned. The lack of consistent communication triggers massive problems. They include inaccurate acquisitions, duplicated work to clarify requests, misunderstandings with external clients and suppliers, extra labor to inform stakeholders about the status of their process, hours and hours replying to emails providing clarification, and many other bottlenecks.
A uniform request, accessed by a shareable link, should help eliminate these issues. The ideal form is customizable to fit the company's visual identity. It also allows stakeholders to fill the blanks with helpful information and upload requested documents. Once the information is provided, the parties involved should be notified by email. Furthermore, they must be able to receive notifications when there's progress on their purchase or payment order.
Finally, it's important that these forms are integrated into an automated workflow. For instance: depending on the information provided on the public form, a task (represented by a card) can be automatically routed to a specific supervisor in case it requires approval or analysis. Ideally, these forms should also feed databases, allowing supervisors to closely watch the cash flows and other insightful numbers of the purchase to pay operations, such as SLAs.
Eliminate communication cracks from your purchase to pay process with Pipefy Forms
Benefits of adopting public forms to improve purchase to pay processes
After conducting a well-planned implementation of customizable public forms, you will probably observe a streamlined P2P process. Some outcomes of adopting such strategy to improve this workflow include:
Therefore, losses and delays caused by human mistakes will be avoided, allowing your company to:
Companies that deployed public forms, for instance, have already achieved impressive milestones. Samsonite, a worldwide leader in superior travel bags, started to manage all purchase requests with Pipefy, a no-code process management platform that offers public forms.
After that, it has seen a return over investment (ROI) of 177% – saving over 2,370 paid employee hours in just five months. According to its Customer Service and Procurement Manager in Brazil, it is now possible to "set a target to reduce spending by eight percent, for example, and monitor whether we're hitting that target throughout the year."
Using the same features to structure its financial department, a fintech company that offers payment solutions has achieved a ROI of 192%, saving approximately 2,500 hours per month. Other teams implemented the same solution, such as Compliance, Legal, and Customer Success.
Improve your purchase to pay process with Pipefy Forms
Pipefy Forms facilitate the improvements you have been seeking for your purchase-to-pay process. With this feature, you will be able to create online public forms that can be shared with anyone. Tailor your processes according to your needs by adding your company's logo, a preferred background, and all the information fields required.
Deploy a perfect public form with your stakeholders, accelerate purchase and payment flows, increase visibility for finance managers, and build an error-proof automated process. Kick off the changes you need today: try Pipefy Forms for free.
Purchase to pay is the business process that connects the acquisition of goods and services with their respective payment."