The traditional Procure-to-pay (P2P) cycle has been an uphill battle with manual approvals, siloed systems, compliance gaps and delayed payments, leaving both buyers and suppliers frustrated. But this narrative is changing dramatically now.
Automation is now the hero in the story of P2P process, transforming it from a transactional process to a strategic powerhouse that fosters efficiency, transparency and control.
By automating procure-to-pay process, organizations are now streamlining every step of the procurement cycle from purchase requisition and vendor onboarding to invoice matching and payment processing. This intelligent automation enables real-time approvals, extracts data from unstructured invoices and ensures compliance. It leverages machine learning models to detect anomalies, flag risks and auto-correct errors before they escalate.
The future of P2P isn’t just about digitizing existing processes, it’s evolving from a paperwork driven process to a performance driven powerhouse. This transformation creates an autonomous and intelligent ecosystem where all the verticals – procurement, finance and suppliers are collaborating seamlessly.
Breaking free from Inefficiency: Power of P2P Automation
Let’s say you are managing a retail store that is still using the traditional methods in the procure-to-pay(P2P) process- overloaded with manual data logging and time-consuming approvals. These manual tasks drain out resources time and slow down decision making. As procurement is a complex process that involves managing cash flow, navigating multiple approvals, and communicating with suppliers, it stands as a bottleneck that hinders overall operational efficiency in your business.
In consequence, automating procure-to-pay process can deliver powerful solutions that avoid costly mistakes from purchase requisition to payment processing for any business that are striving for maximum efficiency.
Let’s explore how P2P automation is transforming and redefining the future of procurement.
Why should you let your old traditional P2P process go?
Traditional methods have become antiques. As the procurement process requires careful attention to detail to ensure smooth operations, traditional methods come with inefficiencies that cost us time, money, and resources in traditional methods. Some of the most pressing challenges are,
Approval delay and bottlenecks
Each step in the p2p process has multiple approvals. As you are still using email process and paper-based approvals, the delay in this process disrupts the entire procurement cycle. For instance, a delay in approval of critical raw materials may make your company miss the production schedules you designed for a bulk order.
Fragmented data across systems
When you often work on multiple systems which are disconnected like spreadsheets, ERP, manual logging of data. The fragmentation and absence of cross communication can cause poor visibility into spending patterns and supplier performance. And with inefficient data insights, we struggle to make an informed decision.
Compliance complexities
Manual data logging is prone to errors. And ensuring compliance with internal and external regulations stands challenging for procurement teams. Sometimes it leads to penalties and reputation damage.
Invoice matching errors
Maintaining our reputation with the supplier is vital in a business and when there is a mismatch in invoices, it causes loss of trust. Following traditional methods often leads to mismatches, payment delays, or sometimes duplicate payments. Either way, it’s a costly mistake that the company has to pay.
Supplier relationship management
As mentioned above, supplier relationships are important for seamless workflows, especially during a sticky situation. And it is challenging with delayed payments, lack of communication transparency. This impacts collaboration and ends up missing opportunities, discounts during crisis.
How automating procure-to-pay process solves these challenges?
The good news is that automation doesn’t just simplify the P2P process; it transforms it entirely by addressing these real-time challenges head-on.
Document Extraction and Invoice processing
Procure-to-pay automation utilizes IDP – intelligent document processing to extract data from unstructured invoices and other documents. It eliminates manual data entry and fastens approval procedures. This technology can capture data like invoice numbers, dates, and amounts automatically and integrate into the procurement system seamlessly.
Streamlined approvals
Automated workflows eliminate bottlenecks by routing requisitions through predefined approval hierarchies in real time.
Solution Impact: Faster procurement cycles ensure operations remain uninterrupted.
Centralized data visibility
Integrating disparate systems into one centralized dashboard, providing real-time insights into spending patterns and supplier performance creates a unified place to access entire information.
Solution Impact: Teams make better decisions based on accurate data.
Built-in compliance
Automated data management enforces compliance by standardizing processes and maintaining audit trails for every transaction.
Solution Impact: Reduced risk of penalties and improved regulatory adherence.
Error-free invoice matching
AI-powered three-way matching process which includes crosschecking of purchase orders, receipts and invoices, ensures data from all the 3 sources align perfectly, eliminating errors. This intelligent automation identifies any mismatches before it gets escalated.
Solution Impact: Faster payments improve supplier trust while reducing disputes.
Enhanced supplier management
Procurement Automation simplifies supplier onboarding processes and aids in tracking their performance, metrics and ensure timely approvals and payments.
Solution Impact: Stronger relationships lead to better collaboration and negotiated discounts.
How can Proceso help you through this transition?
Proceso is a no code workflow automation platform that is designed primarily to resolve real-world challenges in business processes. And for a complex process like procure-to-pay, it includes multiple stake holders for each step.
Proceso’s Unified Approvals streamlines the approval process in procurement automation. It acts as a unified frontend for all the existing LoB applications in the organization like SAP, Salesforce, SAP SuccessFactors, service now, Dynamics 365, QuickBooks, Workday, etc.
Unified dashboard: The extension of your existing LoB applications with proceso allows you to streamline all the pending approvals for each one in the process flow.
Automated notifications on pending requests: User can get notified of all approvals that are pending from your end on a single page.
Dynamic procurement Automation: Automating procure-to-pay process and configuring tailored workflows according to your organization’s needs without coding.
Secured communication: As proceso runs on Microsoft teams, the communication happened on proceso is safeguarded with robust security frameworks.
Success stories:
We simplified the approval management system for a leading oil and gas company. The company uses SAP, SuccessFactors and other Line of Business applications for finance, procurement, employee self-service and more. So, the managers are spending hours of their time juggling between those applications the entire day to clear their pending approvals.
Proceso unified approvals simplified their day-to-day job and enhanced productivity. With the reduced costs, more than 150 managers are using proceso in that organization for multiple use cases.
Benefits of Automating P2P with Proceso
By implementing Proceso for automating procure-to-pay process, you can expect:
1. Faster procurement cycles that eliminate delays.
2. Reduced operational costs through error-free workflows.
3. Improved supplier relationships, thanks to timely payments.
4. SOP completed on time without errors and need for escalations
5. Vendor audits made simpler with all the data recorded on a secure device
Conclusion
Automation is transforming the story of procurement to a must faster and efficient process. By addressing approval delays, fragmented data, compliance risks, invoice errors, and supplier management struggles head-on, we can transform our procurement operations into a strategic asset.
The future of procurement isn’t just about digitization, it’s about building an autonomous and collaborative ecosystem where procurement, financers and suppliers are on the same page ensuring a seamless workflow.
Frequently Asked Questions (FAQs)
- How does automation improve P2P efficiency?
Automation eliminates manual tasks like approvals, invoice matching, and compliance tracking, speeding up processes while reducing errors.
- What industries benefit most from P2P automation?
Industries like manufacturing, retail, healthcare, construction, and technology benefit significantly with P2P automation as they have complex procurement processes.
- What are the 5 risks in P2P process?
Human errors, poor process flow, non-compliance, fraud and irregular spending or excessive costs are the five risks in the P2P process.
- Is Proceso suitable for small businesses?
Absolutely! Proceso’s no-code platform makes automation accessible for businesses of all sizes without requiring extensive IT resources.
Are you ready to transform your P2P operations with workflow automation? If yes, schedule a demo with our experts who customizes the workflow automation according to your business needs.