Having a competitive edge is crucial right now. Many businesses are looking at procurement to gain efficiencies. If a Business has inefficient Procurement and Accounts Payable processes, software systems like ‘ Procure to Pay ’ (P2P) and ‘Source to Settle’ (S2S) can bring about notable gains. They can boost efficiency, provide cost savings and tighten compliance across the whole business.
In our previous blog, we discussed the top five benefits of a ‘No PO No Pay’ policy to refine the procurement process. In this blog we’re looking at the wider procurement process ‘Source to Settle’. This is a broader procurement model, which refines and integrates the whole procurement journey – from sourcing suppliers, standardising contracts and collaborating more online with suppliers.
‘Source to Settle’ (S2S) is an advanced procurement model which streamlines purchasing processes. It integrates supplier sourcing, procurement, and accounts payable. The model is more suited to companies with a more complex purchasing process. P2P may be more suited to businesses with simpler requirements.
P2P evolves around the requisition of goods and services and ends with payment being issued by accounts payable. S2S takes a much more holistic and strategic approach to the entire sourcing lifecycle. There are many more layers adding value to the process.
S2S helps businesses plan effectively, source suppliers better, and purchase products and services more efficiently. Compliance is improved and business risk reduced, whilst helping you manage your supplier relationships. The cost savings with a S2S model can span across an organisation rather than just the procurement department.
The different parts of a S2S process include (but are not limited to):
What could implementing a Source to Settle process do for your business?
Using S2S processes can not only bring numerous significant benefits to your business but your suppliers benefit too.
If we look in a bit more detail at the S2S process, the benefits start to become clear.
S2S means you can manage the supply chain more effectively whilst building better relationships with suppliers. This reduces risk, makes significant cost savings, and enforces compliant spending. It will also improve compliance through auditable processes. All this should be good news for profitability and value creation.
Critically it will enhance your master data. Providing up-to-date and accurate data will ensure your automated invoice processing can process your supplier invoices with fewer touches. Poor data in your ERP accounts for many of the exceptions seen in a No PO No Pay process.
Adding S2S to your existing P2P processes might just help you find that competitive edge.