Q: We have allocated budget dollars to automate the Procure to Pay (P2P) process, but then when it came down to implementing a solution, we realized that we would only be automating one piece of the spend. What did we do wrong?

A: Numerous companies believe that when they implement a P2P solution, they will get a full end to end procurement to payment solution that is as good on the procurement side as it is on the Accounts Payable side. Unfortunately, they've ended up being pigeonholed with a solution that focuses predominately on the first P in P2P, which is the procurement aspect, and leaves the Accounts Payable aspect lagging behind. Most P2P solutions in addressing Accounts Payable's needs focus exclusively on the invoices that relate to the PO's generated from the P2P solution but fail to address the non PO invoices, which almost all companies have.

By ignoring non PO invoices, this leaves the AP department struggling to find another solution to handle the non PO invoices, in effect leaving them with only a partial solution for their invoice processing needs. The purchasing group is typically satisfied in a P2P scenario because they have a solution to address their procurement needs but the Accounts Payable department seems to always be the forgotten aspect because P2P frequently fails to address all of the invoices received. We see many companies with a mix of 50/50 PO based invoices to non PO based invoices so these companies are in effect only getting half a solution in a P2P driven solution. Accounts Payable needs to be actively involved in the P2P decision process to make sure their needs for all invoices are addressed. However the reality is P2P is frequently driven by the procurement group who may not have the best interest of the Accounts Payable department in mind when choosing a solution that has a direct impact on Accounts Payable processing.

Click here to email us your AP question.