Monthly Archives: April 2014

P2P in 2020: Millenials & Adapting to a Changing Workforce

This blog is part of a series detailing the projected outlook for purchase-to-pay (P2P) in 2020. Increased adoption of automated processes, a changing workforce, and increased government regulations all present challenges in the near future for many AP departments. Preparing for these challenges and meeting them head-on is essential to ensuring sustainability and profitability for any organization.

In our last submission to this series we identified perfect processing in the next 5 years: seamless collaboration between buyers and suppliers that ensures timely payments that capture the highest discounts and rewards. Next, we need to look at what the subsequent generation’s AP department will look like.

Today the average age of AP staffers is 48, while twenty years ago it was close to half that. The reason—it’s simple—today’s college graduates, generation Y or “Millennials,” shun manual data entry jobs. Millennials are very different from their baby boomer or Gen-X parents. In fact, in many ways, they’re polar opposites. Millennials have a need for constant feedback and this is often seen as a bid for attention or a lack of know-how. In actuality, this is often just a result of being eager to please and having access to instant confirmation via the Internet and social networks most (if not all) of their life. Whereas the baby boomer generation fully accepted a hierarchical structure and a “work-your-way-up” philosophy, Millennials crave immediate gratification. They are data-driven, not concerned with emotion, and are used to dealing in hard facts. They desire equality and an equal say more than a formal pecking order. Millennials are action-oriented, self-motivated, and eager to achieve goals. Positions that don’t offer advancement and creativity will leave Millenials feeling restless and they will quickly move on. So the question remains, how can P2P departments reorganize to attract the new generation?

It starts with being open, honest, and realizing that change is inevitable. An automated P2P process is a necessity in today’s market. P2P managers need to communicate an automated vision with their staff and truly listen to their feedback. Holding face-to-face meetings individually with staff members is an essential component with Millenials because it gives them the opportunity to articulate their goals and find a common direction that will lead to productivity and innovation. Employees need to be energized to drive successful transformation to automation.

Implementing an automated P2P process will facilitate a realignment of staff and roles. Managers can take full advantage of this opportunity to redeploy their staff in the most effective way possible. Roles should be aligned with business units and existing employees should be able to self-select their new roles. Processing, analytical, and customer support staff should also be involved in the interview process since they will be working side by side with new hires as well as expected to collaborate with them on team projects.

For many, the biggest hindrance to a successful eInvoicing implementation is supplier adoption. Persuading suppliers to change their processes to align with buyers’ needs can be a costly and time-consuming process and success depends largely on the buyers’ ability to present a compelling value proposition to suppliers.

One of the best things that can be done for this is to keep them involved from the moment it is decided to make the transition. In doing so, an organization will likely gain higher adoption rates than if they autocratically demanded it after the fact. Another proven method to increase supplier acceptance of eInvoicing is to give suppliers the ability to conduct purchase order (PO) flips. The more accurate and timely an invoice, the quicker a supplier will get paid, and thus the more likely they are to adopt an eInvoicing payment method.

The steps taken today to automate invoicing and adopt P2P best practices will ultimately determine an organization’s future adaptability and success in attracting talented workers.

Basware Issues Green Guidelines for Earth Day

Basware, a leading provider of eInvoicing purchase-to-pay (P2P) solutions, recently released guidelines to help companies minimize their carbon footprint through financial process automation. These guidelines were developed for the growing number of companies that are concerned about corporate compliance with green initiatives, and at the same time are looking to streamline processes and gain business benefits.

“Many companies are drowning in paper, and nowhere is this more evident than in the Accounts Payable department,” said Bob Cohen, Basware VP, North America. “The hundreds of billions of invoices that are sent annually worldwide create business as well as environmental problems, increasing costs, inefficiencies, errors, and more. By switching to e-invoicing and automating financial processes, companies gain greater visibility and control over spend and working capital, and improve their supplier relationships. It’s not only a matter of businesses ‘doing good,’ it’s also good business.”

Basware recommends four key steps to establish green purchase-to-pay practices including:

Send invoices electronically through cloud-based business commerce networks. Of the approximately 350 billion bills and invoices sent globally each year, about 330 billion (or more than 94%) are sent as paper invoices, according to industry consulting firm Billentis^[i]. If all of these invoices would be sent electronically, 138.6 million trees and 143 billion liters of water could be saved, which would reduce the carbon footprint of one invoice by 63 percent^[ii]. In addition, it enables up to 80 percent cost savings as companies eliminate time-consuming and manual processes, such as printing, mailing, scanning, keying in invoice data, and manual matching of invoices to orders and archiving. With supplier on-boarding, supplier portals and other services, companies can be well on their way to receiving 100% of their invoices as e-invoices and encourage environmentally friendly practices among their trading partners.

Promote green initiatives in procurement by ordering through e-catalogs on business commerce networks to eliminate large paper catalogs. Additionally, identify and purchase from suppliers that support environmentally friendly initiatives.

Look for ways to make payments electronic. Innovative e-payment solutions are becoming available that will speed up slow invoice processing and invoice payment tasks, ensure that suppliers get paid quickly, and extend terms for buyers.

Strive for continual improvement. Use analytics to measure key metrics in your green initiatives. This will provide insights into ways you can elevate processes to work smarter, achieve greater green benefits and take performance to new levels.

To read the official press release, click here.

Coupa’s New Features Inspire – Part 2

PayStream Advisors continues our attendance today at the two-day conference hosted by Coupa, a leading provider of cloud-based financial applications, in San Francisco, CA. Raja Hammoud, Coupa’s VP of Product Management, led this morning’s keynote session. She spoke of Coupa’s successes and added functionalities over the past year as well as what’s in store in the coming months. Following Raja’s introductory keynote, Erik Wahl, an author, artist, and entrepreneur gave an incredibly inspiring speech about reawakening your inner creativity and how procurement and finance professionals can use that creativity to break boundaries and revolutionize their industry.

Raja began her session by telling a story of how one of Coupa’s customers, the Columbian Government, heard of a small village of less than 10,000 people using Coupa’s procurement function to source insurance for their village. They accomplished their goal without any training from Coupa or their government. This stands as a testament of how truly innovative and easy to use Coupa really is. Raja attributed this success to how Coupa’s product strategy rests on three principles: holistic spend capture, delivering user-friendly experiences, and offering comprehensive and organic solutions.

Holistic spend capture is a foundation because you can’t manage what you can’t capture. Delivering user-friendly experiences is how Coupa drives adoption within organizations. By offering consumer-like dashboards and recognizable paradigms within their platform, employees are more likely to use Coupa. Raja said that the moment a software becomes more frustrating or confusing than a traditional paper-based method, that’s the moment adoption ceases. Coupa’s third principle of delivering a comprehensive organic suite is simple. They sought to build a solution from the ground up, not putting together pieces of other applications and rebranding. In doing so, they created an end-to-end solution for the entire spend process covering procurement, expenses, and invoices.

Over the past year Coupa has flushed out their newest functionality, Coupa Procurement. Administrators are able to tag items they want to go to the top of search results when users are sourcing. In this manner, they may suggest items that they’ve found are particularly valuable or cost-effective while still offering choices to the end-user. What’s more, the end-users are able to compare preferred items with others to see if they are satisfactory for their needs. Another feature new to the procurement platform is improved approval workflow by skipping unnecessary approvers when designated by administrators. This was obviously something that Coupa user’s had been asking for—at its announcement, the audience went into a raucous applause.

Raja also announced several product features that are new to Coupa and will be arriving within the next few months. Search optimization dashboards will soon arrive that allow administrators to view search information within their own organization in real time. The benefits to this are plentiful. Increased insight into what top items are being sought after, what items users were unable to find, as well as what searches lead to preferred purchases are just a few.

Another groundbreaking enhancement comes to the Coupa invoicing platform. Coupa found that AP departments often struggle with invoices that do not have a matching contract or PO; they are then left wondering who should approve such invoices. Now invoices submitted will have an “invoice requester” field allowing suppliers to route the invoice to the appropriate email address.

Perhaps the most highly anticipated and biggest announcement this morning was Coupa’s newest product, Coupa Inventory. Raja explained that through focus groups and customer interaction, her team was finding that it is often critical for organizations that have a large inventory to be able to better manage that inventory and have visibility when purchasing. They found that, particularly in the healthcare and food and beverage industries, organizations were often buying items they already had. Therefore, they sought to create a solution that would eliminate redundant spend. Coupa Inventory also invites an enriched shopping experience by allowing users to see what items are on hand and what items are running low. By carefully monitoring overstocked, understocked, or regularly ordered products, organizations can improve spend optimization and increase revenues. Raja said to expect the rollout of Coupa Inventory in late Q2 2014.

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Following Raja’s keynote was a powerful and motivating presentation by artist and author, ErikWahl. He told a story of failure and success and of his personal journey in reawakening his inner creativity. Erik polled the audience “Who here can draw?” As you might expect, no one raised their hand. He said that when asking the same question to a group of teenagers, 8-10 percent of the audience would raise their hand. He went on to say that when asking early grade school children, nearly every child raises their hand. Like most, as a child, Erik was taught that being an artist, being creative, or being innovative is something we cannot or should not do. Throughout his adulthood, Erik said that he went from being successful in business to having everything taken away from him in the blink of an eye. It was at that time that Erik began to paint and took the risk of investing everything he had left in himself as a painter. He is now a highly successful artist, author, and motivational speaker because of that risk. See a sample of his paintings below.

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Erik reminded us that to be truly innovative involves ignoring the fear to take risks. He saidthat fear is an acronym meaning False Evidence Appearing Real; that too often we let society tell us that we should follow the status quo and not upset the herd. He likened this mantra to the late Steve Jobs (as well as painted him in less than three minutes, see above). Jobs was repeatedly told that his method of thinking and innovation would never work. I think we all know where those naysayers are today. Like Apple, Coupa continues to reinvent spend optimization with creativity and innovation. To say the least, Erik’s presentation was truly inspiring…wink wink. #coupainspire

Coupa’s Strategic Partnerships Inspire – Part 1

PayStream Advisors is attending a two-day conference hosted by Coupa, a leading provider of cloud-based financial applications, in San Francisco, CA today and tomorrow. This morning’s keynote session was led by Rob Bernshteyn, Coupa’s CEO, and was a powerful story of how Coupa sought to empower procurement and finance professionals to be leaders in their organizations.

Mr. Bernshteyn explained that businesses are often too focused on revenue and ignore spend as a source of process improvement. Coupa took advantage of that and built their platform to garner real strategic movement in spend optimization. He also remarked that vision and strategy alone are nothing, quoting Henry Ford saying, “Vision without execution is just Hallucination.” He went on to describe the painstaking dedication and effort that went into the execution of Coupa and the company they are today.

The struggles and challenges Coupa faced are common themes among many organizations. True process improvement means more than trying to fix or emulate a potentially broken or convoluted bureaucratic process that may already exist in the company because that is the way it has always been done—it means taking the opportunity to rethink a process; to employ a technology that will actually optimize the way things work within an organization. Mr. Bernshteyn said that stellar AP Managers, Procurement Professionals, and CFOs work as enablers to a company. Often these departments are seen as bureaucratic offices that slow others down—through process improvement these departments can support sales, marketing, customer support and others. Mr. Bernshteyn said that the key to being an enabler is to keep things simple just as Coupa has done with their solution.

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Mr. Bernshteyn’s motivational speech included the announcement of several strategic partnerships that will further Coupa’s reach, improve their product, and increase customer satisfaction. Teaming up with Alibaba.com, a leading platform for cross-border wholesale trade serving millions of buyers and suppliers around the globe, Coupa now offers its users access to over 2 million suppliers worldwide. With an increase in the supplier network comes an increase in competition and thus a better supplier, product, and experience for Coupa users.

Coupa has also recently partnered with Box, a leading cloud-based content management and file sharing provider. With more and more data being stored on the cloud, Coupa wants to be an early implementer of the functionality before it becomes the status quo. Mr. Bernshteyn also announced Coupa has partnered with DocuSign. DocuSign is a provider of electronic signature technology and Digital Transaction Management services for facilitating electronic exchanges of contracts and signed documents. Incorporating DocuSign technology into the Coupa platform will expedite critical processes that require a genuine and verifiable signature.

Coupa already provides Coupa Analytics that allows users to view reports based on transactions within their platform. Partnering with Keboola, a custom data extraction and mashup company, Coupa is going to expand its analytical capabilities to include the ability to import data from external sources, such as payroll or direct spend data. Doing so will allow users to see what is happening in spend throughout their entire organization.

Mr. Bernshteyn’s final announcement today was that as of last week Coupa is now SAP certified. He ended his keynote address with what he feels differentiates Coupa from their competitors and what continues to lead to success—sticking to spend management. Coupa isn’t hampered by the diversification that may slow some of their competitors down; they aren’t burdened by also offering human capitol management or customer relation management. They’re focus is and will continue to be spend optimization management. Mr. Bernshteyn boasted of now having 423 customers representing 154 countries with support for 20 languages and 148 currencies. He also stated thatCoupa now processes over 500,000 transactions daily with 99.99% uptime that has led to a customer savings of almost 2 billion dollars for its customers.

The partnerships that were announced today will only further increase Coupa’s reach into the global marketplace. PayStream is very excited to see how these relationships flourish and the results they will bring. We hear that, while today brought the announcement of Coupa’s new partnerships, tomorrow will be one of new functionalities and we can’t wait to share with you our experiences. Stay tuned for part 2 tomorrow.

2014 TEM Report: Profound Growth in Use of Automation

PayStream Advisors has recently published our 2014 Travel and Expense Management (TEM) report and we’re excited to share with you what we’ve found. Manual data entry continues to rank as the number one challenge that organizations face in the expense management process. PayStream expects this challenge to fizzle away as the use of automated solutions continues to rise—Fifty-five percent of our survey respondents reported using a fully automated solution as their method of submitting expense reports (See figure below). We’ve also noticed over the last three years, the number of organizations using inter-office mail to submit reports and receipts has dropped from 37 to 30 percent.

One finding that should be of particular interest to organizations with a high level of employee mobility is the difference in average costs between survey respondents using fully automated, partially automated, and manual expense report submission methods. The difference between the averages of fully automated and manual reports was calculated to be $12.58. Considering close to 10 percent of respondents also reported to process more than 5,000 expense reports per month—this can be a six-figure difference in costs and therefore a huge opportunity for savings.

Modern TEM solutions continue to advance with groundbreaking mobile applications that make scanning images and populating and submitting reports easier than ever. These allow employees to focus on more important matters at hand such as pleasing a client, attaining a sale, or discussing partnerships. Several leading TEM solution providers helped fund this research and can be found in the latter half of the report. PayStream welcomes you to download a free copy of the report here.

Newest Supplier Finance Solution: Nipendo meets Integrate Financial

Nipendo, a leading provider of procure-to-pay automation solutions announced yesterday that they would be joining forces with Integrate Financial, a provider of supplier network financing solutions. The intended outcome of this partnership is to provide a supply chain finance solution that is tightly integrated with the procure-to-pay process, allowing buyers to offer early payments to their suppliers that can be expected as soon as hours after submitting an invoice.

As a result of globalization and increased offshore sourcing, for many US companies a lengthened supply chain has resulted in a reduction of capital availability. This often results in an extension of payment terms to suppliers and thus a higher cost of money and riskier supply base. The obvious solution to this problem is supply chain finance—a solution that has been around for decades. Yet recent studies have shown that only a small portion of organizations offer trade financing to their suppliers. Increasing capital and compliance requirements have left banks offering fewer financing options. Nipendo and Integrate Financial have teamed up to significantly reduce the risks and barriers typically associated with receivable financing.

Nipendo’s invoice automation platform ensures errorless invoice validation, reception, compliance, and matching to allow for suppliers to get immediate notification of non-compliant invoices. This results in processing and approval for payment almost instantly. Integrate Financial uses the data made available by Nipendo to offer near-real-time financing. Embedded into the Nipendo Supplier Cloud, Integrate Financial can make on-demand pre-approved financing offers to suppliers. Small and medium sized businesses that have seen increased restrictions from more traditional financing methods will find this highly valuable.

PayStream is very excited to see what this partnership will mean for the procure-to-pay automation industry. Be sure to look for Nipendo in our AP & Working Capital report scheduled to come out this June.

P2P in 2020: Automation in the Coming Revolution

P2P in 2020 will be about perfect processing. Perfect processing involves entirely automated untouched transactions with first-pass acceptance and payment. This results in seamless collaboration between suppliers and buyers to ensure timely payments that capture the highest discounts and rewards.

The level of perfection an AP department attains depends on efficiency and effectiveness. In essence, efficiency in AP is a measure of what your process is taking away from your organization—How many invoices are electronic? How much time are staff devoting to manual data entry? What’s the average cost per invoice and turnaround? These are also the areas that will drive effectiveness. Effectiveness is the measure of the value that your AP process is adding to your organization—What is the rate of invoice exception? What percent of available discounts are captured? Does the organization have enough visibility to monitor and control maverick spending?

Strengthened relationships with suppliers, transparency into spend, and increased revenues are all results of an effective AP process. As more businesses realize and adopt perfect processing, suppliers will come to expect quicker payments. Eventually, perfect processing (and the resulting fast payments) will become the status quo. Organizations that take steps to move toward efficient and effective P2P will see a larger long-term ROI than those that wait to implement perfect processing after it has already become the norm.

Business Process Outsourcing Leaders Join Forces

BancTec, a global leader in business process outsourcing has entered into a definitive agreement to be acquired by one of HandsOn³ (“HandsOn”) affiliated funds, The Dataforce Group. HandsOn is a global buyout manager based in Santa Monica, CA; this is consistent with their strategy of acquiring leading global BPO (Business Process Outsourcing) companies and transforming them into platform-enabled service providers that leverage globally positioned resources. In their press release announcing this agreement, HandsOn partner Jim Reynolds said, “This acquisition allows us to leverage our expertise and accomplishments by combining the strengths of Dataforce Group with BancTec to address the needs of our valued customers within our expanded marketplace.”

Dataforce Group is also a global provider of BPO services to enterprise level clients in the telecommunication, healthcare, charity, government, and auto and health insurance industries. Key services currently offered by Dataforce include AR Management, Document Receivables Management, and Customer Interaction Management. When combined with the key services offered by BancTec such AP Automation, Payment Processing, and others it is clear that these organizations will compliment each other well. Together they stand to offer a global BPO solution unlike any other on the market. PayStream Advisors is very excited to see what this acquisition will mean for both BancTec, Dataforce Group, and the BPO market.

The key leadership and management teams of BancTec will remain in place and play a vital role in the growth of the newly merged organization. Depending on the agreement of terms, closing conditions, and approval of stockholders, the transition should be complete by the end of April.

Acquisition of TradeCard Establishes GT Nexus’ as Global Leader

GT Nexus acquisition of TradeCard last year was a game changing move in the Supply Chain Finance ecosystem. The companies were leaders and pioneers in their respective industries and combined, now present a best-of-class cloud-based technology platform that links companies together in vast commerce network. The world’s largest enterprises rely on GT Nexus’s advanced business collaboration to better manage physical and financial supply chain processes on a global scale with thousands of trading partners.

PayStream has monitored this transition closely over the past year. The true benefits of combining GT Nexus capabilities with TradeCard have begun to show; they are now the world’s largest cloud commerce network with over 25,000 clients managing over $100 billion in goods globally. Verticals include nearly every industry from consumer goods and manufacturing to pharmaceuticals and logistics. GT Nexus reports that the best supply chains synchronize the movement of goods, funds and information seamlessly. Their solution does exactly that, from order issuance to shipment to payment, GT Nexus enables users to improve working capital, reduce risk and cost of goods and increase visibility and agility between trading partners. By leveraging early payment programs, pre- and post-export financing, payment protection, and local expertise, users achieve greater returns on cash, enhanced supply chain working capital, and improved order fulfillment and payment protection which yields a lower cost of goods and favorable financing rates.

PayStream Advisors will continue to monitor this industry leader and are excited to see what they have in store in the future for the supply chain finance market.

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