5 procure-to-pay trends for 2016 - amazon web services · 10.1% 25.2% 47.1% o s n es igh g, g...
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The Accounts Payable & Procure-To-Pay Conference & Expo is produced by: 3/31/2016
5 Procure-to-Pay
Trends for 2016
Rob DeVincent, Corcentric
The Accounts Payable & Procure-To-Pay Conference & Expo is produced by:
2
Rob DeVincent Vice President, Product Marketing
Over 20 years experience in designing
and implementing Accounts Payable
automation solutions
Host of an AP educational Webinar
series
Frequent speaker at various
AP tradeshows including PayStream
Advisors, IFO, and IOFM
3
5 Procure-to-Pay Trends for 2016
Trend #1: SAAS
4
Use of Cloud Technology in AP
Yes 9%
No, but plan to deploy within 6
months 9%
No, but plan to deploy within 12 months
8% No, but plan to
deploy within 24 months
7%
No, and no plans to deploy
67%
Does your AP organization use a cloud-
based solution for invoice
processing?
Source: IFO 2015
5
Benefits from Cloud Technology
2.09
2.53
3.26
3.67
5.00
5.75
5.70
0.00 1.00 2.00 3.00 4.00 5.00 6.00 7.00
• Little to no capital investment
• Minimal IT involvement
• No required software or hardware
• Lower cost per invoice
• Fast ramp-up time
• Reduced risk
• Not sure
What do you see as top reasons driving AP operations to move to cloud-based solutions or Software-as-a-Service (Please rank in order of 1 = most important)
Source: IOFM 2015
6
SaaS and the cloud
Benefits from Cloud Technology
Software
Infrastructure
SaaS – business
model
Cloud – hosting
option
SaaS
PaaS
IaaS
Internet
Mobile
Office
PDA / Smartphone
Home Office Cloud
Provider
Platform
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Benefits from Cloud Technology
5 Procure-to-Pay Trends for 2016
Trend #2: E-Invoicing
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The Case for E-Invoicing
• 0 to 5 percent
• 6 to 10 percent
• 11 to 25 percent
• 26 to 33 percent
• 34 to 50 percent
• 51 to 66 percent
• 67 to 75 percent
• 76 to 100 percent
• Don’t know
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%
56.6%
8.5%
5.7%
5.7%
1.9%
5.7%
3.8%
5.7%
6.6%
What percentage of invoices does your organization process straight-through without any operator intervention?
Source: IOFM
10
AP Is Most Manual F&A Function
0 1 2 3 4 5
Accounts receivable
Accounts payable
Payroll
Tax
Audit & reporting
Source: IOFM
6 = Most manual F&A Function
11
The Benefit of Automation to F&A Functions 6 = Benefits most
0 1 2 3 4 5 6
Accounts receivable
Accounts payable
Payroll
Tax
Audit & reporting
Source: IOFM
12
AP Technology Priorities
3.85
5.00
4.89
5.45
5.24
5.85
7.51
6.98
9.55
12.59
10.74
12.00
12.95
12.78
14.15
15.06
16.64
15.71
18.95
18.63
20.43
18.08
0.00 5.00 10.00 15.00 20.00 25.00
• Front-end imaging
• Back-end imaging/archiving
• Data capture/OCR
• Automatic matching
• Workflow/invoice approval
• E-invoicing
• EDI
• ACH
• T&E automation
• Outsourcing
• ERP integration
• Automated tax/legal compliance
• Automated T&E expense management
• P-card rebates
• AP card rebates
• Dynamic or variable discounting
• Supply chain financing
• Vendor portal
• Business commerce network
• Cloud services
• Outsourcing
• Don't know
Source: IOFM
1 = Highest priority
13
Biggest AP Process Drivers
0% 10% 20% 30% 40% 50% 60%
Reduce invoice processing costs
Decrease invoice cycle time
Improve visibility
Centralize operations
Improve cash management
Integrate payables with other systems
Improve dispute resolution
Minimize litigation impact
Source: IOFM
14
None
5% reduction
10% reduction
15% reduction
20% reduction
25% reduction
35% reduction
50% reduction
65% reduction
75% or more
Source: AIIM
Median
Average
E-Invoicing Delivers 25% Average Cost Savings!
15
6 months 22%
9 months 27%
12 months 13%
18 months 17%
2 years 16%
3 years 2%
3+ years 3%
Source: AIIM
Average Payback from AP Automation
16
Paper to Electronic
5 Procure-to-Pay Trends for 2016
Trend #3: Mobile
18
Source: IFO 2015
Yes 4%
No, but planning to deploy within
6 months 6%
No, but planning to deploy within
12 months 11%
No, but planning to deploy within
24 months 11%
No, and no plans to deploy mobile capture and/or
approval of invoices
68%
Use of Mobile Capture for Supplier Invoices
19
Mobile in Our Personal Lives
5 Procure-to-Pay Trends for 2016
Trend #4: E-Procurement
21
Historic View of Procurement & Payables
22
42% 39%
33%
28% 27%
Savings Processes Compliance Innovation People
Source: Ardent Partners 2015
Today’s Reality: Procurement Priorities
23
Source: The Hackett Group 2015
$16.71 $15.98
$18.00
$10.04
$6.45 $4.80
2009 2011 2013
Best-in-Class Companies are Reducing Purchasing Costs (Per Order)
Peer Top Performer
Are You Falling Behind?
24
Source: Ardent Partners 2015
Between the CPO and the CFO
With Accounts Payable
With Suppliers
With Budget Holders
71%
62%
60%
47%
"Strong" Collaboration
Collaboration Impacts Purchasing Costs
25
Purchasing & Payables Must Be Better Aligned
Source: Ardent Partners 2015
66%
53%
53%
48%
44%
Earlier engagement of sourcing opportunities
New (or improved) technology
Larger and/or more talented staff
Better communication plan
Better team execution
Procurement’s top drivers for future success
26
Source: Ardent Partners 2015
37%
48%
42%
16%
50%
40%
28%
39%
29%
38% 42%
33% 30%
37%
AutomatedSpend Analysis
eSourcing AutomatedContract
Management(Repository)
AutomatedContract
Management(Authoring)
eProcurement ePayables (APAutomation)
BusinessNetwork
Currrently Use Planning to Use
Technology Adoption & Plans
27
Source: Ardent Partners 2015
14.3% Average
catalog-based
spending
28
Source: IOFM 2015
42% Average PO-
based invoices
29
• Reduce spend on goods and services • Greatly reduced processing costs • Less time on non-value add activities • Stronger internal controls • Better visibility into the entire process • Better communication across parties to
optimize decisions and strategies
The Benefits
5 Procure-to-Pay Trends for 2016
Trend #5: Reporting
31
• Key information is not captured
• Data is poorly organized
• Information is not timely
• Systems are not well-integrated
• Decision-makers don’t have access to key variables
Paper Processes Limit Visibility
32
45.4%
38.7% 42.0%
17.6%
10.1%
25.2%
47.1%
Lack
of
visi
bili
ty in
toin
voic
es a
nd
pay
able
sin
form
atio
n
Co
sts
to p
roce
ss in
voic
esar
e to
o h
igh
Dif
ficu
lty
han
dlin
g,m
anag
ing
and
fin
din
gin
voic
es
Inab
ility
to
eff
ecti
vely
max
imiz
e ve
nd
or
dis
cou
nts
Mit
igat
ing
frau
d
Pay
ing
invo
ices
in a
tim
ely
fash
ion
Min
imiz
ing
erro
rs
Which of the following are the biggest challenges in your AP department? (check all that apply)
Source: IOFM 2014 Controller’s Report
Lack of Visibility is a Top AP Challenge
33
18%
41%
39%
2%
Compared to two years ago, has the demand for real-time visibility into your AP financial data changed?
Significantly higher
Slightly higher
Unchanged
Slightly lower
Source: IOFM 2015
Demands for AP Visibility Continue to Rise
34
4.08
4.93
4.50
4.70
3.57
4.32
4.75
0.00 1.00 2.00 3.00 4.00 5.00 6.00
Liquidity management
Cash flow analysis
Compliance measure/risk mitigation
AP/AR/payments management
Managing debt
Managing corporate growth
Reducing costs
Rank the following priorities within the F&A function (Scale of 1 to 7)
Source: IOFM 2014 Controller’s Report
Visibility Drives the C-Suite’s Responsibilities
35
Source: Ardent Partners 2015
Identified or negotiated savings
Enterprise goals and objectives
% of spend under management
Booked savings
Enterprise spend
59%
56%
55%
50%
50%
"Strong Visibility"
Businesses Need Better Visibility Into Spend
36
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
Faster turnaround
Better process transparency
Better auditing
Staff reductions
Fewer invoices "lost in the loop"
Enhanced supplier relationships
More early-payment discounts
Fewer payment errors
Fewer disputes
Ability to outsource
Source: AIIM
Biggest Benefits from AP Automation
37
Dashboards and Reporting Allow Organizations to
38
Reports and Dashboards Provide
39
• Procure-to-pay is gaining more attention • 5 trends will impact procure-to-pay in 2016
• Continued migration to cloud and SaaS • More use of mobile • Increased adoption and use of e-invoicing • Push to align procurement and AP • Heightened demands for reporting and analytics
• Integrating these capabilities into your operations will: • Deliver strong return on investment • Better position your organization against competitors
Conclusion
The Accounts Payable & Procure-To-Pay Conference & Expo is produced by: 3/31/2016
Questions