Purchasing Insight

Purchase to Pay, Purchasing & Procurement Process, Electronic Invoicing

In a few weeks’ time there’s superb opportunity to network at one of the most important events in the calendar. People from across the full range of the purchase to pay spectrum, from e-procurement and e-invoicing, through to supply chain finance and AP automation will be at the P2P Summit in October. It really is one of those events you should not miss and I’m genuinely delighted to be able to offer Purchasing Insight readers a discount on the admission price.

But you have to act quickly. Register before September 15th 2014 and you pay $795 instead of the usual $1,395 – that’s a 45% discount.

It’s going to be a lot of fun and I’m looking forward to meeting Purchasing Insight readers there.

CLICK HERE TO LEARN MORE ABOUT THE P2P SUMMIT IN OCTOBER

This is how the thought process goes for AP automation:

“Electronic invoicing could save us lots of time. We could automate accounts payable.”

“Wait – this could be to be complicated. We’d need a project manager and an expert. We may have to buy in some software or work with a third party. Actually this stuff doesn’t come free. It could cost a fortune.”

“$1 per invoice must be cheaper than the cost of a paper and manual process but at 1 million invoices per year, we’ll never justify that. Let’s make an incremental step toward automation. We can scan our invoices and handle them digitally.”

Yeah, right!

continue reading…

Something familiar out of context can have a dramatic impact

Something familiar out of context can have a dramatic impact

Joe Hyland, CMO at Taulia, recently wrote an excellent piece about industry disruption in which he highlighted three of the characteristics of a truly disruptive strategy. Essentially, Joe advises: 1. Don’t simply reinvent the wheel. 2. Don’t plagiarize an existing model and 3. Don’t make incremental changes – be bold.

I’d agree with all of that but there’s something that Joe didn’t say – perhaps because he didn’t want to blow the Taulia trumpet too overtly – so I’m going to say it for him. continue reading…

One of the issues that procurement professionals complain about is respect. Or status. “Procurement isn’t taken seriously”. “They only involve us when things get difficult”. It’s a very common issue for procurement in many organizations. I’ve seen it at it’s most extreme in financial services where procurement is so far removed from core business that it really is difficult, for what is considered by many as the the most boring of back office functions, to be taken seriously at a strategic level.

But is this really any different from any other part of business? Perhaps procurement people need to take a look in mirror and frankly, get over themselves. continue reading…

For my sins, I have been looking at the NHS Procurement Atlas of Variation – Metadata, the opening two paragraphs of which read:

The NHS Procurement Atlas of Variation has been developed to deliver greater transparency by comparing the prices paid by different trusts for the same types of products.

This will allow trusts and their suppliers to understand where better value is available and then act on this information to reduce costs (my emphasis).

Discontent with the Atlas has been well documented and I don’t need to rehearse those arguments here. What surprised me was that, even now, after all of the improvements in public procurement in recent years, the DoH could issue a procurement policy document that treated price, value and cost as synonyms and expect to be taken seriously.

This is an antediluvian notion, that procurement is about securing the best (usually lowest) price and nothing else. It is not. continue reading…

It’s not quite a revolution. No-one is fighting in the streets but the world is changing. For decades – indeed centuries, banks have wielded a power over business and the wider economy that was virtually unquestioned. The effect wasn’t always negative of course. It is hard to see how the economic growth of the 20th century could have happened without these institutions. But neither was it all good. There are anomalies in the way the economies of the western world operate  - there are unintended consequences, winners and losers. The fluctuations that occur in our economies are exploited by the banks who have a privileged central position and their actions can amplify the ups and downs in exchange rates, interest rates and stock prices. These accentuated aberrations can be very damaging to economies, businesses and individuals. But there is one aspect of the way our economies have run that hasn’t fluctuated and has always been pretty consistent – you never see a poor banker.

But now there’s a change in thinking. Some of the anomalies that we see – in particular the unfair playing field that exists between wealthy businesses and their smaller suppliers – are now being seen as unacceptable. Extending payment terms in order to optimize cash flow is a good thing only if you take a very isolationist view – if you see self-interest as the only thing that matters. If you take a wider view, you see that delayed payment hurts vulnerable suppliers, it pushes prices up and can damage an economy – at the very least it does nothing to help an economy that is on it’s knees and struggling to get back on its feet. This is why there’s been a change of thinking and ironically, it is the banks we can thank for the change. continue reading…

We’re in the middle of August and there are two unusual things about the summer in the UK. Firstly, we’re having one and secondly, we haven’t seen the scandalous use of purchasing cards in public sector exposed.

I’ve been looking out for the story that emerges every year about the £1 billion spending spree that public sector workers go on each year. Apparently, they use “state credit cards” to fund all manner of things like “taxi rides” and “business lunches”. Food from Marks and Spencer is often quoted as the disgraceful example of a waste of taxpayers money. Daily Mail readers from all over the UK are aghast: “Food from Marks and Spencer! I wish I could afford to feed myself at M&S.” continue reading…