12 May Case study – what does P2P best practice feel like?
We can describe the elements of Purchase to Pay best practice. Centralized invoice management; a purchase order with every invoice every time and to varying extents, many businesses achieve this but there’s another way to look at best practice. What does it feel like? What difference does best practice make to the people in an organization and its culture? How does a business actually transform when best practice is embedded.
Old Mutual plc. is an international investment, savings, insurance and banking group. Established in 1845 in South Africa, it is now a FTSE100 listed company with more than 16 million customers and £293.8bn assets under management. They implemented Perfect Commerce nearly 10 years ago. I asked them what difference has it made to them, not in terms of KPIs, straight through processing and the usual ways of measuring good practice but rather, what difference has it made to their culture and organization.
Charles Lynch looks after the finance systems at Old Mutual. He sees the benefit everyday of a system that is intuitive and importantly, as easy to use and as familiar as the online systems that people use in their every day life to buy things online. Search terms that have meaning to users for example. It sounds simple but many implemented solutions still require people to understand technical language to use a system searching on part number for example rather than generic product name. This makes a huge difference to the everyday life of a requisitioner who can manage the buying of goods and services for their employer as easily as online shopping at home. This was always the promise of e-procurement but, for many organization was no more than a P2P pipedream.
The most dramatic transformation for Old Mutual however is in finance. Rachael Hall leads the account payable team. Her role covers much more than AP but she has seen a remarkable transformation in the business since Perfect Commerce was implemented.
She describes how the AP world used to be. The first that finance knew of corporate spend was when they received an invoice with a “wet signature” on it or when they received a call from a supplier chasing payment. AP staff faced a mountain of paperwork each day – data input, routine and repetitive.
Compare that to the AP world today – data analysis and liaising and working with the rest of the business – playing a strategic business role rather than being a boring back office function. These are the fundamental changes that P2P has always promised yet rarely have been delivered. Finance and procurement a truly integrated into the rest of the business not just in terms of IT but in terms of business strategy and business culture.
This is an extract from a Purchasing Insight White Paper – Transformational Purchase to Pay. To download this free white paper click here