Purchase to Pay

A few weeks ago I visited Israel to meet some of Nipendo's customers. Nipendo are attracting quite a bit of attention from the analysts because of the success they've had in their home country and now that they're making progress in North America and Europe it's important to see their solutions in action to see what all the fuss is about. It was a fascinating trip. Meeting end users and seeing the solutions in action was a real eye opener. Each client was able to share something unique about the transformation that their business had seen through the implementation of Nipendo and collectively they provide an insight into what makes Nipendo worth some serious consideration.

I've become a fan of Nipendo. Nipendo offers, in many respects, what I see as the next evolutionary stage in Purchase to Pay. Rather than simply offering clever means to automate the traditional steps in the purchasing process through things like e-procurement and e-invoicing, they offer what I think of as 'Packaged P2P'. When I visited some of their customers recently I spent time with Eyal Rosenberg, their CEO and we spent quite a bit of that time discussing how the Nipendo platform could be leveraged to offer supply chain finance. And now they've done it and the press release that accompanies their new partnership with Integrate Financial explains the synergy.

Accounts Payable the MovieImagine you're a casting director for a new Hollywood movie about Accounts Payable. I know what you're thinking - a movie about Accounts Payable isn't going to break any box office records - but you never know. Given the right characterization and a decent plot it could work. So who would you cast the AP protagonist? Who could embody accounts payable?  Are they young or old? Male or female? Are they attractive or plain? Sexy? Heroic? Timid? Tall? Short? What does a stereotypical AP person look like? 9 times out of 10 you'd say it would be a woman and 10 times out of 10 you'd say they were a little bit crazy. A little bit crazy to say the least. It's true, AP people are nearly always women and nearly always wired in a way that the rest of us don't understand. They memorize dozens, sometime hundreds of account numbers, cost centers and general ledger codes and they get pissed off when the rest of can't remember them all too. But contrast that with the stereotypical purchasing person. How would finance people cast a procurement person in the movie?

Quite some time ago now I came across a P2P provider, Nipendo. I have to say, the case studies that they presented on their website were quite astonishing. I’ve seen companies brag – quite rightly – of getting very high levels of PO compliance or impressively high e-invoicing stats but when a company boasts of well over 90% straight through processing – that is over 90% PO compliance with electronic POs matching e-invoices with receipt confirmations – it’s more than astonishing. In fact, I didn’t believe it. Some of the largest and most sophisticated businesses in the world have spent years and hundreds of thousands, even millions  of dollars on supply chain process and they’ve not been able to achieve this. So what is it about the Nipendo approach that allows them to achieve such impressive results and let’s be frank about this, are their claims actually true?

On Monday morning I had what I thought was a slight cold. Sniffing, I headed to London. By late morning, it was a proper cold and by the time I arrived in Westminster for the second sitting of Stephen McPartland’s parliamentary inquiry into e-invoicing, I’d developed full blown man-flu. This was a session characterised by contrasts. Forthright opinions together with cautiously expressed views. Good news mixed with disappointing revelations. But overall a great second session.

Ask anyone who knows what they’re talking about - go to any conference on Purchase to Pay and you’ll hear the same thing: The biggest challenge to making P2P work is the disconnect between finance and procurement. I’ve commented on it many times. There are fundamental differences between the way finance and procurement see purchase to pay and getting alignment is not straight forward but there’s another reason why, for some organizations it is a challenge and that is their organizational structure.

Managing P2P in a matrix

To someone in an functionally structured organization, it doesn’t seem unusual. Indeed, if you are used to working within a functional silo, to operate in a matrix environment would seem daunting. How can you serve two masters? How can competing priorities be managed? In contrast, those that operate in matrix organizations view siloed businesses with some disdain. The term “silo mentality” is never used as a compliment. But sometimes, silos are sensible or at least non-negotiable and when that’s the case, the task of implementing P2P is especially challenging.

P2P in a matrix environment