P2P Strategy: It’s Not Just About the Transaction

Many global organizations have experienced significant challenges when combining their procurement and accounts payable functions to form truly integrated procure-to-pay (P2P) process models. Disconnects between supply chain and finance, the two larger areas responsible for procurement and accounts payable respectively, are not a new phenomenon. Inherently, business drivers of the two functions are different: supply chain aims to create processes which reduce cost and deliver goods and services in a timely manner, while finance strives to establish processes which improve control, simplify accounting, optimize working capital, and ensure proper purchase order (PO) authorization. In addition to these functional alignment challenges, internal customer adoption can undermine even the best P2P implementations. As a result, companies must effectively manage service with control/cost savings.

Developing a well-integrated P2P model goes beyond optimizing “the transaction” or improving processing efficiency. In order for companies to truly transform their P2P model, ScottMadden believes clear alignment across an enterprise, not just procurement and accounts payable, for its P2P strategy must be the central driver for any transformation effort to be successful. In the following pages, we will define key attributes of the P2P model and present our views on how an effective strategy can enable successful P2P transformations.

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Contributing Authors

Luke Martin Director

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