Tungsten Blog
Gary Benson. Click to know more about author.

P2P automation: HP's viewpoint

by Gary Benson 3. January 2012 08:37 AM

One of the reasons we write this blog is to help put electronic invoicing in context. While e-Invoicing is no longer new, there is ongoing demand for good educational material.

A paper that recently caught OB10’s eye is a viewpoint from HP, Transforming the Procure-to-Pay Process. It explores supplier invoice automation and the benefits and concerns holding back adoption. We think it offers a succinct overview that any company looking to streamline its P2P operations will find useful.

HP is well placed to write this report. As one of the pioneers in e-Invoicing, it has been at the forefront of invoice automation for nearly ten years.

As HP says, few organisations have brought technology into their P2P functions in a determined fashion, even though they recognise the benefits of greater productivity, efficiency and visibility, improved relations with suppliers, and fewer exceptions. Fears persist over up-front investment costs, the time it takes to onboard suppliers, possible technical challenges, security, scalability and legal requirements.

But as the paper finds – and we agree – many of these concerns no longer hold water. Technology has evolved to make the technical obstacles obsolete; governments are starting to keep pace with e-Invoicing developments; the experienced network providers are increasing their compliance around the world while sharing and building on years of lessons learnt.

HP shows how its Enterprise Services-BPO offering fits within the invoice automation process flow and explains how organisations can “gain the maximum automation and efficiency from an electronic invoicing environment by partnering with a single, experienced solution provider.” We particularly like how its process flow diagram shows OB10 at the heart of e-Invoicing.

HP concludes by saying it sees invoice automation as the key transformational element within the P2P process. Based on the conversations we’re having with customers, prospects and partners, HP is not the only one who thinks this way.

Download the HP viewpoint

Comments (1) -

Peter Downie
Peter Downie Spain
1/30/2012 7:23:31 AM #


I think an additional point to make which backs up the general message outlined in our Viewpoint paper- is around the topic of Supplier Payment Terms and Supplier rationalisation.

The ongoing economic global crisis and associated credit freeze mean that organisations  more than ever before are  focusing  on ensuring their working capital flow. This focus typically flows down to supply chain management in the guise of pressure on procurement to improve the Days of Payments Outstanding (DPO). Currently organisations look to do that by various methods, typically  by extending payment terms with suppliers, rationalising number of suppliers and In many cases changing the payment logic to pay invoices from the invoice receipt date rather than from the invoice date.

All such initiatives can be seen as best practice from a buyer perspective but of course the squeeze is felt by the supplier who is left with few alternatives. They can either aim to renegotiate upwards the agreed price, risking the loss of business or simply  accept the new payment scenario with the knock on effect of receiving the funds later and the corresponding negative impact on its own cash flow.  Of course the real underlying issue for suppliers which directly affects their acceptance of such a proposal , is how good  the buyer is at  paying on time anyway. Suppliers who receive payment regularly on time from their customer without further need to employ resources to chase for payments are of course more likely to accept any changes requested in terms of payment terms.
In my experience working with our own suppliers as well as the suppliers of our BPO customers, those suppliers that either already avail of e-invoicing to bill their customer or are given the opportunity to do so are far more likely accept any changes being forced upon them because they have more guarantees to receive payment on time regardless of the payment logic.

This point, without doubt, is starting to be understood more widely and for the first time e-invoicing is beginning to rise on the agenda of Procurement and Treasury departments as a means to pursuing their main objectives. Something that for a long time was only a clear  objective for AP teams is now receiving full support across the board in many organisations.

Add comment

  Country flag

CAPTCHA This question is for testing whether you are a human visitor and to prevent automated spam submissions.

biuquote
  • Comment
  • Preview
Loading