Tune in to fight friction
Anyone wanting to get a quick rundown on the state of P2P friction, backed up by the results of Tungsten’s recent research initiative with IOFM, should take a listen to the new episode of IOFM’s AP and P2P podcast featuring our own Connie O’Brien, Chief Marketing Officer.
Connie spoke with Mark Brousseau, IOFM’s Director of Advisory Services about the increasing importance of the P2P function to businesses and why large organizations are beginning to devote more energy and resources to fighting P2P friction. It’s the various processes that connect these companies with their Suppliers, processes that vary from one company to another, that lay the foundation for P2P friction, Connie explained. On top of this fundamental divide, large volumes of paper and PDF invoices and the manual processes and inefficiencies that surround their handling, create the basis for most P2P friction.
These inefficiencies come with real costs, with research from the Friction Index revealing that businesses waste 125 hours per week on average, on these manual paper-based processes. The costs are gaining increasing attention, as businesses are squeezed by a tighter bottom line, and pressed to become more efficient. With people caught up in tactical “paper-pushing” responsibilities, it’s difficult for them to find the time for the strategic thinking and changes that would enable greater efficiency.
P2P friction is a problem for small companies as well as large ones, Connie stated, and for Suppliers as well as Buyers. The interdependence of today’s supply chains makes it difficult to isolate the problem, because when one business has a problem, their partners have a problem too.
Often these problems are financial in nature, and Connie pointed out a recent increase in Suppliers who are taking advantage of Tungsten Network’s Early Payment, citing this as a huge area for potential future growth.
As destructive as P2P friction is, the future is trending upward, with Connie citing the current rise in activity and surge in interest around Tungsten’s friction-fighting solutions. This observation was supported by research from the Index showing that businesses feel like they are in a better place with P2P friction today than they were 6 months ago. It may be that momentum is gaining for a more widespread adoption of solutions like Tungsten’s that will enable even bigger rewards.
Interestingly, Connie pointed out, the opportunity for businesses in the US may be especially great, where the Friction Index revealed that P2P friction is slightly than in the UK or EU. With the US having been outpaced early on in the adoption of digital back end processes, it may be that its time is now.
One way to know how close the frictionless future is, and discover what we can do to enable it sooner, is to evaluate the present and track the trends. Tungsten’s ongoing investment in research like the Friction Index will continue to fuel this drive.