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Blog

COVID-19. Forcing our hand?

Systems under stress reveal their weaknesses (and their strengths). COVID-19 is certainly causing stress to our economy; governments, schools, and businesses are facing more challenges than ever. Waves of ripples are crashing through all aspects of society, testing our resilience, our creativity, and, at times, our patience.

For many of us, the current environment is all too familiar. Reminiscent of the Great Recession and its accompanying layoffs, people are relying on unemployment benefits, savings, and the helping hands of family, friends, and community. Except this time, with the added threat of substantial health risks through close personal contact, help is best received from a distance. This same principle applies to our business practices as well.

Companies and public agencies are contemplating, or have already cut programs and budgets. The implementation of staff reductions, leave without pay, and remote work practices shortly follow. Organizations whose processes remain largely dependent on physical exchanges of information (approvals, financial transactions, and records keeping) are realizing that continuing to do business in this manner is so grossly inefficient that it’s untenable for a remote or fragmented workforce, plus it heightens employee and customer exposure to a devastating pathogen.

Historical arguments for adopting virtual-based transaction and record-keeping systems have always centered around organizational efficiencies. These arguments are more relevant than ever when considered with the realities of reduced staff cut budgets + sustaining health safety and security increased efficiency to gain capacity and savings.

On balance, the arguments against adopting digital-based systems as being too expensive, too difficult to implement and manage, or too little value-for-price continue to deserve acknowledgment and response. Even if health concerns take preeminence, the realities of funding, status quo systems, and the adoption and sustainability of any new system remain.  These concerns should be included in the due diligence review of technology-based options.

Today’s Imperatives.

The best solution(s) for an organization vary based on operating environment, pre-existing software systems, staff inputs, and budgets. In general, though, the following is a list of common must-haves for organizations seeking to gain business efficiencies, support current goals, and meet future needs. 

  • Simplify processes
  • Increase efficiency
  • Minimize paper handling
  • Reduce transaction times
  • Realize savings
  • Reflect fiscal responsibility
  • Improve transparency
  • Improve customer outcomes
  • Remote / mobile access
  • Data security
  • Easy adoption
  • Minimize staff burden

With these ends in mind, ask yourself:

  • How are we doing in each of these areas?
  • Are there goals we are not yet achieving but could if we tweaked existing infrastructure systems and processes? (enhancing status quo)
  • Do we believe that we have a solid enterprise foundation, but could use improved functionality in specific areas? (adding plug-ins or custom enhancements)
  • Are our systems underperforming or preventing us from substantially achieving our goals? (system replacement)
  • What would an optimized IT infrastructure look like in my organization?

For many leaders in IT, Procurement, and Finance these are the familiar starting-point questions of a continuous improvement gap-analysis mantra. Not even five years removed from the Great Recession, external circumstances yet again force us to revisit these questions in earnest, to problem solve, prioritize, and implement remedies. Once again, we must turn adversity into opportunity and transform our organizations through IT enablement.

No one likes being pushed, but now is the time to take advantage of CARES Act funding, to identify and execute right-fit solutions. We can make it easier for our customers and our institutions to achieve their goals, even during the most difficult of times.

Blog

How To Cut Costs Per Invoice By 200 Percent

During an organization’s ordering process, there are typically a plethora of intricate steps and various factors to consider before an actual order can be placed.

Purchase orders (POs) often involve complex approval workflows, multiple budgets, hundreds if not thousands of suppliers and contracts, endless data, and millions of dollars.

Organizations often struggle with how to manage this process without losing both visibility and control.

It is an even more convoluted issue considering the widespread nature of procurement processes and their interdependence with other departments. These relationships make it far more challenging to determine where and how improvements can be made.

In a 2018 study conducted by PayStream Advisors, now Levvel Research, over 400 organizations were surveyed to determine the latest trends surrounding procurement management.

The following main points were uncovered:

  • Inadequate technology
  • Procedural differences across departments and/or locations
  • Frequent off-contract or off-budget spending
  • Too much paperwork
  • Disjointed systems
  • A lack of visibility and/or control over spending

 

Firms Benefit from Utilizing Email to Send POs

An organization’s control over spending is significantly impacted by PO format and how it is submitted to suppliers. Fortunately, most organizations surveyed are either using eProcurement software or email to send POs. These methods provide more visibility and greater control compared with those organizations using manual or uncontrolled methods, such as over the phone or ad-hoc online ordering.

Reduced Cycle Time: Greatest Benefit to Procurement Automation 

Most mainstream organizations have some kind of automation in place, whether it be a homegrown procurement tool or a built-in tool that is embedded within their ERP system. While these companies have a more efficient way of processing their POs than novice companies, their cost per PO still remains rather high.

Organizations utilizing cloud-based eProcurement tools have very little manual involvement in their procurement process and can therefore process POs at a much lower cost. In fact, their cost per invoice is almost 200 percent less when compared to that of novice and mainstream companies.

Aside from lowering processing costs, other major improvements and benefits to procurement automation include reduced cycle times, improved visibility and transparency, and enhanced control and security.

Is your firm looking to cut costs per invoice? Contact EqualLevel, a platform bringing sophistication to the procurement space.

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