At Valtatech, our team has experience leading over 60 source to pay transformations across the world – we’ve seen it and done it across every industry and organisation type. Whilst each organisation has unique characteristics, we’ve seen a number of common mistakes that organisations make when looking to transform their source to pay operations. Here are the top seven mistakes we’ve seen organisations make in their source to pay transformations.
- An unclear vision on what the future of your operations should look like – It’s such a cliche but you have to start with the end in mind. We’ve seen organisations embark on digital transformation programs with a strong understanding of the technology that they want to deploy but not a clear vision of how they want their business to run in the future.
- Poor understanding of where your organisation is now – The other end of the transformation scale is having a clear understanding of where you are now. This helps to map out both the pathway, and also the people, process and technology opportunities and risks that you will face along the way.
- Focus purely on cost savings – Source to pay transformations can deliver some amazing cost savings results, from automating high volume, low value activities to complete spend visibility and analytics, the opportunities to be more cost efficient are great. However, there is also a huge amount of real business value that your source to pay operations can drive for the broader business. Leveraging high quality supplier relationships to drive innovation has been achieved for organisations that focus on strategic procurement activities that, in turn, drive data-driven value for the organisation. Missing this step you will achieve some cost savings but typically not the full cost savings opportunity in front of you and, more importantly, the opportunity to drive real innovation and best practice through your procurement activities.
- Choosing Technology first – The fun part of any digital transformation is the opportunity to bring in some cool new technology that will make your lives easier and deliver great results. Of course, all technology platforms will make this claim and many organisations end up focussing more on the technology (the fun bit) than the processes and business policies that would enable that technology to deliver on its promise. The result? A great piece of technology that is not fit for purpose. Organisations should map out their existing processes and their to-be requirements before engaging with any technology providers so that they can make an accurate assessment on whether the technology is fit for purpose.
- No baseline data – Do you know how much it costs your business to process an invoice? How about raise an order to buy something? If you don’t you are going to struggle to be able to accurately pull together a business case for source to pay transformation or be able to track whether or not you are making progress.
- No targeted supplier on boarding program – Suppliers are such an important factor in your source to pay transformation but when treated as an afterthought, organisations find themselves with poor uptake of electronic invoicing and sourcing opportunities and failing to realise the expected benefits.
- Poor user training and communication – In our experience we know that end users particularly dislike change and the window to win them over and ensure they become advocates of the system is particularly tight. We have seen that organisations that put user experience front of mind have the most successful rollout of source to pay transformations realising program benefits in-line with expectations.
We know that this is a lot to keep in mind and to help organisations on this journey, Valtatech are starting to release free tools and frameworks to help you to avoid these common mistakes. Our first tool is an online assessment of your source to pay operations that:
- Provides you with an instant maturity rating of your source to pay operations so you can see how your organisation is doing
- Outlines some of the challenges that organisations like yours will be facing based on your maturity rating
- Outlines the benefits that a Source to Pay transformation will deliver for an organisation like yours
- Details the next steps that you should take to start your transformation journey.