There is a saying that goes, "the deeper you go the greater treasure you will find." This even rings true in the effort of extracting value out of your Source to Pay (S2P) investment, a topic near and dear to me as well as chiefs procurement officers in higher education across the country.
Let’s say that your university has stepped up to make a significant investment in your Source to Pay platform. This investment includes time, money, and intellectual capital – not to mention the overall effort expended to bring these capabilities to your institution to automate and energize your S2P function.
Do you sit back and let the process takes its course?
Unfortunately, I have seen many institutions that have gone down the path of S2P Transformation but find a lack of anticipated results or a disappointing degree of adoption. But why?
The reality is that it isn’t enough to implement these tools and assume it will all fall into place. It takes determination. It takes a continuous, team effort to reap the intended benefits.
I’ll break it down into four main areas, then provide you a list of questions specific to Higher Ed supply chain that you may want to consider to help you determine if your team needs to dig deeper.
Here, I'm simply referring to requisitioning and the creation of that easy, intuitive process that connects your employees to preferred catalogs and content. This encompasses guiding your end-users to access preferred and strategic vendors.
We have become accustomed to easy-to-use online storefronts in our personal lives and its incumbent on procurement professionals to try to mirror this level of "user-friendliness" on corporate platforms. As you look for ways to create these positive interactions, you may want to look at these questions:
- Have you added too many approval steps, making an electronic process too cumbersome?
- How much spend is going through your system versus total spend? And how much spend is with your preferred vendors?
- Do you have enough catalogs in place – are they the correct catalogs?
- Are you challenging your end-users who are not following your guidelines and processes - and more importantly, are there legitimate reasons they are doing this?
- Are you continuously looking for ways to make the end-user experience easier, like moving from 3-way to 2-way matching on low-dollar, high-volume items?
Equally as important is ensuring that you are getting the most out of the tools you’ve implemented to automate your invoicing process. The primary goal of this process is to allow as many invoices as possible to flow seamlessly through your system.
These tools give you the ability to accept electronic invoices either as P.O. flips or via a supplier portal, as well as the capability of electronic and intelligent routing based on your University's approval rules and matching tolerances. Your system should be set up with thoughtful exception processing rules that limit the number of invoices that fall outside of your guidelines, making the process as easy as possible on all parties - and ensuring it keeps running smoothly.
- What is your ratio of electronic to manual invoices?
- Is your staff still opening the mail and scanning invoices? How much data entry is still happening within your department?
- Have you set targets to move vendors from paper-based to the supplier portal?
- Have you considered a digital mail room solution?
The third area surrounds the ability to organize your contracts.
This can be as simple as creating an electronic repository so you have a central location for all your contracts and visibility and electronic “flags” for things like expiration dates, contract owners, and rebate discount terms. It can even extend all the way to contract authoring, contract templates, clause libraries for building your own contracts and electronic signature integration. You’ll want the ability to directly tie invoices and purchase orders to established contracts to ensure accuracy in pricing.
Again, these questions should be top of mind:
- How many contracts do you have in your repository?
- Have you looked at your contracts by department?
- Do you have auxiliary contracts in your database (for example, bookstore operations, dining, banking, and entertainment contracts)?
- Do you have all of your IT contracts loaded? What about athletics, including your pouring rights, media rights, charter bus and air contracts?
- Have you captured contracts from your enrollment management team (such as print, marketing and advertising contracts)?
Finally, start thinking about the technology you have already implemented to automate and streamline your RFP processes through the use of e-RFx tools.
These tools take what we all know is a very detailed and lengthy process, applying much needed automation. In turn, your sourcing team can construct much more effective RFP’s, building a repeatable process and giving you the ability to compete in more sourcing events per year. You can experiment with various auction techniques as well. So:
- How well is your staff trained on your sourcing tool?
- Are they fully utilizing the capabilities within these tools?
- How many events are being conducted per month, quarter, or year?
- Are you tracking the results of these events?
- Have you educated your suppliers on the new processes, and are they responding positively?
Keep in mind that each of these four areas are fully integrated and connected through your Source to Pay platform.
Remember that any investment in a Source to Pay toolset for your university is a smart one. However, it’s crucial to remember that, like any transformation, these journeys require ongoing vigilance, review and refinement.
If your University falls into this category, a firm like ours can take a look at your system and see where we can help to optimize, support, and guide you to ensure you’re extracting the value you were promised when you first implemented your Source to Pay solution. Feel free to reach out to me at firstname.lastname@example.org - I would love to sit down for a conversation.