Integration. One word, plenty of power, especially when it comes to procurement and financial business operations.
Over the past decade, we’ve seen explosive growth in the availability of business applications and extensions, especially when it comes to procure-to-pay processes. Just like the consumer world, in procurement and finance, if you have a need, there’s an app for that. But this shift – which has led to the consumerization of business systems and enterprise IT – creates silos across departments, inefficiencies for employees and data errors for the organization. Effective integration fixes that. It seamlessly standardizes and connects what was previously isolated so companies can easily collaborate, increase control and create wins across the entire enterprise – all while retaining access to best-of-breed, modern tech innovations and keeping the financial system up to date.
Procurement leaders know that when employees have access to technology that offers them a consumer-like buying experience, adoption increases, resulting in more realized savings and more visibility. But how can they ensure corporate controls are maintained? This is only achieved with the proper integration of existing IT infrastructure, financial systems and cloud-based procurement data.
Digital Connectivity Creates Seamless Experiences and Reduces Manual Work
Digitization and cloud connectivity are key to effective procurement data on the cloud. For employees, digital connectivity means they can work from anywhere and everywhere, without having to worry about going into the office to access key systems. Business system connectivity also eliminates the time and resources that are typically necessary to manually move data.
Do you know how much time your team spends moving financial and purchasing information from system to system? Do you know how much paper you have slowing you down?
Without integration, the answer will always be, “too much.” Integration automates key processes like validating vendor invoices, purchase requisition approvals, delivery of POs and ensures the financial system is updated with liabilities and credits due by enabling seamless system-to-system connections. This frees up your purchasing and procurement teams to spend time on what really matters, like high-impact, strategic projects that drive innovation, uncover savings, and create bottom-line results.
Integration Leads to Better Spend Management
A recent Deloitte survey found that CPOs identify cost management as their top priority right now, with two-thirds of organizations planning to pursue cost reduction strategies post-COVID-19 (up from 33% pre-pandemic). Procurement and financial system integration help make these goals a reality. When financial, AP and procurement systems are fully connected and integrated, procurement gains a better picture into spending, budgets and cash flow, enabling the organization to achieve higher levels of spend under management.
For example, set budgets that exist in financial systems should automatically communicate with procurement systems, allowing for real-time, accurate budget checks and spend approvals. Invoices from vendors are immediate and digital, and payments are always accurate and sent on time, with the right info and to the right supplier. Purchase orders are automatically matched to inventory items regardless of the format they came in, not only saving hours of manual processing but also reducing inaccuracies. Digital receipts ensure what you ordered and paid for is what you received – a key control as well as a necessary piece of information when analyzing spend and supplier performance.
Integration for Increased User Adoption and Enterprise Control
Consider the nature of enterprise purchasing. According to a Spend Matters article from earlier this year, “enterprise procurement leaders need deep and feature-rich solutions that enable them to find, maintain and control spending and savings. Employees, on the other hand, need a simple, consumer-like buying experience that allows them to get the goods and services they need quickly and seamlessly to more successfully run the business. Often, those two goals can be at odds.”
Enterprises with effective integration strategies overcome this issue and gain access to the best of both worlds. They can provide their employees with modern, user-friendly technologies – like a consumer-like, digital marketplace for business purchasing – while maintaining robust enterprise procurement controls. When systems are easy to use, employee adoption rises – which simultaneously cuts down on rogue spending and maverick purchasing, and increases spend under management.
Making it Happen
The beauty of procurement and finance integration: you don’t have to rip and replace existing systems and processes. The ability to connect modern, best-of-breed digital apps with ERP and financial systems helps you capture more value instantly and extends the benefits of current investments. The key is making sure you ask the right questions and select the right procure-to-pay solution that doubles as the right integration partner. By connecting modern procure-to-pay solutions to existing financial and ERP systems, you can achieve game-changing improvements to employee adoption and business spend management, while providing a robust and feature-rich solution that enables leaders to find, maintain and control spending and savings.
Integrating financial and procurement systems is a must for companies of all sizes. In today’s climate, where surviving – and thriving – means increasing financial visibility, controlling spend and reducing costs, best-of-breed integrations can connect with core systems and break down silos, offering new ways to maintain budgets and generate business wins. With results like that, what’s not to love?
To learn more about the value of integration, check out this post on Spend Matters.