Good reasons for P2P automation in SAP® environments

The age of digital acceleration is upon us, and the role of corporate finance in this pivotal transformation is becoming increasingly important. In the last five years, the number of finance executives responsible for their companies' digital missions has more than tripled. ¹

However, the introduction of digitization alone is not a panacea. The initial shock of COVID-19 forced many companies to accelerate or even improvise their digital initiatives without a clear vision or strategy beyond short-term survival. Now that the biggest shock is over, some major upheavals and changes well managed, it's time to rethink not only the profitability, sustainability and ROI of existing digital investments, but to create a stronger, more strategic financial plan.

But if the last two years are any indication, the future is unpredictable, and we can prepare for it. It is therefore incumbent on CFOs to recognize and embrace their new, expanding role within the business. Chief financial officers must lead beyond the balance sheet and re-brand themselves as architects of the value creation, change and resilience that companies need to grow over the long term.

This is where procurement and accounts payable come into play - traditionally they have often played a subordinate role in companies. Yet the entire procure-to-pay (P2P) cycle is an important strategic component because of the ability to manage how and when payment is made. Today, P2P teams have a far greater impact on the overall financial health of an organization. That's because procurement and accounts payable are less about data processing and more about strategy and analysis.

Although P2P has so quickly become a value-added strategic business function, traditional, paper-based invoice processing and management is still found in many procurement and accounts payable departments. According to a study by Ardent Partners, the average company still receives 56 % of its invoices in a manual format, meaning paper, PDF, email or fax.² On the management side, performance monitoring is also still largely performed manually. This highlights the need to modernize performance management systems. Traditional methods of P2P processing are associated with higher costs, lower visibility, longer processing times, and a host of other negative impacts that ripple throughout the enterprise. If left unchanged, they can ultimately stand in the way of business progress and gaining a competitive advantage.

Clear the stage for P2P automation

Today, most companies have an electronic tool to automate parts of the P2P process and other business processes, such as an ERP system like SAP or other business applications. While these are great tools for streamlining the payment process, there are numerous challenges that they cannot solve. Companies with ERP or business applications certainly reduce paper and inefficiencies in their processes, but many ERP vendors are not investing in the features that truly optimize P2P (e.g., AI-based data extraction, mobile apps, catalog management, etc.). Deeper P2P automation in an SAP environment helps fill the functional gaps not covered by ERP or business applications.

Three of the top ways an organization can reduce costs through P2P automation:

In addition to pure cost savings, transparency and improved cash flow management are key automation goals. Actionable KPIs and customizable dashboards that go beyond just performance tracking and provide instant access to invoices in the pipeline are desirable. This type of improved control and monitoring enables all stakeholders to complete daily tasks, monitor key metrics, better forecast cash usage, and determine the best approach to taking advantage of discounts.

Advantages for all process participants

Esker's automated accounts payable solution has been certified by SAP for integration with SAP S/4HANA® Cloud and is available in the SAP Store. This step demonstrates Esker's ability to deliver solutions that meet the quality requirements and standards set by SAP. The certification also gives companies confidence that Esker's solutions are compatible with their SAP S/4HANA® cloud software and with future upgrades.

Nowadays, it is no longer enough for a solution to integrate with SAP technology. Above all, it must demonstrate the power of such integration. By complementing ERP systems with Esker's AI-driven automation solutions, companies can better manage even difficult business conditions.

^{1 Mastering change: The new CFO mandate. October 7, 2021. Mc Kinsey & Company}

^{2 State of ePayables 2017: The Convergence of Cash, Suppliers, and Intelligence, June 2017. Ardent Partners}