A Wide-Ranging Overview Of Source-To-Pay Solutions
Sourcing And Supplier Management
In evaluating planning solutions for sourcing and supplier management, it is important to understand that Source-to-Pay framework is comprehensive, end-to-end system for expenditure management. As part of the process, organizations must be familiar with the full supplier lifecycle, from sourcing through to payments and contract reconciliation. It is not merely purchasing or payment solution, but part of an overarching businesstrategy. Here is step-by-step look at how to use Source-to-Pay solution.
Step 1: Research potential solutions
The go-to-market process begins by researching potential solutions to determine which will be the best fit for the organizations unique requirements. Factors to consider include an understanding of the meticulousness of the supplier lifecycle, the cost of implementation, whether the solution provides one platform for end-to-end visibility and management, and the presence of analytics and business intelligence integration.
Step 2: Determine appropriate implementation
There are several implementation options to choose from when deploying Source-to-Pay solution. One company may have dozens of suppliers, whereas another might have hundreds or thousands; the form and extent of integration with the corporate systems, whether in-house or SaaS, are also key considerations. Selecting the most suitable implementation format depends on the complexity and size of companies supplier network.
Step 3: Begin onboarding suppliers
Following installation, onboarding suppliers to the new Source-to-Pay platform must begin. This includes collecting contact information, validating potential vendors and setting up your supplier master data, along with establishing preferred contracts and blanket purchase orders.
Step 4: Onboard internal staff
Ensure the internal staff that enabled the installation are trained on how to best use the platform. Everyone responsible for sourcing and supplier management must understand their role, the features available, and how to navigate the interface. This includes setting up user permissions by role for additional users.
Step 5: Standardize supplier selection process
Supplier selection is an integral part of the Source-to-Pay process. Establish standardized internal processes to ensure the selection of the best supplier from the most cost-effective source. Depending on the sophistication of the Source-to-Pay platform, you may be able to leverage algorithms for cost comparison, which can create substantial savings.
Step 6: Administer purchase orders
The next step is to issue Requests for Proposal (RFPs) and Requests for Quotations (RFQs) that comply with the internal rules defined. Source-to-Pay solutions facilitate generating and issuing purchase orders to suppliers based on the templates created and approved by management.
Step 7: Manage invoicing
The platform should also enable the capture of necessary information for invoicing purposes, manage the payment of suppliers, arrive at satisfactory settlement agreements and store historical data for future analysis. All invoices, purchase orders and other financial documents should all be clearly stored in one place, to help reduce the risk of fraudulent activity or errors in handling financial information.
Step 8: Leverage supplier performance
Finally, the Source-to-Pay solution should enable the monitoring, tracking and analysis of supplier performance over time. This ensures due diligence and compliance with contracts, as well as internal policies and procedures. Through the generation of insightful reports and analytics, the system should identify areas for improvement in the supplier selection and management process, providing an actionable roadmap for benchmarks and future initiatives.
In conclusion, purchasing Source-to-Pay solution is essential for any organization that seeks to streamline its sourcing and supplier management processes. Utilizing comprehensive platform helps ensure that best of breed suppliers are sourced, contracts are managed and payment processed with accuracy and efficiency. Doing so saves both time and money and increases transparency, compliance, and risk management.
