Chief Financial Officers are aware of the need for their companies to digitally transform their operations. Organizational effectiveness and reach have been shown to increase after such a transition. A research scientist at MIT’s Sloan School, George Westerman, describes it this way. Digital transformation is like “a caterpillar turning into a butterfly” if it is executed properly, but “all you have is an extremely quick caterpillar” if it is executed incorrectly. The CFO sees the writing on the wall, but she isn’t sure where to begin the transformation program, specifically which procedures should be digitized first.
It’s crucial to establish support for digital transformation inside the firm by demonstrating early outcomes to peers and management. A digital transformation project’s credibility increases when it provides demonstrable advantages, can be implemented quickly and easily, has few obstacles to entry, and has influence throughout the whole organization. These are important milestones that pave the path for more extensive digital initiatives to get funding and support from upper management. In our role as digital transformation partners for multiple C-suite finance executives, we’ve seen firsthand how digitized expenditure management can significantly improve key performance indicators.
Different names are used to describe the many platforms, suites, and solutions that cover this ground, but they may all be categorized as procure-to-pay (P2P) systems. P2P systems use a centralized network to link all participants in the sourcing and buying processes. This platform-based strategy facilitates cooperation throughout the company and with outside suppliers by eliminating communication barriers. From the lost invoice that always ended up at the bottom of someone’s drawer to the electronic invoice that finds its way to the appropriate departments without any human intervention, P2P solutions provide this kind of facilitation. Improved performance is realized via the use of digital spend management in the form of shorter, more error-free cycles and stronger partnerships with suppliers.
Digitizing company procedures reduces the number of incidents of noncompliance. In reality, the policy transformation from larvae to adults is due to the advent of digitalization. Spend management strategies for companies may be convoluted due to evolution, extraneous material, and the requirement for case-by-case judgment calls. Modern P2P applications have a rules engine that can be customized to fit a variety of different budgetary guidelines and approval procedures, as well as a DOA matrix. With automation, the system can handle the vast majority of expenditure occurrences, freeing up managers to concentrate on outliers and unique circumstances.
Spending on digitization with P2P software is thus the best starting project for CFOs and CEOs to transform the caterpillar into a butterfly because of its high impact, rapid outcomes, and high participation of stakeholders.
Do you use any kind of automated system to manage your purchasing and payment procedures?
DomainRooster”s Spend Management Solutions are the ideal place to begin your organization’s digital transformation. Reach out to us today!
