We worked with a large UK telecommunications firm to reduce the time from receiving supplier quotes to purchase order approval.
In one spend category, the average time from receiving quote to PO approval was 46 days, which led to a large majority of suppliers working at risk. The existing process was very manual and time-consuming due to fragmented systems and data management.
The objective
In just 4 weeks, our objective was to:
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Conduct a deep dive into the procure-to-pay process to understand the root causes of the delays
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Develop recommendations to reduce the time from quote to PO approval by at least 75%
Our approach
We collaborated with finance, procurement and operations to conduct an end-to-end process diagnostic. This included:
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mapping the procure-to-pay process end-to-end
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conducting a value stream analysis to establish timings for each stage of the process and locate bottlenecks
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analysing the approval touch points and DoA policies
The solution
We outlined three options to solve the client’s problem:
1: Quick wins and tactical process improvements
2: Process improvement
3: Full end-to-end integrated solution via an S2P Platform such as SAP Ariba or Coupa.
The client selected option 2 which meant implementing the following:
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People: assignment of a process owner for the Procure-to-Pay process
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Process: elimination of duplicate approval touch points
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Process: simplification of the DoA approvers
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Technology: digitalisation of quote and contract approvals
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Technology: enhancements to the ERP system to link contract and PO with associated controls
The result
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67% reduction in the time from quote to PO approval
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95% decrease in the number of suppliers working at risk
