7 Major Myths Business Organizations Believe When It Comes To Procure To Pay Software

Cutting down the major costs and driving drown to the supplier margins is what organizations have been expecting in terms of procure to pay software. And though the organizations have realized that procurement function is capable of doing much more than what is generally expected, it is still considered to be a strategy of marketing sales or finance. Given below are the 7 major myths business organizations generally believe when it comes to procure to pay software ensuring that procurement has always languished on the backbench of the organizational importance.

Procure to pay software helps in controlling the expenses and that their job but not a contributing strategy: We all have heard this before. When it comes to procure to pay software the procurement responsibilities are completely transactional, where you need to handle the requisitions, managing the on time deliveries of the requirements at the right place and at the right time. But when it comes to strategic decision making procurement strategy there has been no expertise that would help you contribute. Organizations who believe this should probably take a step towards the dark ages into the 21st century.

Individuals related to procure to pay software just get in the way and complicate things: Individuals related to procure to pay software make things happen in the right way and the right resource. This again takes a huge effort to upfront, and should be seen as an opportunity that would help you get things right. Complications would here continue to arise due to lack of consideration but again is not the case of procurement.

Direct procurement functions cannot be outsourced: While the major functions such as the vendor spend management and vendor relationship management are the two important things that need to stay with the customer organization, many number of other procurement activities to this have been deployed and outsourced. Functions like demand planning and forecasting, commodity price tracking, transactional purchasing and many more have been outsourced over the years.

Procure to pay software is nothing more than glorified outsourcing: Procure to pay software here generally means considering different options, and looking out for opportunities that would not just allow you think creatively but also forge in a new and better manner. Outsourcing here is considered to be a potential strategy that has its own appropriate uses and is not the only option available that is put to place.

Procurement recruits need to be good in numbers in order to manage the costs: Different kind of traits have been put forward when the requirements for all the procurement professionals are put forward during the job searches. Say for example when it comes to analytical he needs to be good in numbers and has to be a tough negotiator. And as mentioned above the role of procurement was logistical, clerical, with the only aim of getting the best cost saving and these traits would definitely do. The need here for now is for a new breed of having good procurement professionals.

Procure to pay software leads to the loss of control in strategy and processes: When it comes to procure to pay software, the procurement vendors are the one who are well integrated and act as a virtual extension of all the customer procurement functions starting from the adoption of strategic goals to the operational culture. The customer would then here continue to exercise his control over the different aspects of procurement function with the vendor.

They always run behind saving costs but forget considering the business they have been doing: Cost is a major factor when it comes to procure to pay software and is something that could be considered to be more than a dollar value. Procurement is considered to be good when it highlights the different perspectives and the cost benefits from the business decisions, with savings being one tangible outcome from looking at the situations in a different manner.

These were just a few but there are a lot more to go. So what are the other myths you would like to add when it comes to procure to pay software? How have you been dealing with them? Do leave your thoughts and comments below and we would be happy to add them to the list above.

Author Bio:

Shivli Ratul is a freelancer and has experience of over 5 years in expense and travel management softwares.She has in-depth knowledge about managing travel and different type of expenses incurred in business.she writes about Procure to pay software as a freelancer

PM Building Relationships: RESPECT

Mutual respect is one of the hallmarks of a successful relationship. To gain respect in a business environment, it is important that the two groups understand each other’s roles and responsibilities. One way of developing this understanding is to have members of the two groups work closely together. Depending on the nature of the project, the project team may benefit from having someone serve a “tour of duty” in the customer’s department. By functioning as a member of the department for a few weeks, the “tourist” will learn how the customers work and—just as importantly—why they do things the way they do. This can be invaluable, particularly when the project involves reengineering the customer’s procedures.

Although it is less common for customers to serve a tour of duty, they can benefit from a briefing on the team’s organization and the tasks that are involved in completing the project. Without that, they have no way of understanding the complexities of the typical project and may become frustrated with the length of time required to complete what they believe to be a simple task. 

Differences Between Staff Augmentation And Outsourcing

Characteristic	Staff Augmentation	Outsourcing
Company contracts for	Individual contractor’s work	Predefined service or product
Selection of staff to perform work	Company’s (company staff interviews prospective contractors)	Outsourcer
Day-to-day direction of staff provided by	Company	Outsourcer
Pricing	Time and materials; hourly rate or per diem	Fixed price, typically payable monthly or on completion of specific deliverables
Location of staff	Company site	Either company or outsourcer’s site
Co-employment concerns	Possible, if lengthy assignment	None
Measure of success	Individual tasks	Deliverables
Key to success	Individual contractor	Outsourcer

Characteristics Of Successful Leaders

The five types of power: coercive, reward, legitimate, expert, and referent.* Coercive power, as its name implies, involves forcing others to comply, normally by threatening punishment or penalties. Reward is the opposite side of coercive, in that it promises something positive if the individual complies. Legitimate power is based on the authority managers have through their position within the organization, while expert power resides in the manager’s personal experience or expertise. Referent power is the result of a person’s charisma. 

Risk Management Basic Steps

Risk management should be repeated at various stages of the project. Although the scope under consideration will vary with each iteration, the process remains constant. The four basic steps are:

1. Identify the risk.
2. Evaluate the potential effects and severity of the risk. 

3. Prioritize the risks.
4. Develop a mitigation plan. 

Tools For Determining Customer Requirements

Tool	Advantages	Disadvantages
Surveys	Relatively inexpensive to administer; require minimal effort from team	Unless carefully constructed, may not elicit important information
Focus groups	Provide opportunity to digress from agenda and discover underlying problem; group setting may encourage participation and “building on” another’s response	Require more time to conduct than surveys; group setting may intimidate some participants
Individual interviews	Excellent way to discuss sensitive topics and to obtain specialized information that might be boring to others in a group setting; ideal for people who are uncomfortable in groups	Most time-intensive method
Site visits	Excellent way to see the effect of problems and to meet customers who would otherwise be inaccessible	Can be expensive; customers may be unwilling to host site visits
Customer complaints	Lowest cost	Provides only one perspective; does not address problems that other customers have not expressed; unbalanced, since it does not include positive comments

Types of Customers

◾ External Customers. These are normally easily identified. In the case of GWC and IW, these were the companies who purchased their widgets. They were not, however, always the ultimate customers.

− Ultimate Customers. These external customers can also be classified as end users or consumers. If Great Auto, one of GWC’s external customers, incorporates GWC’s widgets on the cars it manufactures, the person who buys one of Great Auto’s cars is GWC’s ultimate customer.

◾ Internal Customers. These are the company’s departments and individual employees who use a product or service. In the relocation project, they are primary customers, since the majority of the work that is being done is for their benefit. Internal customers come in two varieties: immediate and intermediate.

− Immediate Internal Customers. These are the departments that are directly impacted by the project. For the relocation project, that includes all employees. If the project addressed the manufacturing process, with the end product being a finished widget, the immediate internal customer would be the Packaging Department, since it is the first department to use the widget.

− Intermediate Internal Customers. Intermediate customers stand between an immediate internal customer and an external customer. For the relo- cation project, there are no intermediate internal customers. However, using the example of the widget manufacturing process, the Shipping Department would be an intermediate customer. Shipping receives a product or service (a widget) from the immediate customer (Packaging).