Most of the workflow tools also allow an intergration with e-mail system so that when one person finishes his/her task and the responsibility shifts to the next person, an alert is automatically sent to the next person drawing their attention to the task that awaits their action. The email interface can also be configured to send out reminders in case the concerned person does not complete the task within a certain time
1. Reduced costs: Since the service provider supports a number of customers and handle high volumes, they are able to bring down the processing costs. E.g. same manpower can process multiple clients’ invoices. These savings are further enhanced if the services are provided remotely from a low cost country like lndia.
2. Vendor satisfaction: Since the performance improves in an outsourced P2P process, the vendors of the company receive their payments on time. Hence they will be keen on doing business with the client and will be willing to give better commercial terms.
3. Strong and effective internal controls: The service provider is able to implement better controls to prevent financial irregularities.
4. Improved decision making with accurate information: The outsourcing service provider is able to provide better reports regarding the process. This information can provide a lot of useful insights to management to make better purchase related decisions and efficiently manage working capital.
5. Standardized business processes: In a large company which operates over different countries, it is often seen that the P2P processes vary from one location to another. When such a company outsources to a service provider who can support all these different locations, the latter is able to standardize and simplify things into one process. This standardization and simplification brings a range of benefits to the company as the process is much easier to manage.
6. Best Practices: Thanks to their expertise, the service provider is able to advice the client on ways that their P2P process can be redesigned and improved.
7. Freeing of Management time: Outsourcing helps to free up the time of client’s management to focus on their core business.
8. Using time zones to reduce response time: The fact the service provider and the client work in different time zones can be used to ensure quicker response to service requests.
E.g. the work that is generated during the course of the working day in New York can he processed during the working day in India which is 9.5 hours ahead in time. The completed work can be sent back to the US before the start of the next working day, thus resulting in a faster completion time.
Overall the outsourcing of P2P results in lowering the cost of transactions and offering better quality service to the client and their vendors.
A Workflow process is an automated process where diffrent resources (employees or computer programs) perform a series of actions to completes a business transaction. After a resource in the workflow completes the job assigned to it, the work automatically moves to the next resource and waits for it to finish the job. The way responsibility moves from one resource to another can be configured and customized in the workflow process depending on the business requirement.
A scanned invoice image is put into the workflow tool and a workflow request is created against it. This workflow request is allocated to a team member to process the invoice further. The person, who takes up the invoice for processing, compares the data on the digital image of the invoice with other documents (the purchase order and GRN) and then enters the invoice data in the ERP. This clears the invoice for payment. Then the invoice processor updates the status of the workflow request as completed.
A workflow tool is indispensible in an outsourced AP process for the following reasons:
a. An invoice or vendor query, once enterd into the workflow, can be tracked to completion.
b. If for any reasons, a request gets stuck somewhere in the process, it can be located and the underlying issues can be resolved.
c. A workflow tool can provide ready metrics reports which allow managers of the process visibility into the process anytime. This allows them to judge the health of the process and identify potential bottlenecks. It also helps them to make an analysis of the past mistakes so that they can take corrective action for the future. For example, the P2P process manager notices that a lot of invoices are held up for processing with two of the team members and their workload is increasing. Based on this observation the manager can decide to send these to members for further training or provide extra support to them by assigning their requests to other members, till they are able to catch up with the rest of the team.
Most of the workflow tools also allow an intergration with e-mail system so that when one person finishes his/her task and the responsibility shifts to the next person, an alert is automatically sent to the next person drawing their attention to the task that awaits their action. The email interface can also be configured to send out reminders in case the concerned person does not complete the task within a certain time.
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