By Yan Jin, Manager, EY (Coauthors: David Fields, Sharon Long, Kristin Galiano, Vicki Jarvis and Nathan Kurylo)
Successful businesses constantly adopt technology advancements to meet changing needs. For example, the adoption of source-to-pay (S2P) cloud solutions is an increasing trend. Many companies are either considering or making the investment to move their on-premise solutions to the cloud or adding S2P solutions to their enablement portfolio. The cloud is, in other words, the now and the next.
Cloud S2P solutions can help improve spend management, simplify processes through automation, increase transparency and help align organizations’ procurement technology with digital and mobile strategies. They can also provide business users with a more “consumerized” experience, and help connect supply chain networks in a common format to enable collaboration and generation of real-time data. Hosted by the solution provider, the cloud solutions can incur lower costs and allow customers to focus more on their processes than on software maintenance.
As a direct result of this more “consumerized” and networked experience (with the potential for more catalogs, more content hosting, more direct access to suppliers, and more alignment with digital and mobile), this innovation can help deliver significant benefits, including improved savings, higher compliance through a more integrated end-to-end process, and greater options for financial management of the supply chain that can improve working capital, and reduce cost and supply risk.
Managing the change
CIOs can help drive successful and smooth implementation of cloud S2P solutions with a robust change management approach that is based on:
- Clear communication: The goals and benefits of the cloud solutions should be communicated clearly and consistently across the business. CIOs can work collaboratively with the right stakeholders upfront, and define and communicate a roadmap for supplier enablement and standardized catalogs. And the business needs to understand the future S2P processes and how to work collaboratively with the suppliers.
- User training: CIOs can help with creating the understanding of human interaction points with the S2P processes more than in the past. The days of customizing the cloud solution significantly to fit business specifications are gone, and an even greater focus may be on how to motivate the business to work within a standard process. A validated user group needs to be trained and made comfortable utilizing the cloud S2P solution. This may mean new procurement skills are required – global interaction, analytics, etc. – to operate effectively on a demanding cloud platform.
- Supplier integration: Involving suppliers through collaboration and segmented communication to help show them how the processes work. Reaching out to them for feedback and to understand their pain points and challenges.
- Support model establishment: Establishing a support model after go-live to help sustain the value earned through enablement. Supplier and internal stakeholder support may need to be transitioned to a structure where issues are handled in a methodical way, and intracompany support can be more efficiently obtained to facilitate adoption, alignment and compliance.
- Learning from the crowd: Underestimating the time required for implementation, focusing solely on technology, poor quality of master and transaction data, and insufficient cross-geographic support are some common implementation errors. Being aware of industry-wide trends and common pitfalls can help CIOs avoid common implementation botches.
As with any implementation, involving the right people is often the key to success. During times of disruption, organizations benefit from leaders who can manage technology and also influence people. The cloud takeover of S2P provides the CIO with an opportunity to come forward as the technology and transformation enablement leader. And for the organizations that succeed, there can be a significant leap in value delivered through their supplier collaborations.