P2P: Optimization case studies
Top-performing companies promptly evaluate functions to identify opportunities for improvement. This is done by analyzing business processes to understand current activities and ownership, benchmarking against peers and aligning stakeholders on the need for change. Subsequently, they develop an implementation roadmap that encompasses quick wins, business case considerations, resource constraints and the appropriate pace of change.
These organizations establish a transformative program by implementing an effective structure that includes cross-functional accountabilities, program management and governance to drive execution and achieve optimal results.
Below are two case study examples of how companies can benefit from P2P optimization efforts:
Case study #1
The challenge
A large global telecom company lacked an integrated P2P process and a central circuit inventory to manage supplier contracts and validate invoices.
The solution and key results
The company moved from a manual to an automated invoice validation process. This uncovered significant issues with existing invoice management. Contract data cleansing resulted in $25M in annual savings from ceasing inactive circuits. To mitigate risk, a supplier contract analysis was completed that proved contract minimum penalties of $24M were invalid and, furthermore, generated $4M of additional incentives for the company.
Case study #2
The challenge
A high-growth $1B+ global transportation and logistics company faced operational challenges resulting from extensive acquisition activities. To enhance the stability and scalability of the company, Highspring standardized key business, finance and operational processes and technology. This included supporting the enterprise data team in optimizing the flow of data among the client’s diverse (12+) systems, which entailed transportation management systems, data warehouses, an ERP and other enterprise applications.
The solution and key results
Following Highspring’s P2P assessment, gaps in end-to-end processes were identified and strategic recommendations were implemented to optimize the NetSuite ERP system. Quick wins were realized through improvements in both the P2P and record-to-report processes. These enhancements encompassed data cleanliness initiatives, the deployment of a leading corporate performance management application, supplier selection for AP process automation and ongoing support for enterprise applications and ERP, ultimately accelerating the close cycle. Advisory support was extended for the seamless integration of a new transportation management system into the client’s ecosystem. Highspring played a pivotal role in consolidating the acquired transportation management systems and streamlining them into the selected future state transportation management system post-acquisition stabilization.
Key takeaways
A thorough evaluation, restructuring and implementation of a company’s P2P activities can lead to substantial advantages. The following outcomes are typically observed:
- 50%+ reduction in close cycle time from improved data and reporting
- 5-15% savings from organization redesign
- 20-25% cost reduction or cost avoidance
- 10-20% process automation or improvement efficiency or cost savings
