P2P - AP & Purchasing

If you are grappling with the costs and inefficiencies of time-consuming and inefficient processes, it may be time to take a closer look at what automation can do for your P2P operation. 

Automation can promote better supplier relationships, establish service level agreements, and help you better manage your relationships with suppliers. Technology can also assist in negotiating better contract terms and prices, creating improved… Read More

By Brian Rosenberg

Let’s examine the point of view of the procure-to-pay process from the perspective of each of the players to better understand the objectives of each operation and how they view the other.

The View from Purchasing

Purchasing departments are focused on one primary objective, to buy the product requested as quickly as possible at the best possible price. They are often measured by their ability to respond to requisitions… Read More

As technology and business requirements evolve, the Procure-to-Pay (P2P) cycle needs to be revisited from time to time by Purchasing and AP to ensure it is meeting both internal needs and the needs of suppliers.

Specifically: a P2P improvement team should be formed to:

  • Define the roles and duties of the people involved in the P2P process;
  • Develop training. Employees
  • Read More

Does it ever feel like AP and Procurement don’t speak the same language? You’re not imagining things.

Often, issues as basic as “unit of measure” and “unit of price” can differ between the two functions, grinding the payables process to a halt and preventing the supplier from being paid.

Here are examples:

Unit of Measure… Read More — To manufacture bottles of pills, procurement orders 100,000 foil tops. But they don’t come as individual

Approaching continuous improvement in a P2P environment can seem like a daunting task. It can be difficult to determine how to begin an endeavor that, by its very name, has no end. Matthew Molter, Manager of Properties and Procurement Support at Meijer, a grocery store chain with 200 locations across Ohio, Illinois, Indiana, Michigan,… Read More


Jess Scheer

Continuing Education Manager, IOFM

Most organizations run P2P in two separate silos: Procurement is responsible for selecting and negotiating terms with vendors and then ordering goods or services from those vendors. And then the purchase gets tossed over the wall to AP to pay for it.

At very small organizations, this distinction is blurred. Procurement and AP may be done by the same person or by two people who sit near enough to… Read More
Process improvement forum link_rev

When AP practitioners discuss improving P2P, the conversation almost invariably focuses on automation. Which technology would accelerate how quickly we: scan invoices, match the invoices to POs, process and then reconcile the payments, etc.?

While various systems can enable improvement, they should not be the first place AP practitioners look to make their processes more effective or efficient. Automation is expensive, and it’s risky if taken… Read More

Process improvement forum link_revPhase #3: Are You Ready to Automate?

Phase 3

Step 5 — Considerations Before Investing in New Technology

One of the most common, and expensive, mistakes made when trying to improve procure-to-pay is investing in a technology solution too early.

It’s easy to fall into the trap: You identify an inefficiency in how the work gets done and think there’s got to be a better way. And in that mindset you’re susceptible to believing that a technology… Read More

Process improvement forum link_rev

Phase #1: Know What and How You Execute P2P

Phase 1

Step One: Define the Problem

Improving procure-to-pay (P2P) isn’t just about squeezing out costs or freeing up time. Poorly run processes can damage your relationship with your end customers and drive away your best employees.

Case in point: At a mid-sized IT services company, the combination of multiple legacy billing systems and no centralized master data system meant that when a customer… Read More

 Process improvement forum link_revPhase #2: Standardize and Specify How the Work Gets Done

Phase 2

Step 3: Standardize Roles and Responsibilities

Identifying how the process should run, and by whom, is crucial to driving improvements

In the first installment of this series, we discussed the importance of: standardizing the language your company uses to describe each piece of procure-to-pay (P2P), knowing how those pieces fit together, and empowering one person to “own” theRead More

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