Taming Maverick Spending in the P2P Process
By Jim O'Farrell on February 20, 2012
So today’s discussion centers around the whole procure to pay process and the related impact of the diminishing role of direct spend with the associated increase in indirect spend. A lot of this change has to do with the “right-sourcing” of traditional industries and the resulting increase of service and information technology companies – less purchase of direct goods for manufacturing (with a smaller universe of suppliers) with increased indirect spend with a vastly larger group of suppliers. All of this makes for a very challenging environment for procure to pay business processing market adaptation, and drives employees to maverick spending due to a variety of systemic issues with sourcing, procurement and payment. And of course this costs companies – in terms of compliance – some estimate that even if 95% of indirect spend is associated with contracted vendors – only 65% actually comply with the terms of those contracts.
This white paper argues that what drives employees to “go maverick” includes incomplete or inaccurate catalog information, cumbersome ordering and approval processing, or purely perceptions of procure to pay processes being perceived as ill suited to indirect spending. And what can overcome these “roadblocks” to compliant indirect spend is a platform built for change (as opposed to built to last) – more on that topic in another blog.
So grab a cup of coffee and check out this white paper for more detail and statistics and see if your company has tamed maverick spending – or if you need a little help corralling those wild horses!
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