Why a S2P solution didn’t solve all your procurement challenges
“Because a software implementation alone doesn’t change processes, it also doesn’t magically improve your procurement strategy and most definitely doesn’t change behaviour.”
That would be the short answer to our title. Now let’s dive in a bit deeper and analyse the real situation.
Implementing a new piece of software or upgrading to a better software version is usually seen as an improvement. However, when it comes to procurement, more than any other department, any change made can affect processes in other parts of the business. Also, uncontrolled changes can be costly as they affect the way in which users interact with procurement on a day-to-day basis, from the way in which they buy things to the way in which invoices and approvals are being managed.
Here are the top 3 reasons why a S2P solution didn’t solve all your procurement challenges:
1. It was treated as a stand-alone software implementation
Besides the fact that any change in the procurement process will affect other parts of the organisation, these changes should be part of a bigger solution to an organisation’s procurement challenges. A S2P software implementation should come as part of a strategy to improve the overall buying process.
Procurement as a business function needs to have a primary purpose, or mission, which is agreed and understood by all its stakeholders. To support this purpose, there should be a clear vision of how it will be achieved, a direction and a comprehensive plan for the journey.
When doing a procurement strategy review, it’s common practice to bring in external procurement consultants who can help you get holistic view of your procurement organisation and a better understanding of the areas that can be improved.
In some cases, S2P software will be part of the answer to your organisation’s problems, but it is never a universal solution that solves all your procurement challenges and should be regarded as one step out of many on the journey to improving the procurement strategy. More experienced procurement consultants will ensure the organisation is aware and understands this rather than just selling them the dream.
So, after an in-depth analysis of your procurement strategy and processes you’ve come to the conclusion that a S2P software implementation is the right way to go. In order to make it work you need to build a strong and comprehensive business case, which caters to your procurement needs and ensures you chose the right solution for your business.
You can read more about creating a compelling e-procurement business case in this article we wrote for SpendMatters.
2. Processes and policies were not re-evaluated as part of the S2P implementation process
A S2P implementation project is a good chance to review policies and processes and assess their effectiveness; perhaps even change policies that are outdated.
This should be done as part of the strategy review process and we believe this is a step where external expertise can be of great help. Sometimes bringing in third-party procurement consultants can help organisations uncover issues and solutions which they didn’t think about in the past. Sometimes we’re too wrapped up in our own world and having a team of external procurement consultants analyse the situation can create opportunities for innovation.
Implementing a new S2P solution implies a change in the way the organisation buys goods and services in the way it interacts with its suppliers and with the AP department; and it can even imply a change in the invoicing and PO process and the roles procurement personnel plays within the organisation. We’re implying here that employees might need to learn new skills to adapt to the new system. This is where a good change management program comes in hand.
3. A S2P solution was implemented but change management was neglected
Change management is a crucial part of every software implementation project. It prepares the internal and external stakeholders for the changes that are coming and allows them to adapt in due time.
An important thing to note is that change management starts the second a S2P project starts and continues beyond the end. Without a proper change management program, the chances for a S2P solution to not deliver results increase exponentially.
Secondly, organisations should once again go over their business case and ensure they have a good understanding of the project and its objectives. This in turn will help organisations identify and spend time with all the stakeholders impacted by the changes, involving them in business decisions, and helping them support project delivery through the change channels identified.
We need to understand that the project has a different impact on different layers within different parts of the organisation. From a user perspective, having a system that meets business processes whilst making life easier for the end users, is vital. At a more strategic level the new system should show that the organisation is running an efficient and cost-effective back office.
To summarise all of the above, first of all a S2P implementation project should be strategic, meaning that it shouldn’t be regarded as a stand-alone software implementation, but as one of the steps that should be taken when the organisation decides to update their procurement strategy. Secondly, a S2P implementation should be followed by a process and policy review and update. And lastly, change management should never be forgotten or taken for granted.
Change doesn’t happen overnight, and for a new system to deliver at its full capacity, all stakeholders need to be actively involved in the process and need to have the patience to understand it and learn its functionalities.