Report: Procurement leaders seek automation and integration.
Such a large category of business spend demands an integrated and unified approach, according to the research.
Report: Procurement leaders seek automation and integration.
Such a large category of business spend demands an integrated and unified approach, according to the research.
Understanding the needs of procurement organizations.
Brex partnered with World Business Review to gain insight from 100 finance and procurement leaders on the current state of spend management and the future of automation. This article summarizes some of the results of the report, which includes industry benchmarking data on technology adoption and recommendations for high-impact areas of focus.
Procurement best practices are automated and integrated.
The report uncovered significant pain points associated with the procurement status quo. Many financial and procurement leaders are trying to manage all of their organization's procurement spend and related tasks manually — typically with a patchwork of systems. A lack of automation and integration is leading to errors, inhibiting visibility, and discouraging a culture of financial discipline. This is unsustainable for today’s businesses.
Some finance leaders are beginning to pursue the efficiency, accuracy, and productivity gains of managing procurement spend as part of a unified, AI-driven spend solution — positioning their companies to outperform those that remain with the manual, disjointed status quo.
Lack of spend management automation is holding companies back.
The survey found that 86% of companies are still struggling to automate spend management and apply new technologies like AI. Due to a lack of connectivity between their current systems, these respondents say they are dealing with issues like poor communication, low accountability, and poorly coordinated processes among their many software providers.
But they’re trying to get it under control. In most procurement functions, spend management technology is core to streamlining the source-to-pay process and improving compliance.
The problem is that many companies have individual solutions for each of their various spend processes, like corporate cards, travel and expenses, bill pay, reimbursements, and stipends. Most of the survey respondents (67%) say they use four different spend solutions.
This complex ecosystem of SaaS providers across procurement and T&E makes automation more challenging because multiple solutions don’t necessarily communicate with one another, which creates data silos.
Aggregating data from all these systems makes compliance significantly more complicated too. This complex ecosystem of SaaS providers across procurement and T&E makes automation more challenging because multiple solutions don’t necessarily communicate with one another, which creates data silos.
Aggregating data from all these systems makes compliance significantly more complicated too.
Reconciliation requires additional manual work to calculate data and slows down finance and procurement teams. Downtime in one system can break financial reporting business-wide, causing further disruption.
Automation and digitization are top priorities for procurement leaders.
What technologies and approaches have these leaders tried, and where are they seeing results and potential? It’s no surprise that consolidation and automation are key focus areas.
Automation: 100% of respondents agree that automation projects have driven efficiency and cost savings.
Globalization: 84% say globalization has driven some results, but only 13% have seen significant results. There is an opportunity to embrace additional capabilities — including support of multiple currencies, local-currency cards and budgets, VAT tracking, and more.
Digitization: 97% say they are prioritizing digitization over the next 12 months. Through the digitization of their procurement processes, they can get more control over their spend and introduce advanced solutions like automation or even AI.
AI: 27% say AI has driven results thus far, but most agree that AI has immense potential. Not all spend management platforms offer AI-backed tools that provide immediate benefits, but those that do can move the needle with features like auto-receipt capture, merchant categorization, and fraud detection.
This complex ecosystem of SaaS providers across procurement and T&E makes automation more challenging because multiple solutions don’t necessarily communicate with one another, which creates data silos.
Aggregating data from all these systems makes compliance significantly more complicated too. This complex ecosystem of SaaS providers across procurement and T&E makes automation more challenging because multiple solutions don’t necessarily communicate with one another, which creates data silos.
Aggregating data from all these systems makes compliance significantly more complicated too.
Reconciliation requires additional manual work to calculate data and slows down finance and procurement teams. Downtime in one system can break financial reporting business-wide, causing further disruption.
AI-enabled automation, visibility, and analysis are big opportunities.
Many survey respondents are simply getting by with what they have and haven’t fully experienced a quality spend management program. They still haven’t achieved the level of visibility they need to rein in unnecessary costs and are struggling with outdated processes, especially related to reimbursements.
When asked which process is their top priority to improve, here’s what they said:
Automation (86%)
In addition to being the top priority in general, 69% of respondents noted that expense approvals and reimbursements are the most important workflows to automate.
Spend visibility (82%)
Most respondents (92%) need help gaining visibility and reining in excess out-of-pocket expenses. This is because employees circumvent the PO process or company policy. Or, there’s a lack of automation on the reimbursement side, with separate systems for each type of spend.
Analytical capabilities (74%)
Among C-suite respondents, there is more focus on data quality and intelligence, having experienced data collection or authentication issues in the past.
All three of these processes are technology-driven, suggesting that integration of AI-led spend management technologies will be paramount to achieving their goals in the coming months.
Recommendations for optimizing procurement spend.
Spend management technology is advancing rapidly to streamline and automate how companies delegate, track, and report on non-payroll spending. Look for one that excels in these areas:
1. AI-enabled automation
AI can help automate several processes, such as compliance, expense management, and reimbursements — while increasing efficiency and accuracy.
2. User experience
Usability is often a barrier to technology adoption. Personalized processes for employee feedback and collaboration ensure team members can easily adopt new technology.
3. Data quality and analytics
By digitizing procurement processes, organizations can get more control over their spend data accuracy, analysis, and forecasting.
Read the full report to explore the current state of spend management among finance and procurement leaders in depth. It provides industry benchmarking data regarding technology adoption as well as insights directly from finance, sourcing, and supply chain leaders on automation and the future of spend management.
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