7 Half-Truths Purchase-to-Pay Providers Are Telling You

7 Half-truths in purchase to pay busted.

As Head of Analyst Relations, I spend a lot of time in product demos, discussing product features and functionality with the analyst community, digging into technology, and harassing our pre-sales team. I’ve gained a wealth of knowledge about purchase-to-pay software – more than you probably want – but what I’ve also learned is that there are some slippery providers out there. They might deliver a slick demo, but there’s quite a bit of information they’re not telling you, and only one party stands to lose in that situation: you.

Keep reading for some examples of how our competitors have offered creative story-telling instead of the truth about what their product can and can’t do.

Half-Truth 1: They are a SaaS Company

The whole truth:

They are on the cloud, but not a true multi-tenant SaaS environment. Every one of their customers is an individual database with a fair amount of customisation within that database. Building customisations into the database makes upgrading more complex for the customer. Because of that, they started allowing customers to skip an upgrade. This means they’re not moving all of their customers to the next release at the same time and are forced to support multiple versions of their software for customers, resulting in costly, fragmented support. And when customers lag on upgrades, they fall further and further behind on staying current with emerging technology and bug fixes, which is not an ideal situation. One of the biggest advantages of SaaS is the access to immediate innovation with every release.  In a true multi-tenant cloud environment, everyone gets the upgrade at the same time and the provider only maintains one single line of code.

Half-Truth 2: They Have a Business Network Connecting Buyers and Suppliers

The whole truth:

They have enabled suppliers to flip a PO in an e-mail to an invoice and are calling that a network in order to compete with larger providers who have built extensive business networks over years. They tend to emphasise e-invoicing as a way to mature your business processes and capture more invoices, and that’s a great goal to work toward, but it’s not realistic that you will achieve 100% e-invoicing right off the bat (or ever). Your suppliers have various levels of sophistication and will not all be able to send e-invoices. A real network offers a variety of solutions, so your suppliers easily connect and send you invoices however is best for them and the network automatically converts those invoices to true e-invoices. You should not have to adjust your strategy and goals or lose suppliers to make up for lacking functionality on the provider side.

Also, you want a network that delivers the most value and that is an open, free network for your suppliers. Connecting your suppliers is critical to your ROI and the best way to do that is to ensure that it’s free an easy for them to join. It should be free for your large, strategic suppliers, mid-sized suppliers, all the way down to your long-tail suppliers. If suppliers have to pay just to send you an invoice, you can bet many will not comply or they will pass the costs on to you.

Half-Truth 3: They Can Easily Integrate with Your Legacy ERP Systems and Procurement Solutions

The whole truth:

Their integration capabilities are light, at best. Legacy ERPs and multi-ERP environments give them serious challenges because they lack the experience and expertise required. They may be able to import an external PO from your ERP, but they can’t match an invoice to it, and they can’t import POs from your other procurement solutions. Make sure you see their integration documentation and let your IT team really dig into the details.

Half-Truth 4: They Offer Invoice Automation

The whole truth:

In reality, they cannot automate a huge portion of your invoices due to a lack of understanding of the AP process, limited technology, and format restrictions. Here’s a few ways they fall down on invoice automation:

  • They cannot process non-PO invoices, direct purchasing invoices, or automate the handling of paper invoices. Some examples include:

    • Mobile phone subscriptions

    • Maintenance agreements and related bills

    • SoWs and milestone billing

    • Complex logistics bills

  • They do not offer automated matching using a combination of invoice, PO, goods receipt, quality check, contract etc. at the line level, header level, or using recognition methods that calculate the best matching scenario.

  • They cannot support additional costs and tolerances not on the purchase order or match invoices and POs when the goods ordered have a price fluctuation within the same day.

  • They do not have a way to automatically extract the data from PDF invoices. They require you to import the PDF in the system, so that you can see it side-by-side and perform manual data entry to get that information into the system. Hello human errors and wasted time.

  • They often ignore paper invoices and have the supplier do a “PO flip” in the supplier portal – putting the buyer at the mercy of the supplier to get the invoice into their system.

  • They don’t even address invoices that result from POs generated outside their system in another external system, which feasibly accounts for a significant number of your invoices.

  • Their coding templates are limited. They may say they have templates that automate invoices for certain non-PO invoices based on supplier, commodity, and the requesting user. But these templates should enable you to use any data from the invoice header or invoice lines to define the proper invoice coding, and that’s often not possible.

The only invoices they can automate are XML invoices for POs generated within their system – not the world-class automation you need.

Half-Truth 5: There’s an App for That

The whole truth:

Conceptually, applications are a great idea – provided that they are built on core platform functionality, and not a substitute for a lacking product. Some solution providers develop apps to make up for what their solution can’t do: automating recurring invoices, creating blanket POs, building an open order report, and other features we would consider central to the purchase-to-pay process. Apps should extend what you do in an imaginative way, not act as band-aids for bugs and gaps. There’s a handful of questions you can ask to dig into a provider’s use of apps:

  • How do the apps extend the user experience of the platform, and why an app over new functionality in the platform?

  • Are the apps created by real developers or the result of internal hackathons?

  • Does the provider offer an adequate description of what the apps do? Is there documentation or other assistance available in-app to users?

  • Are there rigorous quality control standards that ensure the app does what it claims to achieve?

  • Is the provider continuously investing in apps and iterating on the first versions based on customer feedback?

Half-Truth 6: They Can Automate Complex Business Processes

The whole truth:

They will try to convince you to operate within the limitations of their solution instead of working with you to configure the technology to solve your business challenges. Their approval workflows are single-pathed, meaning if multiple people need to approve a document but only need to approve specific line items, each approver still gets the entire document including items that don’t require their approval. Also, the approval path does not split – it flows only linear from one to the next. This is a significant issue on the PO approval side, slowing the entire requesting process down and causing unnecessary confusion and frustration. On the AP side of the house, they cannot truly automate the matching of your invoices to POs, contracts, goods receipts, or other criteria. They only way they “match” an invoice is by having your suppliers “flip” their PO into an invoice in a supplier portal – again not ideal because it puts the burden on your suppliers. Your business will never mature and scale with a solution that cannot keep up with your business today.

Half-Truth 7: They Support Your Global Business

The whole truth:

They may say they are a global company, but majority of their customer base lies in one region, so they haven’t developed a product to address a breadth of global scenarios. With ever increasing e-invoicing regulations and requirements, you need a partner with global expertise to transform your business processes in a scalable, compliant way. They are not a true global provider if they are not offering you:

  • Automatic compliance to major e-invoicing requirements

  • Implementation experience outside of North America and Europe

  • Country-specific solutions for tax compliance

  • Invoice archiving that meets legal requirements in different countries

  • Multiple platform languages

  • Multi-lingual in-country support.

For multi-national organisations, global suitability is a big deal and should not be taken lightly.

The Evidence is Stacked Against Them

With 30 years in the industry, Basware understands purchase-to-pay and the nuances that make a big difference in how much ROI you can expect. Here’s a few ways we’re different and examples of customers that chose Basware because of our ability to deliver a comprehensive product:

100% Invoice Capture

All your invoices – for both direct and indirect spend – must be running through the source-to-pay solution. Most source-to-pay solutions are only good at automating the invoices that originated from the indirect procurement solution, but to get the most value you need to capture and automate your direct invoices, all your non-PO invoices, facilities invoices, invoices generated from manufacturing – everything. The AP side of the source-to-pay system must be a true AP transaction hub for all your invoices, regardless of invoice type.

In a recent deal, an oil and gas company required the ability to handle all invoice types –120,000 invoices/year: 50% paper, 50% PDF. They chose Basware because of our advanced ability to ingest 100% of invoices, regardless of type and format.

100% Supplier Connectivity

You must get all your suppliers connected to your source-to-pay system. Most source-to-pay solutions are designed to connect to the sophisticated suppliers, who can send XML or EDI transactions. But – what about that long tail of mid-size and small suppliers who aren't technologically advanced? What about those suppliers that still send paper invoices? You must have a solution for connecting them to your S2P system, and it has to be easy AND FREE for them.

A large packaging products and systems company sought to go all the way with automation to streamline their business processes. It wasn’t good enough for them to be reliant on their suppliers to perform a PO-flip. They want to enable their suppliers with the right solution that doesn’t require them to change how they operate to expedite the entire invoice handling process, so they chose Basware. 

100% User Adoption

All your procurement must be processed through the source-to-pay solution, which means the end users have to use it – not just some of the end users, or most of the end users, but truly all of your end users have to be putting 100% of their purchasing requests through the system. You can't achieve that status by mandating it, and you can't even achieve it by having a procurement system that is "user friendly."

With advanced functionality like guided purchasing, a virtual chatbot, and Amazon-like experience, the Basware e-procurement solution makes buying the right way fast and easy so all of your users pick it up instantly. The YMCA of the Greater Twin Cities selected Basware e-procurement to get spend under management and focus more on their mission.

Get the ROI You Deserve

Don’t be fooled by the half-truths and lies of omission that some purchase-to-pay providers are spewing – get the ROI you deserve. Want to read more on what to look for? Check out our blog 10 Questions to Ask in a Purchase-to-Pay Demo to learn how you can get 307% ROI.

Senior Analyst Relations Manager, Basware