Thursday 18th January 2018,
Payables Place

ePayables Convergence Part II: Supplier Management

ePayables Convergence Part II: Supplier Management

Editor’s Note: Ardent Partners recently published our annual AP-themed report, The State of ePayables 2017: The Convergence of Cash, Suppliers, and IntelligenceToday’s article is part of a new four-part series focused on how the role of the Accounts Payable professional has changed over the last 15 years. If you would like to get the full report, it is available for download here (registration required).

Historically viewed as a back-office function, executives have started to take a hard look at Accounts Payable (AP) operations and realized that it holds untapped cost savings and process efficiencies. As more enterprises identify the inefficiencies of the manual, paper-based AP process, many are looking into AP automation solutions as a way to streamline invoicing and payment approval workflows. Automated solutions not only help to speed up the process, but they also help reduce costs and provide more timely and accurate financial data and reporting that can be utilized. Increased levels of process automation along with more robust data and visibility into the overall AP process mean AP teams are now in a better position for success than ever before and are poised to transform into a more strategic department.

Beyond transactional efficiency, AP can serve as a centralized hub that provides insights and knowledge to help key decision-makers within the organization. This new opportunity will help move the modern AP professional “beyond the basics” of their function. In fact the very future of the AP function hinges on its ability to transform itself into a more strategic unit, and serve as a convergence point within the organization. There are three major areas that are directly linked to AP processes and appear to be the most accessible and prominent ones for AP to pursue in order to reach this level within the organization. The second major area that we are discussing today is supplier management.

Supplier Management

It is important to understand that suppliers should be viewed as a source of knowledge and expertise – a source that can be leveraged for a competitive advantage and mutual gain. In order to take advantage of this, AP teams must work to build a stronger relationship with their suppliers for them to make a larger impact on enterprise operations and overall performance. The speed at which business moves today requires a different level of engagement and alignment with trading partners than ever before. The hallmark of agile and progressive business leaders has been leveraging the strength of the collective supply chain to the benefit of all participants.

For any supplier management strategy to run effectively, an AP team must rely on data. This mainly includes supplier information, supplier performance, supplier quality, and supplier risk data. In all its forms, supplier data is a critical element to understanding how they are performing against agreements and contract terms and also the impact of these vendors on enterprise spend. While procurement teams have long been in charge of supplier management, AP teams should be able to harness the data from invoices and POs and deliver intelligence to the procurement team to help undertake and augment this supplier management strategy. Here are three areas in which AP can leverage the data that is available to them and deliver valuable business insights:

  1. Own the management of real-time supplier inquiries and requests. This may not seem to be a value-added capability, but by owning this attribute of supplier management, AP teams can build a stronger relationship with the procurement function. A critical piece of supplier management is ensuring that the lines of communication as collaborative partners are open and clear. Connectivity with suppliers and internal organizations like procurement will put AP on the course to improve the performance of the overall P2P process.
  2. Manage a master vendor file. AP can bolster the intelligence gleaned from invoices and supplier payments by managing master vendor information. AP departments that hold some strategic responsibility with this information can boost cross-functional supplier information management efforts and expand their value to the enterprise.
  3. Take an active role in sourcing. The modern AP unit now has the information and ability to transfer, analyze, and deliver key supplier information to procurement and sourcing teams. Collaboration and the exchange of information will help the AP unit assume a much more strategic role within the enterprise.


In essence, the entire P2P process involves procurement, suppliers, and AP; and for an enterprise to drive digital transformation “downstream” into P2P “waters,” these processes and stakeholders should seamlessly converge and link with each other. AP leaders should work to link any AP transformation project initiative to the larger P2P process (as should procurement leaders). Ultimately, AP automation should ensure that the data from AP and enterprise systems provides actionable intelligence that is valuable to procurement, and vice-versa.

When a P2P organization is both well-managed and tightly linked, it will be able to become a strategic operation that can support key business objectives. This includes improving contract compliance, reducing maverick spend, tracking supplier performance, and strengthening relationships. By developing proactive payment strategies and pursuing dynamic discounting opportunities, organizations will be able to optimize working capital across the entire P2P process. Executing with precision and looking to take on more responsibility in the area of supplier management allows the modern AP team to become a much more strategic and value-added part of the organization.

Download the new report here, and learn more about how collaboration with key stakeholders has put AP in a position to become a more value-added department within the wider organization.


Download The State of ePayables 2017: The Convergence of Cash, Suppliers, and Intelligence Report

ePayables Convergence Part I: Cash Management

The State of ePayables 2017: Collaboration is the Name of the Game

The State of ePayables 2017: The Next Generation of ePayables

The State of ePayables 2017: The Essential Elements for AP’s Future Success

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