"State of Source-to-Pay" Report Uncovers Innovation-Powered Futur

The new "State of Source-to-Pay Digitization 2024: Navigating Supply Challenges, Embracing Innovation" report by Ardent Partners explores the current Source-to-Pay (S2P) technology market landscape establishing a valuable benchmark for the industry.

As procurement's impact on organizational success has grown, the department's priorities and grown beyond a cost and efficiency focus to also include improving sustainability, mitigating risk, ensuring compliance and improving cash flow. This broader responsibility, coupled with an increasingly complex market, has greatly increased the importance of technology. S2P solutions can free capacity by increasing automation, improve decision-making through easy access to insights, and enable more efficient, effective collaboration with suppliers and internal stakeholders. However, while most large organizations have digitized a portion of their S2P process, the report shows scope and levels of success vary.

Key Takeaways:

• While the results of the survey show wide adoption, it is clear that most organizations have only digitized a subset of the full S2P process. Adoption is higher for core P2P technologies such as Electronic Payments (79%) and eProcurement (51%), showing a focus on transactional processes. On the other end of the spectrum, Big Data Management Solutions (17%) and Optimization-based eSourcing (15%) have low current usage but greater planned adoption, highlighting ongoing efforts to address data management and supplier visibility challenges.
• Going forward, 30% of respondents expect an increase in S2P operations' technology budget for 2024 compared to 2023, while 13% anticipate a decrease.
• The findings show a wide range of benefits for procurement organizations, especially, greater efficiency (57%) and improved productivity (49%).
• However, despite the broad range of advantages gained thanks to S2P technology, many organizations face sizable challenges when trying to capitalize on their investments. In particular, poor data quality and/or access within the technology was identified by nearly half (48%) of respondents as the main barrier. Lack of integration is another prevalent issue both between S2P technologies and third-party systems (34%) as well as across different S2P processes (33%).
• Nevertheless, only a surprisingly low 10% place importance on data architecture, quality, and access when selecting procurement and Source-to-Pay technology. Integration to back-end systems was also identified as a priority by a mere 5%.