Source-to-pay is a critical business process that organizations use to manage the flow of products and services. Source-to-pay involves various sourcing activities to ensure that the appropriate commercial terms are met. S2P is the process of creating an environment where suppliers can provide their products and services to other departments in your organization. The department in charge of managing the S2P process should be able to plan for procurement, budget for expense, and cost savings, and communicate that to the stakeholders. The main goal of this process is to focus on work that needs to be done to get the organization ready for future requirements.
What is source-to-pay?
Source to pay solution is the process of creating an environment where suppliers can provide their products and services to other departments in your organization. Source-to-pay involves various sourcing activities to ensure that the appropriate commercial terms are met. S2P is the process of creating an environment where suppliers can provide their products and services to other departments in your organization. Source-to-pay involves various sourcing activities to ensure that the appropriate commercial terms are met.
Why do businesses need source-to-pay?
In order to be able to track all sales and expenses, you must be able to track what is being purchased and sold to other departments in the company. This process requires the use of S2P software or a vendor who is responsible for integrating the processes with other parts of the company, such as accounting or finance. There are several benefits associated with source-to-pay, including:
Customer satisfaction – Accurate information on what is being purchased helps you avoid duplicate purchases, as well as ensure that the correct supplies are ordered for your business.
Gains transparency – Knowing what you are purchasing means that you will have a better understanding of how your business is operating. This will enable you to create better operations. For more info about source to pay visit our official website.
The S2P Process
Source-to-pay in its most basic form entails the following three steps:
Source: Your organization has information about their needs. These needs are communicated to an organization’s business partners, who provide products and services to the organization. The products and services are included in your organization’s budget and are in the best interest of your organization. So in this example, the budget is about to be approved. From the time your organization decides that it wants to move to a S2P process to now until the process is completed, is where the potential for errors may happen.
Source-to-Pay activities involve various activities from sourcing, negotiation, contract management, and invoicing.
Roles in the S2P process
The people in charge of the S2P are the sourcing and purchasing people. Sourcing people are the ones who do the actual procurement of goods and services while purchasing people are the people in charge of following up and closing the deals.
