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Keywords: e-invoicing, compliance, supplier onboarding, P2P, purchase orders
Blog Post | 22 June 2012
Author: Sarah Feurey
Are suppliers and internal stakeholders fully supporting your e-invoicing initiatives?
This week I attended sharedserviceslink.com’s Toning Up Purchase to Pay conference. One recurring theme was: how non-compliance was impeding successful outcomes in Purchase to Pay projects. Namely, e-invoicing.
So my question to you is: how can you get suppliers and internal stakeholders/buyers to play ball?
Without the right incentives, generally people do not change their ways. Here are 5 tips to help you drive positive behaviour and support your e-invoicing intentions.
1. Engage users in the process. If you want people to do something differently, the process needs to work for them. Engaging suppliers and procurement early in the process is crucial.
Educate procurement early on your thinking and your goals. Get them involved in the journey so they have ownership. Have them contribute to the scoping of the project, the building of the RFP, the assessment of the market. Ensure they understand that they will need to ‘own’ the message to suppliers.
Sow the seed with suppliers early. Scottish Water surveyed suppliers on pricing before they started on their e-invoicing journey. The survey revealed that 52% of suppliers spent between £1 and £2 on printing and sending a paper invoice. This demonstrated there was a business case at the supplier end too.
2. Wield a stick. If people can get away with non-compliance, they will. Based on your corporate culture, think about how you are willing to punish non-compliance. Some strategies include:
Charging suppliers a fee for a poor quality invoice
No-PO-no-pay – send that non-PO invoice back!
Rejecting invoices that aren’t automated, but should be
Some companies have a ‘3 strikes’ policy – if you raise orders without a PO 3 times, it becomes a sackable offence. Sounds extreme, but effective…
3. Dangle carrots. Studies show that people respond better when they are rewarded rather than avoiding punishment. So embed your process into the corporate culture. Work with HR to embed KPIs such as purchase orders received as a part of appraisals, reviews and bonuses.
4. Make progress reports visible and timely. League tables of compliance will help you understand where the problems lie. When made visible to the company, people won’t want to be seen at the bottom and will change their behaviour accordingly. Keep this up-to-date so participants can see the immediate impact of their altered behaviour.
5. Stand your ground. As with all change management, senior level buy-in is crucial. When things get tough, you need senior managers to support you. GSK explained that the support from the Head of Procurement and the CFO helped them hold a firm stance with suppliers, and their full support kept suppliers engaged in the new processes.
Look at how you are tackling behavioural change to drive compliance. How many of the above are in your plan? Feel free to add comments on what has worked for you.
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