Business Strategy

How to deliver world class procure-to-pay performance

February 5, 2016 | Xeeva Team

According to research from The Hackett Group, accounts payable best performers operate with 62% lower costs per invoice than their peers. This indicates a significant opportunity for companies not considered best performers to make significant improvements to their operations.

“AP best performers operate with 62% lower costs per invoice than their peers.”

Key Metrics to Determine Procure-to-Pay Process Efficiency

  1. Price per financial transaction basis
  2. Transactions per full time equivalent (FTE)
  3. Purchasing’s span of control
  4. The period between placing one set of orders and the next
  5. The average cycle time from receipt to payment
  6. Percentage of automated purchases
  7. Degree of automation

What Differentiates Top Performers?

Process Ownership

A clear process owner for the end-to-end procurement through payment process.

Integrated Channel Strategy

Top performers are able to drive requisitions with the right supplier, at the right price, with the right buy method. This is done by establishing a channel design and payment strategy to improve both service delivery and compliance.

Defined Payment Strategy

A defined strategy is essential for developing suitable working capital solutions. These strategies may suggest a high degree of automation, process changes, and talent management opportunities.

Accounts Payable Automation

E-invoicing technology is often deployed across top performers, including automating invoice approval through 3-way match and a defined exception management process. Research shows that the best performers leverage electronic transactions far more than their peers.


Supplier portals provide insights into supplier performance and relationship management. Top performers take advantage of key capabilities such as the ability to view and track everything from order status to standing purchase orders, suppliers’ acknowledgment, and invoice status.

Related: How to drive results with procurement transformation

Summary of Findings

  1. Simplify and standardize the procure-to-pay end-to-end processes at a global level.
  2. Increase the potential for technology-driven consolidation.
  3. Close the loop to process the requisitions in a timely and compliant manner throughout source-to-pay channel optimization.
  4. Offshore-centric procure-to-pay delivery is less of a priority.
  5. Electronic invoice processing implementation is the latest technology, while self-service could be upcoming.