• James Samuels 10/01/2019 07:20AM

    In Procure to Pay

    How do you handle PO approvals?

    I see a lot of businesses where Purchase Order approvals is still highly manual especially for low value transactions - even where ERP is in place. Distributed purchasing, on premise / complex PO software, checking against budgets, multi-level sign-offs, different budget centres etc etc - how good / bad is your business at approvals?

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  • Answers (3)

  • Stephen Rowe

    31/01/2019 10:01PM


    POs approvals process should vary depending on their monetary value. In my view, provided the correct controls are in place, any spend less that $500 should be automatically approved, far too much time is spent approving POs with a value of $5. Low spend can also be managed by a P-Card.

    For higher spends an approval process would be required but depending upon you spend approval limits, sub $10,000 can generally be approved by a CPO or Line GM without the need for Exec approval. SAP also have the ability to set up Umbrella PO's for the total expenditure that would be spent over the FY, each PO raised under this umbrella would automatically get approval until the total sum has be used. This also gives budget control over the project.

    Ultimately the CFO holds the controls over spend approval levels, I always found it useful to talk to them as they also get frustrated with approving PO's for $5.


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  • Ashley Collins

    31/01/2019 07:11PM

    Hi James
    A question that has perplexed many over the P2P journey albeit there are multiple solution platforms in the market today that will rationalize, streamline the efficiency & effectiveness of a organizations P2P / S2S strategy (Coupa / Zycus / SAP Ariba). The key initially is to determine what the current process is (as is) versus what you want the re-defined to look like (to be) as it relates to the incumbent technology (ERP) footprint.
    The process mapping will become the template for an organization's assessment of P2P solution providers in the market as they all come with certain implementation and integration complexity.
    At the end of the day, the major P2P solution suite providers will have a platform to satisfy a business's requirements; the key is determining which provider is best suited to an organisation based upon the user requirements and of course level of acceptable investment.
    Happy to take offline.

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  • James Samuels

    01/02/2019 11:25AM

    Thanks Steve & Ashley

    I appreciate your comments - and agree: process and transaction size/ volume should define the right solution. I'm working with a number of multi-site SMBs where enterprise platforms aren't viable for various reasons. I'm also working with a couple of P2P providers who focus on the smaller end of the market. One of my enterprise clients (financial services) uses SAP Ariba blanket POs but is trying to get more granular visibility and control, so investigating alternatives.
    Three examples - 1) a $30m revenue vehicle recovery business where suppliers are often small repair shops and invoices can be hand written (yes, it still happens). Approval inefficiencies can result in late payments to suppliers. 2) a care provider (±$100m rev) where employees might be delivering care at a patients home or need urgent purchase approvals 24x7 on night shifts and for compliance every order even

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