Establishing P2P and Supplier Strategy...Via: Linked‐In Judy Bicking Title Microsoft PowerPoint - A Wed 415 Establishing P2P and Supplier Strategy Judy Bicking.pptx Author enelson

October 15‐17, 2019 | Westin Kierland Resort | Scottsdale/Phoenix, AZ

Establishing P2P and Supplier Strategy

Judy Bicking


P2P & O2C Process Consultant & Certification Author/Instructor

a 27‐year veteran of Johnson & Johnson Global AP/P2P Director of Financial Business

Services

Owner of Nautical Retail Store

Chair for SKD’s Financial Committee


Learning Objectives

Why Establish P2PWhy It’s crucial to convert maverick spend

How to buy smarter How to pay smarter How to qualify suppliers for :

1) value 2) compliance Best practice for on‐boarding suppliers


Why Establish P2P: Change the organizations

perception• Purchasing: slows down the

process• AP: you “just” pay bills

To be recognized as the professionals we are

To bring value to our organization Make a positive impact to the

bottom‐line How to establish P2P which will:

• Be accepted• Gain results


What’s your process?? How does your company pay for expenses

• PO, NonPO, E.R., Check Request, Credit Card, Petty, Cash, Treasury, other

? Define maverick spend? What is your PO to NonPO ratio? Do you have preferred suppliers, especially for

NonPO? How many have a manufacturing plant

• COG’s vs. TCO? Are all your suppliers compliant


NonPO: Maverick SpendWhy control Maverick Spend [non “Preferred”]

1. Compliance2. Price, terms, overnight

charges3. Budget control, Pre‐approval4. Cash Management, Visibility5. Timely, Accurate Financial

Statements6. Efficient process

(no paper invoices, no paper checks)


How to gain Control over Maverick spend?

‐ Need Metrics‐ Where to get the data?

‐ Each Purchase Requisition‐ AP History‐ Budget Forecasts

? Why are these resources rarely used?


How do you access Vendor Master File (VMF) Data?? Where does your vendor master file reside? AP Purchasing Master File Team

VMF, SMF, Tables, Authorization Levels

? How do you access AP History:‐ AP: By Vendor ‐ Purchasing: ??


PROPRIETARY AND CONFIDENTIAL PAGE 9 Slide 9

Example of Commodity Code

This Photo by Unknown Author is licensed under CC BY‐ND

UPC 723175258129 has following Product Name Variations: Aquafina Purified Drinking Water, 16.9 Fl Oz, 24 Pack. Aquafina Purified Water 16.9 Oz Bottles - Pack Of 24.Dec 6, 2018


P2P: Procure to Pay \ Process not People Where to start

Current Map Metrics

Start with:? What do you buy? From Whom? At what cost? Vendor Report Card

Develop new process map


StudyBest Practices to implement:“e” EVERYTHING: Eliminate Paper

• Vendor portal (+/‐)• Imaging & Workflow• Data Management• Pay methods: B2B… B2C

• Supplier Financing (Factoring)• ACH (debit or credit)• Pcards, Traditional or Commercial

• Virtual Cards• Wires• Paper checks


Challenge• New Suppliers‐ Send on‐boarding letter to:

• Collect all info (Laws & Regs)• OFAC• 1099 / 1042• Sales & Use Tax (VAT)

• Legal name from Tax ID• Bank Info for ACH – require!

• Existing Suppliers• Audit the file• Back into verifications that are missing


Welcome Letter• Send to New & Existing Vendors• Written like a Two‐way SLA

• When is a PO required• EFT is required• Where to send the invoice– BP Terms:‐E‐invoice / ePay = Net 30‐Paper inv. & Check = Net 45 or ‐Dynamic Discount

• What else do you need?Where to send the Welcome Letter?


• Focus on people… not the process: ‘he said’, ‘she said’• Preferred Suppliers….. Doesn’t mean Mandatory • VMF• Requestors are

–Special, –High turnover, –System is too complicated

• Change Management• Rely on Checks: {Vulnerable to fraud. US: Highest target}• Pcard 2‐3% points• Wires, very expensive

• Not what ‘they’ really wanted

Roadblocks


Benefits• Perfect Segregation of Duties• Protect the Cash• Gain C‐Suites Support as a Sponsor • Move from overhead to Business Partner• Efficient, Effective, Compliant• Positive impact to the bottom line

• Spend Management * Discount Mgmt.• Soft savings• Budget Control ~ ~ Visibility• Cash Management: under control & compliant• Timely, accurate, compliant FINANCIAL STATEMENTS

NOT just headcountreduction !!!


Purchasing Matrix

You can use this tool to help the client understand which purchasing method is best; based on the type of

purchase being made.

Item PO P‐card In‐house Expense Report

Books 1

Company Gas Card 1 2

Hotel 1

Flowers 1

Food, Non‐Cafeteria 1 2

Office Supplies 1

Repairs 1 2

A purchasing matrix is a tool to help the requestor choose the correct method of purchasing an item

1 – Preferred Procurement Method 2 – 2nd Preferred Procurement Method3 – 3rd Preferred Procurement Method 4 – Least Preferred Procurement Method


Q&A

orIOFM BoothJudy Bicking


Contact Information:Via: Linked‐In Judy Bicking

Establishing P2P and Supplier Strategy...Via: Linked‐In Judy Bicking Title Microsoft PowerPoint - A Wed 415 Establishing P2P and Supplier Strategy Judy Bicking.pptx Author enelson

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