There exists one golden rule of business operations: Any process can be streamlined.
And quite frequently, it can be combined with other operations for a more efficient result.
That’s because no matter the method or how long it has existed as status quo, it will eventually be disrupted.
After all, nothing is perfect, and the forward march of enterprise progress is inevitable — and increasingly digital.
Oded Zehavi, CEO at Mesh Payments, tells PYMNTS that now, digital-led processes are coming for the procurement space, allowing firms to modernize the purchase-order-to-payment process and better navigate the challenges of today’s operating environment.
“The procurement space has been evolving at a rapid pace over the past two years. … If we look back historically, a company would not have a procurement function before they had a few thousand employees, minimum — procurement was usually done by IT, finance, or HR without any specific focus,” he explained.
Part of the reason was because smaller companies inherently had fewer vendors, making a procurement department superfluous.
But the rise of embedded finance has prompted nonpayment companies to incorporate payment capabilities into their existing platforms, and this has resulted in silos and the use of different vendors for various payment use cases, leading to inefficiencies and complications.
The result? A disjointed process that requires users to login to multiple systems to manage payments (invoices, corporate card transactions, personal card reimbursements, etc.), with each system requiring its own workflow and compliance process, and no centralized view of all their spend.
See also: Spend Management 2.0 Is Connected and Contextual
Zehavi said he sees three main payment contexts ripe for integration: travel and expense, procurement and spend management.
“When it comes to the payment piece, bigger companies have three different solutions — they look at the different payment contexts almost in a siloed approach with different teams for each,” he said.
That means three different vendors providing three different technologies that firms need to negotiate with separately to get better incentives and terms when it comes to their own payment.
The trend of digitization has brought about an appreciation for transparency and oversight, and by integrating procurement with spend management, businesses can enhance their processes.
“[Integrating procurement and spend management] streamlines the procurement payments process and creates efficiencies by eliminating human error and mitigating compliance risk, while at the same time dramatically increasing payment flexibility and improving the requestor experience,” Zehavi said.
By centralizing payment operations, these platforms streamline the reconciliation process and save time for finance teams, leading to improved efficiency and cost savings.
Read more: Business Spend Management Goes Real Time as CFOs Conserve Cash
As finance teams shrink, Zehavi said, alternative options for procurement and payment become essential.
And as the CFO stack modernizes, card payments are emerging as an attractive option for B2B payments.
Part of that reason, Zehavi explained, is because card payments are real time and can be relatively easily reconciled.
“It saves so much time for finance teams … even though historically there was a feeling that vendors don’t like it, they prefer the less expensive checks, check delays and inefficiencies across other B2B payment instruments add a lot more manual labor to today’s vendor operations,” he said.
Separately, business card payments provide immediate visibility, which can help firms with cash flow analysis — something more important in today’s challenging macro environment.
“Technology will save you a lot of time and make your data much more accurate,” Zehavi said, “but many, many businesses still use outdated technology and platforms.”
That, Zehavi told PYMNTS, is why Mesh Payments is launching a new, system-agnostic procurement payments solution, Mesh ProcurePay, that works with any procurement and any enterprise resource planning system in order to consolidate payments from procurement, travel, expense spend, and more.
The solution allows procurement teams to build on existing processes and seamlessly automate the capture and data alignment across procurement, payment and accounting systems to track purchase-order spending, enhancing compliance and accelerating month-end reconciliation by giving visibility across a firm’s spend via a single source of truth.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
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