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Procurement and Finance Outlook Intelligence

McKinsey & Co join Source 2 Pay Summit 2019

December 6, 2018 By ebgnetwork

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Many of you have drawn from their know how, trying to come to terms with how to best develop your organizations. EBG | Network are glad to welcome a great team from McKinsey & Company joining Source 2 Pay Summit 2019. Lisa Åberg, Riccardo Drentin and Fabio Russo will join us sharing insights into how to transform using digitalization and what P&L effect source to pay efficiency  may offer.

Digitizing end to end

Can we take more focus on digitizing processes? One may argue most data is already digital. The challenge in our view are using that data and improving efficiency in ways that give proven strategic effect – end to end. There is a lot more to be done to achieve that.

One McKinsey & Company report (found >>here) even state that only 2% of surveyed companies stated that “that supply chains are the focus of their forward-looking digital strategies”. Altough exhibits showed that “The biggest future impact on revenue and EBIT growth, as Exhibit 4 shows, is set to occur through the digitization of supply chains. In this dimension, full digitization contributes two-thirds (6.8 percentage points of 10.2 percent) of the total projected hit to annual revenue growth and more than 75 percent (9.4 out of 12 percent) to annual EBIT growth.”

Mind blowing! So why is it so hard? For one you should read the topics that will be discussed during Source 2 Pay Summit – all tailored by each moderator, ensuring we stay close to what are actual challenges and ways to overcome them.

Source to pay optimization

Last year EBG came across a report written by McKinsey & Company that resonated with what we do. It is called “A road map for digitizing source-to-pay” and can be found >>here. They define source to pay like this:

We define source-to-pay as the end-to-end value stream that encompasses all the activities required for an organization to obtain and pay for goods and services from other entities. These activities start with the development of specific sourcing strategies to best obtain the goods and services an organization needs. They continue with the selection of specific suppliers, contracting with those suppliers, the placement of orders, the verification that appropriate goods and services have been delivered, and finally the authorization and release of payment. In addition to these core tasks, the overall value stream also includes the activities necessary to support the end-to-end process, such as vendor and master-data management (exhibit).

Exhibit source McKinsey & Company

They conclude: “Large enterprises have not been so successful. Despite significant interest and investment, traditional approaches to automating source-to-pay (see sidebar, “Defining source-to-pay”) have yet to deliver on the promise of a fully digital process requiring minimal human involvement.”

Why is digital transformation so hard?

Even though the potential is evident, companies are struggling to see through the changes necessary to fully benefit from the benefits semi or fully automated processes may offer.

Another report from McKinsey & Company put some light on the challenges. The report is called “Digital procurement: For lasting value, go broad and deep” (found >>here) and begin with the quote “Procurement digitization seems to be on every CPO’s agenda nowadays. But too many CPOs tell us of frustration at digitization projects that take too long, cost too much, and produce results that are too slow and meager.”

They continue “In our experience, these three problems share the same root cause: starting too small, usually by looking for the right off-the-shelf solutions for single pain points. The truth is that we have found only one way to realize the full potential of digitized procurement: through a user-oriented, end-to-end transformation of the entire source-to-pay (S2P) process, so that the users involved in procurement can operate in a fully digital environment. That goal translates into a single focus for procurement digitization: the user experience.”

What does that mean in reality? What difference would it make in the efforts to realize digitalization and automation strategies?

On March 28th we will find out! Apart from a keynote Lisa, Fabio and Riccardo also invite you to dig deeper into and discuss Your challenges and opportunities – and to draw from your peers – during round table discussions.

You are welcome to join us – registration is open and until December 31st there is an “Early Bird” offer available. You will not regret joining us.

 


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EBG | Network was founded in 2010. A cross functional, end-to-end business network focusing on improved sales and forecasting, increased spend under management and financial supply chain control. EBG bring people together online and in person who can help each other grow and develop.

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EBG is managed by Anna & Lars – partners in business and life. Contact us today with any type (business) related questions! Contact us using the LiveChat function below.

Anna & Lars are partners in business and life. Together we run EBG bringing together peers and experts in an informal yet to the point way.

Anna Bjarkerud

Anna Bjarkerud

anna@ebgnetwork.com +46 735819302

Anna & Lars are partners in business and life. Together we run EBG bringing together peers and experts in an informal yet to the point way.

Lars Bjarkerud

Lars Bjarkerud

lars@ebgnetwork.com +46733500343

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CPO Outlook 2023 | October 18th & 19th | Stockholm

Having enabled true networking among peers and experts since 2010 it was evident that EBG | Network fill a gap when we finally could meet again in person in 2022.

In 2023 we meet again in Stockholm on October 18th & 19th. Are you a practitioner and want to host round table discussions or a workshop? Based on the very simple question “What would You want to discuss and share experiences about with a peer group?” Contact EBG for a discussion

Do you offer services or solutions for the end to end procurement community and want to have informal yet very concrete discussions? Contact EBG for a discussion.

What EBG offer is unique. Based on a solid understanding about change management and how to create networking meetings.

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EBG | Webinar: Sustainability due diligence and governance for procurement in 2023

Procurement have been aware of the impact supply chain and external spend have on corporate sustainability agendas for a long time. A lot has happened on the legislation side as well as on corporate awareness. During this upcoming webinar EBG bring together brains and experiences across multiple aspects of corporate sustainability realization. Because even though […]

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EBG | Network will be listing competences and solutions in the area EBG work. Source 2 Pay is a broad area including everything from sourcing tools to cash management solutions. EBG do not help choose – but have a lot of material to share!

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