The First Step In A Simple Transition To E-Payables

In the past, “solutions” that automate the accounts payable and procurement processes have been difficult to use or haven’t worked, sitting on the shelf while companies are left searching for something better. Coupa, cloud-based spend management software company, and NVoicePay are trying to solve the challenges of the path to procurement with payment – both important problems in the B2B payments space. In a podcast interview, NVoicePay CEO Karla Friede and Coupa General Manager Ashish Deshpande told PYMNTS CEO Karen Webster why the journey to mesh payment and invoicing in a digital environment is one well worth taking and why the first step isn’t really that hard.

KW: Let’s talk about this whole movement from paper-based to electronic accounts payable. I’d like to begin with an analogy – they say the journey of a thousand miles begins with a single step. That sort of seems to characterize that move from paper-based to e-payables. So what is that first step, and how hard is it to take?

KF: I think this first step is to look for a solution that really solves the problem. Solving the problem means sending all payment types through a single, very simple workflow that increases payables efficiency and takes on the support burden so it’s not left on to staff. The first step forward then is to take a step back and look at the market and solution. I think you will find traditional solutions don’t solve the problem very well. Specifically, the bank-based solutions don’t take on the service requirements that are necessary for a successful move to 100 percent electronic payments. When you find a solution that takes on those service requirements, the step to adopt the solution should be a very simple 30-60 day process.

The status quo doesn’t have to be turning to a bank-based solution that only solves a part of your problem.

AD: I completely agree. To add to that, because we look at the fulfillment and electronic payables space that Coupa plays in, the first step is really not hard to take. The problem is obvious. There have been solutions before to automate the process, but the difference is that these solutions are not simply being used. Forrester said that 57 percent of ERP solutions are just kept on the shelf. These solutions are not useable, and if they’re not useable, that’s why we see a continuation of this problem.

KW: So, Karla and Ashish, you’ve characterized the problem and why more businesses don’t take that first step. How do you persuade them that what you do is different?

KF: I think it’s easy once they see and understand the solution. For us, when someone sees the demo of our software, they get excited because they understand how much easier their lives will be and how simple it is to manage workflow. The work that we do to offer real-time reconciliation, to take calls from suppliers – all of that is not on their shoulders anymore. It’s really the beauty of the demo that brings it to life. And when you look at the solution and understand that you can truly go to 100 percent electronic payments, it makes the ROI very real.

AD: Yes, and in our e-procurement and e-payables space, the demo resonates because it is what customers see in everyday life. When people go home, often times they are shopping on Amazon. So for us, customers don’t really need to be trained to use that Amazon-like interface. So if you are able to show that to users, that you will use the same paradigm in your work that they’re doing in everyday life, that’s easy and shows the value. The solution will no longer sit on the shelf. And the difference really is that the lifestyles have really changed, people are more mobile, so in our space, we see 70 percent of the approvals are by mobile phone. So they don’t even log into Coupa to approve the transactions. That’s the technology that you need to offer to your users to make the system more useable. It is not software as a technology but software as a service.

KW: So what kinds of companies are really getting excited about what you offer? Are there particular industry segments or characteristics of companies?

KF: I think it’s really a cross-section, and quite amazing. We have customers in construction, medical, manufacturing, retail, and restaurants. They’re all customers who have been driven by the desire to make the process easier, and those customers have been the first movers but I think they’re just the tip of the iceberg. I think that many more will follow, and the market is in the early stages of its evolution. The more modern, cloud-based solutions that offer the simplicity, flexibility, and efficiency that the market needs will get the market moving in that direction in 2015 and 2016.

AD: We have customers across the board – they’re amazed at how much green field opportunity there is. Businesses are expanding, lifestyles have changed, and they still need a solution. For us, the early movers have been customers with thousands of locations.

KW: How does NVoicePay and Coupa complement each other?

KF: I think we’re alike because we’re both cloud-based and have simple, efficient systems that drive a dramatic bottom-line result for customers. And I think we have a similar approach – an absolute focus on the return for the customer. We complement each other in terms of the P2P. Today, there really is just P-to-invoice. Coupa has done an amazing job of taking procurement and making it simple for large enterprises and smaller enterprises alike. We are doing something similar on the backend payment part of that process. Together, we create a natural P2P flow.

AD: I think that’s absolutely right in that what Coupa has done to PRPs and existing client service systems, NVoicePay is doing for banks and ERPs. That’s how we are complimenting each other – we are doing in the payables space what NVoicePay is doing in the payments space. It’s really a match made in heaven.

KW: So if the journey of a thousand miles is 100 percent electronic payments and invoicing, how long does that take?

KF: To some extent, it depends on the size of the customer in terms of how many vendors they have, and how many vendors they pay, and how many payment locations they have. The process is a 30-day process for smaller companies and at most a 60-90 day process for larger enterprises. So it’s not 1000 steps – it’s much simpler than that. I think the first step is the biggest, and that’s looking around to see what solutions are available and making the decision to move.

AD: Customers will even start to see the benefits right in the 30 day time frame, even the large customers. They can get fully integrated with the backend within 90 days, but they can start getting some savings back into their bottom line in 30 days.

To listen to the full podcast, click here.