{"id":1669,"date":"2017-03-27T10:18:22","date_gmt":"2017-03-27T10:18:22","guid":{"rendered":"https:\/\/praxisinfosolutions.com\/?p=1669"},"modified":"2024-12-05T21:42:34","modified_gmt":"2024-12-05T16:12:34","slug":"10-ways-improve-procure-pay-process-using-sap-business-one","status":"publish","type":"post","link":"https:\/\/praxisinfosolutions.com\/blog\/10-ways-improve-procure-pay-process-using-sap-business-one\/","title":{"rendered":"10 Ways Improve Procure Pay Process Using Sap Business One"},"content":{"rendered":"<p><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-1 banner-heading-px hundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:0px;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-0 fusion_builder_column_1_1 1_1 fusion-one-full fusion-column-first fusion-column-last\" style=\"margin-top:-50px;margin-bottom:0px;\"><div class=\"fusion-column-wrapper fusion-flex-column-wrapper-legacy\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;background-color:#2f68d9;padding: 0px 0px 0px 0px;\"><div class=\"fusion-text fusion-text-1\"><h2 style=\"text-align: center; font-size: 30px; line-height: 40px; padding-top: 25px; font-family: 'Open Sans', sans-serif;\"><span style=\"color: #ffffff;\"><strong style=\"font-weight: bold;\">10 ways to improve your Procurement Management (Purchase) process using SAP Business One<\/strong><\/span><\/h2>\n<\/div><div class=\"fusion-clearfix\"><\/div><\/div><\/div><\/div><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-2 nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;padding-top:20px;padding-right:0px;padding-bottom:0px;padding-left:0px;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-1 fusion_builder_column_3_5 3_5 fusion-three-fifth fusion-column-first\" style=\"width:60%;width:calc(60% - ( ( 4% ) * 0.6 ) );margin-right: 4%;margin-top:0px;margin-bottom:0px;\"><div class=\"fusion-column-wrapper fusion-flex-column-wrapper-legacy\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><div class=\"fusion-text fusion-text-2\" style=\"font-family:&quot;Poppins&quot;;font-weight:400;\"><p style=\"text-align: left; font-size: 16px;\">SAP Business One is a completely integrated ERP application developed by SAP, the world leader in ERP solution, for companies that belong to the Small and Medium sector (SME). It allows the company to get complete visibility into its operations, reduce manual work, improve processes, increase overall productivity, and reduce working capital and so on. In this blog, we will be focusing on specific benefits of SAP Business One in Procurement Management or Procure-To-Pay process and how the former helps a company to adopt best practices in this domain.<\/p>\n<\/div><div class=\"fusion-clearfix\"><\/div><\/div><\/div><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-2 fusion_builder_column_2_5 2_5 fusion-two-fifth fusion-column-last\" style=\"width:40%;width:calc(40% - ( ( 4% ) * 0.4 ) );margin-top:0px;margin-bottom:0px;\"><div class=\"fusion-column-wrapper fusion-flex-column-wrapper-legacy\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><div class=\"fusion-video fusion-youtube fusion-no-medium-visibility fusion-no-large-visibility fusion-aligncenter\" style=\"max-width:600px;max-height:360px; width:100%;margin-top:30px;margin-bottom:30px;\"><div class=\"video-shortcode\"><div class=\"fluid-width-video-wrapper\" style=\"padding-top:60%;\" ><iframe title=\"YouTube video player 1\" src=\"https:\/\/www.youtube.com\/embed\/9MS3TEAI7O0?wmode=transparent&autoplay=0\" width=\"600\" height=\"360\" allowfullscreen allow=\"autoplay; fullscreen\"><\/iframe><\/div><\/div><\/div><div class=\"fusion-video fusion-youtube fusion-no-small-visibility fusion-aligncenter\" style=\"max-width:600px;max-height:360px; width:100%;margin-bottom:30px;\"><div class=\"video-shortcode\"><div class=\"fluid-width-video-wrapper\" style=\"padding-top:60%;\" ><iframe title=\"YouTube video player 2\" src=\"https:\/\/www.youtube.com\/embed\/9MS3TEAI7O0?wmode=transparent&autoplay=0\" width=\"600\" height=\"360\" allowfullscreen allow=\"autoplay; fullscreen\"><\/iframe><\/div><\/div><\/div><div class=\"fusion-clearfix\"><\/div><\/div><\/div><\/div><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-3 nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:0px;margin-top: -15px;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-3 fusion_builder_column_1_1 1_1 fusion-one-full fusion-column-first fusion-column-last\" style=\"margin-top:0px;margin-bottom:20px;\"><div class=\"fusion-column-wrapper fusion-flex-column-wrapper-legacy\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><div class=\"fusion-text fusion-text-3\" style=\"font-family:&quot;Poppins&quot;;font-weight:400;\"><p style=\"text-align: left; font-size: 16px;\">Procurement is a key process in organization, especially the ones that deal with materials whether for manufacturing or trading purposes. In fact a large percentage of the total cost is consumed by purchase cost. Hence, it\u2019s quite important that companies build and follow a robust process for the same. Any company that wants to get a complete control on its spend management and analyse its procurement data for gaining advantages in purchase negotiation and who want to ensure that processes are followed each and every time must consider SAP Business One.<\/p>\n<\/div>\n<div class=\"table-1\" style=\"margin-bottom:20px;\">\n<table width=\"100%\">\n<tbody>\n<tr bgcolor=\"#2f68d9\">\n<td style=\"text-align: left; padding-left: 5px;\">\n<h5 style=\"line-height: 27px;\"><span style=\"color: #ffffff;\">SL.No.<\/span><\/h5>\n<\/td>\n<td style=\"text-align: center; padding-left: 5px;\">\n<h5 style=\"line-height: 27px;\"><span style=\"color: #ffffff;\">Description<\/span><\/h5>\n<\/td>\n<td style=\"text-align: center; padding-left: 5px;\">\n<h5 style=\"line-height: 27px;\"><span style=\"color: #ffffff;\">SAP Business One<\/span><\/h5>\n<\/td>\n<\/tr>\n<tr>\n<td align=\"left\">1<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">Planned Procurement of Raw Materials<\/h5>\n<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">SAP Business One provides a functionality called Material Requirement Planning (MRP) which automates the process of finding out the potential material shortages with respect to a proposed fulfillment of a sales plan.<\/h5>\n<h5 style=\"line-height: 27px;\">System aggregates all demand elements and does backward calculation of materials and sub-assemblies required and makes recommendation on what item needs to be procured, in how much quantity and what should be the PO release date.<\/h5>\n<h5 style=\"line-height: 27px;\">This process can take care of all the items are a part of the bill of material of any FG or WIP.<\/h5>\n<\/td>\n<\/tr>\n<tr>\n<td align=\"left\">2<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">Procurement of consumables based on inventory levels<\/h5>\n<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">Certain items, normally found in C class, need to be planned based on consumption.<\/h5>\n<h5 style=\"line-height: 27px;\">SAP Business One provides a functionality by which users can store the minimum and maximum inventory quantity (location wise). Further, the system recommends procurement proposals based on the trigger of inventory falling below the minimum level.<\/h5>\n<\/td>\n<\/tr>\n<tr>\n<td align=\"left\">3<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">Reduction in maverick spends<\/h5>\n<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">Maverick spend means placing orders at prices higher than the prices negotiated in contract, usually done without consulting the procurement department.<\/h5>\n<h5 style=\"line-height: 27px;\">SAP Business One will put a complete end to such procurement and will instill a much disciplined process for procuring material and services. Only authorized users from purchase department can raise Purchase Orders in the system.<\/h5>\n<\/td>\n<\/tr>\n<tr>\n<td align=\"left\">4<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">Ad hoc procurement will be minimized or eliminated<\/h5>\n<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">These instances will be either eliminated or reduced drastically with SAP Business One. No material will be allowed to enter the premises without a PO in the system. Buyers who are at fault, will have explain the reason for such procurement to higher ups before being able to get their ad-hoc PO (at higher rate) approved.<\/h5>\n<\/td>\n<\/tr>\n<tr>\n<td align=\"left\">5<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">PO approvals<\/h5>\n<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">It is important to have an established authority matrix in any purchasing organization.<\/h5>\n<h5 style=\"line-height: 27px;\">SAP Business One allows you to set up value based rules that help the system determine automatically, as to whose approval is required for a particular PO in the system. Needless to say, procurement against a PO is only possible if it authorized\/approved by the concerned authority.<\/h5>\n<h5 style=\"line-height: 27px;\">Since this process cannot be circumvented, management can be assured of the fact that no untoward practices can prevail in the company.<\/h5>\n<\/td>\n<\/tr>\n<tr>\n<td align=\"left\">6<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">System Control on buying prices<\/h5>\n<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">When manual systems are used it is possible that rates in the purchase order may, either inadvertently or on purpose, be higher than what has been agreed on contract or price list.<\/h5>\n<h5 style=\"line-height: 27px;\">With SAP Business One, there are two ways by which such situations can be eliminated.<\/h5>\n<h5 style=\"line-height: 27px;\">Option one is to use a price list functionality. Using this, the system will automatically populate the price as maintained in the price list and user will be allowed only to reduce the price, if at all changes are allowed.<\/h5>\n<h5 style=\"line-height: 27px;\">Second option is to use the functionality called Blanket PO where a contract is created in the system for a combination of item and vendor and all further POs for the same combination will necessarily pick the prices from this contract and user will be allowed only to reduce the price, if at all changes are allowed.<\/h5>\n<\/td>\n<\/tr>\n<tr>\n<td align=\"left\">7<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">Accurate accounting of material sent back to vendor\/h5&gt;<\/h5>\n<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">Using the purchase return functionality, users can ensure that the inventory quantity, its value and vendors credit amount are adjusted appropriately whenever material is sent back to vendor.<\/h5>\n<\/td>\n<\/tr>\n<tr>\n<td align=\"left\">8<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">Tracking of performance of vendors<\/h5>\n<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">A report can be easily developed that will track the performance of the vendor in terms of delivery (actual v\/s planned delivery date) and percentage rejection and a score can be arrived at. This score\/rating can be updated in the vendor master and can be used for strategic decisions.<\/h5>\n<\/td>\n<\/tr>\n<tr>\n<td align=\"left\">9<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">Eliminate the possibility of business transactions carried out by your team with mala fide intention<\/h5>\n<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">A company that works with manual processes is exposed to the risk of fraudulent transactions carried out by staff.<\/h5>\n<h5 style=\"line-height: 27px;\">With SAP Business One, you can implement segregation of duties (SOD) quite comprehensively to ensure that no single system user can carry out transactions that can be potentially harming to the company financially. For example, a staff member should not be allowed to raise the PO and also make payments. With well-structured authorization profiles such possibilities can be eliminated.<\/h5>\n<h5 style=\"line-height: 27px;\">In addition to this you can implement other business rules that may prevent undesired transactions. For example, disallowing good receipt quantity to be in excess of the tolerance limit defined.<\/h5>\n<h5 style=\"line-height: 27px;\">Such capabilities makes your company free of such exposures and management can freely focus on business growth and other strategic initiatives without being concerned about mal practices.<\/h5>\n<\/td>\n<\/tr>\n<tr>\n<td align=\"left\">10<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">Improved communication with vendors<\/h5>\n<\/td>\n<td align=\"left\">\n<h5 style=\"line-height: 27px;\">You can email the PO to your vendor from within the SAP system, thus making it more productive process. You can also send SMS alerts to your vendors for pre-defined triggers say, release of payment, rejection of material, debit note etc.<\/h5>\n<h5 style=\"line-height: 27px;\">This will bring more transparency in the process and help build a trust based long term partnership with your vendors.<\/h5>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<div class=\"fusion-text fusion-text-4\" style=\"font-family:&quot;Poppins&quot;;font-weight:400;\"><p style=\"text-align: left; font-size: 16px;\">Praxis has partnered with many companies from different industry to enable them to migrate to a much effective, efficient and transparent procure to pay process by implementing SAP Business One. To learn about the same, please contact us at <a style=\"color: blue;\" href=\"mailto:sales@praxisinfosolutions.com\"><strong>sales@praxisinfosolutions.com<\/strong><\/a><\/p>\n<\/div><div class=\"fusion-clearfix\"><\/div><\/div><\/div><\/div><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-4 fusion-flex-container has-pattern-background has-mask-background nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: #e5ff2e;background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-4 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><div class=\"fusion-text fusion-text-5\" style=\"font-family:&quot;Poppins&quot;;font-weight:400;\"><h2 class=\"poppins-family\" style=\"text-align: center; margin-bottom: 5px; font-weight: bold;\">SAP Business One..<\/h2>\n<p class=\"poppins-family\" style=\"text-align: center; font-size: 16px;\">Perfect fit for your <strong>Business growth <span class=\"blue-text\" style=\"color: #2f68d9;\">Call us on<\/span> <span class=\"blue-text\" style=\"color: #2f68d9;\"><a style=\"color: #2f68d9;\" href=\"tel:+91-8805025521\">+91-88050 25521\/<\/a><a style=\"color: #2f68d9;\" href=\"tel:+91-8805025518\">18<\/a>\/<a style=\"color: #2f68d9;\" href=\"tel:+91-8805025519\">19<\/a><\/span><\/strong><\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body 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