From Chaos to Control: Revolutionizing Approval Policies in S2P
In Source to Pay (S2P) processing, approvals are considered painful and inefficient but a necessity. Approval policies are often out of control and are put in place as a “just do something” response to a significant negative event in S2P process.
In an ERP environment such as SAP solutions, most documents requiring approvals have varying degrees of automation. S2P core approvals include but are not limited to the authorization for an individual to order goods and receipts, request for quotations, vendor selection, vendor master record modifications, purchase requisition and purchase order submission, invoice payment for non-POs and PO based invoice exception resolution.
One prevalent issue with approvals is the timely response from approvers once notified. Given the importance of approvals, delay approvals bear discussing in more detail.
Why don’t approvers approve promptly? It is common that people involved in requesting goods or services don’t put the same priority on approvals as they do on the request they submit. They feel if they requested then why is their approval required? They prioritize fulfilling new requests and leave approvals for prior requests for later. Even when they approve, they quickly review and don’t really consider all the data fields that can cause immediate problems in the process flow. Even though automation validates many of the data fields and business rules check for exceptions, there are many fields that still require review. For example, cost center or GL code can be valid but wrong, especially when someone submits on your behalf.
Other common delays in approval include the approver works in Microsoft Teams but the approval must be done in the ERP. The approver may not have access to all the critical information. The approver may be a substitute and not know if goods or services match up with expectations. The approvers may not be aware of current policies or external regulations.
Often approvers at the executive level never reject the approval request. When you ask these approvers why they are in the approval matrix, the response is often they want to be aware of what is ordered, from who, and how much will be applied against their budgets. These executives should have the information they require but must be removed from the approval matrix so the process is truly optimized for timely approvals. What they need is a report!
Some approvals require simultaneous multiple approvals and when one path approves and one of the other paths reject, the full process becomes complex. Often a revision to the approval matrix can eliminate the need for simultaneous complexity.
During the strategic approval process design, it is critical that a complete audit trail is documented and digitally accessible.
SmartDocs provides Source to Pay automation solutions and the strategy guidance to ensure your approval process is optimized to drive timely and accurate approvals from sourcing to invoice payment!