Blockchain is a distributed and decentralized public ledger that records transactions in a way that forging, breaching, and stealing of information becomes difficult. It promotes information and transaction security as the blocks are connected through the cryptographic hash functions.
Blockchain Solution for Procure to Pay
Procure-to-pay, also referred to as P2P, is the ordered sequence of phases involved in the procurement and financial procedures for goods and services. The traditional method of procure-to-pay has certain flaws and a blockchain procurement solution is an ideal choice to streamline the associated processes.
The blockchain solution for procure to pay can meet the dynamic customer requirements. It guarantees the security of data and networks. A quick purchase order management process is achieved using a blockchain procurement solution, which also brings in the required accuracy, security, and clinical efficiency.
Issues with the Traditional P2P Process
Procure-to-pay is a multi-step process. The initial step usually is the procurement process in which the purchase order is created and confirmed. The goods receiving process, order confirmation, and payment & invoicing processes are the ones that are executed thereafter in the same sequence. The procurement and supply chain activities are essential for almost all business organizations.
Low response time
The business firms in the present times execute hundreds of processes simultaneously. Additionally, there are changes that emerge in the processes, and these need to be managed separately. The current P2P process is impacted by the inability to manage the changes. The requirements and parameters are dynamic, which makes the P2P procedure extremely complex and it affects the quality of the outcomes. The routing and processing involved are manually done. This increases the response time for the P2P cycle.
Higher chances of error
Manual data handling and management, data entry, and other processes lead to greater risks. There are higher chances of errors with increased costs per invoice. Increased costs negatively influence the profit and loss sheet of the business. Continued errors in invoices will turn out into continual leakage of the money.
Blockchain-based procurement solutions are disruptive innovations. The Blockchain solution for procure to pay can overcome the issues businesses face in the traditional P2P process.
Introducing Blockchain for Supply Chain and Procurement
Blockchain is a technology that is currently transforming and revolutionizing the supply chain handling and management. Supply chain solutions based on blockchain have introduced transparency and visibility in the system.
Blockchain eliminates middlemen and resources involved in the procurement process, thereby eliminating problems like complex negotiations, handling of information at every stage, local verifications, etc. that slow down the entire cycle.
Benefits of a Blockchain solution for Procure to Pay
The blockchain-based supply chain and procurement solutions can offer benefits to suppliers, customers, and all the business entities. These can offer a number of advantages, including the following:
Accelerating the purchase order process
There can be hundreds of vendors in a company’s supplier network. The shortlisting and selection of the vendor can be a troublesome activity. Also, the incorrect selection of a vendor can result in ineffective supply chain management. Blockchain speeds up the process of purchase order management and it can quickly determine the most suitable and cost-effective vendor as per the organization’s requirements. The accelerated pace automatically results in more business and increased profits for the business firms.
Safeguarding the process
The supply chain networks are impacted by information security threats and attacks. Cutting-edge blockchain-based procurement and supply chain solutions can safeguard the entire procure-to-pay process. The front-end system accessible to the customers and the suppliers can be used to authorize and authenticate vendors. The advanced authorization is applicable to avoid any of the issues of information breaches or other security attacks.
End to manipulation and frauds
End-to-end visibility and transparency are achieved through the Blockchain technology that also eliminates the risk of manipulation and frauds from the procure-to-pay processes. With increased visibility, accuracy, and security, businesses can improve supplier and customer relations. Both of these networks need to be strong for a business firm to gain a competitive edge in the market.
Preservance of customer trust
The regular occurrences of security issues and attacks lead to deterioration of customer trust and engagement levels. The competitors often benefit from such situations. These occurrences and events can be easily avoided with a blockchain solution for procure to pay.
Elimination of associated complexities
Blockchain helps synchronize the entire inventory and data sets, leading to the elimination of associated complexities. There is complete traceability offered by Blockchain networks — from source to destination and back. The Blockchain-based procurement solutions provide the ability to calculate real-time discounts applicable on the total purchase. The amalgamation of digital and physical information is done at one platform to deal with security threats.
Blockchain-based supply chain solutions assist business organizations to achieve such an edge. Blockchain procurement solution leads to an enhanced level of trust among supplier groups and third-parties.
An emerging technology, blockchain has disrupted the entire globe positively. We need to maintain pace with innovative technologies and their applications for enhanced customer experience. The Blockchain technology can be efficiently applied in processes like procurement and supply chain.
The issues with the traditional procure-to-pay process in terms of reduced accuracy, poor visibility, security issues, compliance issues, manual errors, etc. can be resolved with a blockchain solution for procure to pay. There are benefits that all stakeholders can gain in the process. Business organizations and customers get to associate with trusted and cost-effective suppliers. The suppliers, as well as procurers, also get end-to-end visibility and transparency.
At Antier Solutions, we conduct in-depth research and deploy an innovative approach to roll out a blockchain-based supply chain solution successfully. As a forward-thinking organization, we adopt the latest technologies that can offer immense benefits to businesses. We are working on providing blockchain solutions to the clients for improved security, accuracy, and reliability.
If you are planning to build a blockchain solution for procure to pay, connect with our subject matter experts to share your business needs.