Digitization has been on the minds of organizations for decades, but the journey can look quite different from one organization to the next.
The middle-market has faced some particularly challenging hurdles, often ill-positioned to embrace many of the advanced technologies and enterprise resource planning (ERP) systems designed for larger enterprises, and rarely targeted by the innovative FinTechs that have their sights set on small businesses.
With the source-to-pay workflow a rapidly evolving field, the space has become a hotbed for digital transformation efforts. Yet with mid-market firms forced to cobble together a variety of disparate solutions, these businesses have struggled to automate the flow of this intricate process, let alone optimize it to promote the firm’s strategic visions.
PairSoft CEO Matt Cotter discussed with PYMNTS why mid-market firms continue to face friction when attempting to overhaul source-to-pay. At a time when so many organizations are focused on digital transformation, it’s also up to the B2B FinTech solutions that make it possible to reconsider their own approach to customer success, he said.
The expanded performance of complex ERP systems like SAP and Oracle may prove advantageous to the largest of enterprises. But the mid-market firm that finds such tools overly complex and expensive can find itself at a loss for which solutions to wield, especially when it comes to driving source-to-pay automation.
As Cotter noted, these businesses still need a relatively high degree of functionality. They’re seeking sourcing, punchout catalogues and requisitioning capabilities before any product or service is ever procured. Further down the process line, they need vendor and catalogue management, purchase order (PO) and invoice tools, and technologies that can support accounts payable (AP) automation through document management and data integration with solutions like optical character recognition (OCR).
What’s more, mid-market firms seek technologies that can seamlessly connect these workflows together, from initial sourcing all the way through to supplier payment.
As the result of a previous merger between PaperSave and Paramount WorkPlace — and having acquired Webiplex — PairSoft is bridging those gaps. While it’s a work-in-progress, Cotter shared his vision for the company and identified the biggest opportunities for the platform to ease source-to-pay pain points.
For instance, while the platform cannot today facilitate the actual B2B payment, the capability is certainly on its roadmap. The supplier payment flow isn’t just about providing more automation, either; it’s also about delivering strategic insights and empowering firms to maintain valuable B2B relationships.
“Everybody thinks procurement ends with a PO,” said Cotter. “Procurement doesn’t end until my suppliers are paid because I need to know whether I’m capturing volume discounts, and frankly I need to know whether we’re treating our suppliers well.”
A current lack of visibility into these insights, whether it be from B2B payments data or otherwise, has historically held the industry back from true transformation. When source-to-pay technology cannot only automate supplier payments, but help an organization predict whether to use a card to secure rebates and early payment discounts, or identify what an organization should be procuring, when, and at what locations, that’s when technology can offer effective support for transformation.
Rethinking Customer Success
Cotter highlighted several key industries with the greatest opportunity for this kind of transformation, including healthcare and nonprofits. Understanding the customer and its unique needs have become instrumental for B2B FinTechs and digital platforms to find traction in an increasingly crowded and complex market.
Yet as businesses reconsider what it means to digitally transform, Cotter agreed that these service providers must also take another look at their role in that process.
Historically, source-to-pay technology providers have defined success for their sales teams as “perpetual licenses and maintenance.”
“The entire motion was designed to maximize revenue during the sales process and minimize cost in the post-sales environment,” Cotter explained.
Software firms were fostering the rise of “customer service organizations that are designed to be profit centers,” he added, resulting in lengthy implementation times.
Today, there is a major change afoot in this industry and other providers of back-office business technology. B2B technology firms are reframing what customer success means and are beginning to prioritize cutting down friction for a business user.
Understanding a client’s unique needs, as well as the positive impact that client could have in their industry when armed with the most effective digital solutions, is encouraging source-to-pay and other arenas to invest in post-sale support, adoption tools and value creation.
This has a significant impact on the relationship between a business and its technology partners, Cotter said. As PairSoft works to introduce new functionality into its offering to support B2B payments, standardizing user experience through seamless integrations and introducing high-level capabilities like predictive analytics, the company will also be embracing the opportunity to value the success of its clients.
It reflects a widespread paradigm shift in the B2B technology space for the better, Cotter noted.
“It’s going from a position where the incentives were misaligned, to one where our job as the technology provider is to make our customers the hero in this digital transformation journey,” he said. “It’s a pretty fundamental change.”