Carlos Zegarra, leading member of Management Consulting in PwC Mexico said that based on several studies fulfilled by the company, globally and regionally, on CEOs concerns regarding the challenges coming with new technologies, have launched the process Source to Pay (S2P,) which supported on Robotic Process Automation (RPA,) identifies the purchase needs, adds value and decreases the time used in supply chain processes. Thereupon, costs align and even promote innovation in the industry adopting them.
“When we analyze what is related with costs reduction, most of them are made up of what we determine as ‘expenses with third parties,” which is everything a company buys from a supplier, basically personnel expenses,” said Carlos, “for example in the manufacturing sector can be generated from 50 % to 70 % of those expenses with third parties of its entire costs structure, but as we are able to work strategically this management, more benefits will be seen in a short term, and this need is permanent and much stronger in our country of being more efficient.”
Zegarra explained that the S2P concept implies an evolution of the traditional model of supply companies have so that these processes are more strategic and add more value to the business. As an example, he explained that the Acquisition areas have to be a business partner with all Operations and Commercial areas to have visibility in the business strategy.
Strategic sourcing generates more value, as it implies companies have to analyze continuously what is necessary to buy in the short, medium and long term and challenge in some way the requirements of the users. “We have seen cases in which different areas request the same from the market, but with determined differences, which not allow making possible to consolidate a request. For this, we have worked on commercial areas to remove complexity from requirements and standardize what is needed, and that enables the company having more negotiation power with suppliers and consolidate higher purchases,” said the leading partner.
He added that this strategic approach is the one Mexican companies suffer the most.
There is also the operative approach, which has to be highly automated, using technologies like RPA, which generate more purchase benefits, as Carlos explained, they can make 50 % more efficient the time these processes take.