The high cost of process inefficiencies
Take the purchase-to-pay process for example. You have procedures and standards in place to maintain accuracy and consistency. But what if it turned out that vendors were receiving purchase orders with the wrong pricing 20% of the time? That’s a big issue, and you wouldn’t have any idea of the scope and impact of it unless you knew to look for it.
In the above example, it could easily take 20 minutes to correct each purchase order, and in a large organization something like this could be happening tens of thousands of times. When you do the math, it adds up to years’ worth of man-hours to resolve this single recurring issue.
Regardless of an organization’s size, failures to find and eliminate inefficiencies can result in a 10-20% loss on margins. With multiple moving parts and players, business process oversights occur daily at most organizations. Worse, these issues often go undetected for some time, leading to slow throughput, cash discount losses, low efficiency, slow customer response time, and bottlenecks.