P2P Business Case: Golden Mountains or Bottomless Pit?

P2P & Verder started a series of five meetings on Purchase-to-Pay topics in 2021. In the first session, we focused on the analysis and baseline measurement of your P2P process. Here we discussed how to carry out a good analysis of your P2P process and how to determine the state of affairs with a baseline measurement.

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Potentially, there are three different outcomes that could result from the P2P analysis:

We're getting pretty close to the benchmark: this means we don't have to adjust much and keep what's good.
There are a few specific parts that can be improved: this means that we can start small improvement projects to get started with these components.
In various areas, the P2P process is not running optimally and there is great potential for improvement. To improve the situation, you will have to start a project and get started with a business case and project proposal.

If the P2P analysis and baseline measurement show that it is wise to take a larger approach to the improvement process, it is important to draw up a good business case and then a plan of action or project proposal. In this blog, we take you through the various aspects of a Business Case and how to start a P2P project. Here we will address the question of how to find out what a P2P project can bring to your organization based on the following topics:

Why start a P2P Business Case?
The P2P Business Case in the various project phases
What is at least in a P2P Business Case?
What does a P2P project deliver?
Calculating purchasing savings and efficiency
How much does a P2P project cost?
Creating different scenarios
6 tips for preparing a P2P Business Case
You've created a Business Case: What now?
Maintaining your Business Case

Why start a P2P Business Case?

The Business Case is the business justification for a project. The Business Case briefly states what the P2P project delivers and what the project costs. For example, questions that are answered in a Business Case include:

What does the P2P project contribute to the organization's strategy and goals?
What are the benefits of the P2P project?
What are the costs and what are the risks of the P2P Project?
Etc.

The Business Case is often the tool for senior management and stakeholders to decide whether or not to start the P2P project. So it is very important that your Business Case is as well put together as possible.

The P2P Business Case in the various project phases

The P2P Business Case plays a role in all the different phases of the project. For example, the business case is drawn up at the start of the P2P project, but it is also important to keep the Business Case up to date during the further development of the project:

The start of the P2P project

As shown in the image above, it is particularly important to properly identify the benefits and costs at the start of the P2P project. Based on this, you will receive approval to draw up the project plan.

During the implementation phase
During the implementation phase, it is important to keep the Business Case up to date based on progressive insight. This way, you maintain a realistic picture of the expected outcomes throughout the project.

Completion of the P2P project: the Going Concern phase
Even when the project comes to an end, you are not done yet. This is the time to measure whether the benefits have actually been realised. In addition, be aware of the 'Going Concern' phase. This is the phase that starts after the project has been completed. In this Going Concern phase, the measures you initiated during the project still affect the results: it is important that they are positive even after completion of the project.