In 2024, an Economist Impact report, sponsored by SAP, surveyed more than 2,300 C-suite executives to understand procurement’s evolving role. The findings reveal that legal and regulatory procurement compliance is one of the top challenges procurement leaders face, with 70% of organizations identifying it as a critical external risk.
This research shows just how complex procurement compliance has become. Procurement teams must navigate evolving regulations, mitigate supplier risks, and ensure consistent policy adherence, all while maintaining operational efficiency.
Without the right technology to provide in-depth visibility, compliance gaps can go unnoticed, leading to costly penalties and inefficiencies.
Three methods to increase procurement compliance efficiency
1. Reduce maverick buying to reduce costs and increase procurement compliance efficiency
Maverick buying (purchases made outside established procurement processes) creates procurement compliance vulnerabilities, inflates costs, and increases financial and legal risks. Employees may bypass procurement policies due to slow approvals, lack of clear guidelines, or difficulty in finding preferred suppliers.
To address this, organizations can implement guided buying tools that make it easier for employees to find and purchase from approved suppliers. Automating purchase approvals speeds up processes, reducing the temptation to bypass policies.
SAP Signavio solutions can help gain in-depth process performance insights that identify where and why maverick spending happens, offering targeted recommendations to bring purchases back in line with procurement compliance policies.
2. Improve three-way match rates for greater accuracy and fraud prevention
Matching purchase orders, invoices, and goods receipts is essential for preventing discrepancies, overpayments, and compliance failures. However, when these processes rely on manual intervention, errors can slip through, slowing down procurement cycles and increasing risk.
Automating invoice matching can flag discrepancies early and reduce the need for manual corrections. Standardizing procurement workflows ensures consistency across supplier transactions, while AI-driven analytics help detect anomalies before they escalate into procurement compliance violations.
With SAP Signavio solutions, organizations can track three-way match rate performance, uncover the root causes of inefficiencies, and pinpoint areas where automation can improve compliance efficiency.
3. Minimize process variants to enhance procurement efficiency and improve overall performance
Minimizing process variants helps ensure that all procured goods and services meet the same standards, reducing the risk of defects and improving overall product quality. Also, streamlined processes reduce complexity, making it easier to manage procurement activities, leading to faster processing times and fewer errors.
With fewer process variants, managing supplier relationships becomes simpler, allowing for better communication, stronger partnerships, and more effective negotiation. Plus, companies can better ensure compliance with regulations and internal policies, reducing the risk of noncompliance and associated penalties.
SAP Signavio solutions provide cross-systems visibility into processes, allowing organizations to monitor supplier performance, flag potential risks, and proactively address procurement compliance efficiency gaps.
How to accelerate the journey to procurement process excellence
Leading organizations are already strengthening their procurement compliance with SAP Signavio solutions. Ready to take control? Download The Procurement Leader’s Guide to Process Excellence to further explore the methods to increase procurement compliance efficiency.
Plus, leverage deeper insights on two other key areas for accelerating the journey to procurement excellence: boosting procurement efficiency and productivity, and increasing financial efficiency.