PROCUREMENT 101

Source-to-Pay RFP: How to Tailor Your Software Search to Your Organization's Requirements

Introduction

When initiating a Source-to-Pay (S2P) transformation, one of the top foundational decisions an organization must make is selecting the right technology partner. Traditionally, building a comprehensive Request for Proposal (RFP) has been one of the first steps used to guide this selection. However, many organizations make the mistake of issuing generic RFPs that emphasize exhaustive feature lists rather than aligning with their unique business needs. This approach often leads to inefficiencies, misalignment, and difficulty in distinguishing between vendors.  

In this blog, you’ll learn how to facilitate a competitive process that will serve your organization’s unique requirements, exposing the most critical differences and similarities between the options in front of you. 

1

DEFINE SUCCESS: STATE YOUR DESIRED IMPACT & OUTCOMES

Internal stakeholders and external solution partners should have an understanding of the exact outcomes you are looking to accomplish from your transformation. Before you start listing software capabilities, first establish clear goals. Are you aiming for greater spend visibility, compliance automation, or enhanced supplier collaboration? What are your current metrics, and what are you trying to achieve?  By when? Identifying key business drivers will help vendors propose solutions that align with your strategic priorities. 

The more information you provide to potential partners, the better they can tailor their solution to your organization’s needs. Clearly articulate key details, including current systems and usage, input from internal stakeholders, maturity assessment results, and your long-term vision. Doing so early can help ensure that proposals are well-informed and aligned with your procurement transformation strategy. 

2

FOCUS ON KEY DIFFERENTIATIORS

A preliminary market scan should weed out unfit solutions based on capabilities and proven ability to execute. Beyond this step, concentrate on the attributes that set solutions apart instead of requesting every possible feature. Utilize your time more effectively by identifying the most critical requirements, including the following: 

User Adoption and Experience: Prioritize intuitive interfaces and workflow automation to drive efficiency and engagement.

Define Process Narratives: Create an apples-to-apples comparison of critical and differentiating solutions, typically influenced by clearly defined process narratives.

Relevant Use Cases: Narrow the discussions and use cases on prioritized areas that will make a direct difference to your organization.  

Industry-specific Functionality: Ensure the platform can handle vertical-specific complexities. For example, regulatory compliance for financial services or direct spend for manufacturing. 

Integration Capabilities: Assess how well the solution integrates with your existing ERP, finance, and procurement systems.  

AI and Predictive Insights: Evaluate how the platform leverages AI to enhance procurement processes, such as automating risk assessment, managing supplier performance, and contract discovery. 

Complementary Addition to Overall Business Sytems Environment: Structure questions to align with your organization's target-state technology landscape, ensuring the solution supports scalability, integration, and industry best practices. 

EXPERT TIP:

A bloated procurement RFP with hundreds of questions on basic functionality can quickly become counterproductive.

3

EVALUATE TOTAL COST OF OWNERSHIP (TCO)

Beyond annual software subscription costs, consider all other cost factors, including implementation, maintenance, and ongoing internal resourcing. Request a breakdown of pricing models, including: 

  • Applicable software licensing models 
  • Implementation and support fees 
  • Additional costs for integrations, customizations, and upgrades 

4

CONSIDER THE ROADMAP

Throughout your search, keep one important question at the forefront of your mind: What solution and partner is best positioned to enable you through the next 10 to 15 years?  

A S2P platform is an investment in your organization’s future operations and spend management capabilities. Your ability to navigate the unexpected challenges of the next 10 years is connected to enabling a strong technology infrastructure. The wrong solution can create more issues than it solves — rapidly escalating costs, intensive administrative requirements, and a roadmap that doesn’t align to future needs. Future-proof your selection by tackling the previous points while also keeping in consideration the evolving needs of a growing organization. 

Conclusion

An effective go-to-market process consists of more than just a list of requirements in a procurement RFP — it’s a strategic tool that helps you find the right Source-to-Pay solution for your organization. By defining clear objectives, focusing on key differentiators, avoiding unnecessary complexity, prioritizing total cost of ownership, and evaluating the roadmap, you can drive a more effective selection process.  

Need help defining your go-to-market process and RFP criteria? Contact the team at Optis to guide your selection process with industry expertise and practical insights. 

Author

Aaron Dunn, Partner

Connect with Aaron on LinkedIn

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