Government Mandate for e-Procurement Expected to Bring Savings
As a part of the “Campaign to Cut Waste,” the president has required that the Internet Payment Platform (IPP) go live for all government agencies by the start of the fiscal year. This means that as of October 1, 2012, businesses will have to use e-procurement to send bills to the federal government. While these mandates are not new, having already been implemented in countries like Finland and Mexico, they present a great deal of incoming change for the United States. Although e-procurement grew 20% in 2011, the flood of invoices that will transition from paper to electronic format to meet the new government requirements is expected spike even more growth.
Internal estimates show that the efficiency benefits of the IPP will save the taxpayers approximately $450 million per year. The Department of Defense’s e-procurement system is already online and saving approximately $250 million per year in administrative costs.
In exchange for submitting invoices electronically, businesses will derive two key benefits. The first is that they can expect to receive payments more quickly. The second is that they can check on the status of their invoices in real time through the IPP’s web-based portal.
There is also a larger benefit to the government mandate for e-procurement. Once a company has implemented invoice management software to collect from the federal government, they’ll have an automated solution in place to electronically bill their private clients as well. Research shows that once companies experience electronic invoicing, they see its benefits and increase the rate at which they use it. The best part of increasing your company’s use of technology? Maximizing the benefit from it, which is quickly done with the built-in best practices that come with an invoice management solution.