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Home » Blog » Source-to-Pay » Intake to Pay vs. Procure to Pay: Key Differences and Selecting the Right Approach

Intake to Pay vs. Procure to Pay: Key Differences and Selecting the Right Approach

Intake to Procure
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The expression “intake to pay” has become increasingly common in the procurement world in recent years. However, its meaning and how it differs from the traditional procure-to-pay cycle remain unclear for many.

The term “intake” describes inbound demand management, which includes the procedures for gathering, verifying, and processing requests from internal stakeholders into actual procure-to-pay transactions. The term “intake-to-pay” highlights the significance of the early intake stage in influencing the effectiveness and cost-savings of downstream procurement.

However, confusion arises when intake-to-pay and procure-to-pay are used synonymously. This blog seeks to highlight the strategic importance of strong intake management in particular and to clearly differentiate these two important procurement procedures.

Procurement leaders can optimize their intake processes to strengthen alignment between internal needs and procurement delivery for maximized value by fully-understanding the difference.

What is Intake to Pay?

Intake-to-pay refers to the focuses primarily on the early stages of the procurement process, specifically the inbound demand management stage, rather than covering the full source-to-pay cycle. Key steps in an intake-to-pay flow are:

  • Need Intake — Stakeholders across business units submit procurement requests via channels like web forms, virtual shopping catalogs, punchouts to ERPs, etc.
  • Request Enrichment — Submitted requests are enriched with necessary details on specifications, business justification, expected usage, etc.
  • Request Validation — Requests get routed to approvers as per policy thresholds for validation. Budget availability gets verified.
  • Procurement Execution — Validated requests get converted to POs and sourced from contracted suppliers in a compliant manner. Downstream procure-to-pay processes follow.
  • Lifecycle Tracking — Full visibility into request status from initiation to fulfillment or closure. Analytics provide insights into lead times, cycle times, etc.

In intake-to-procure, the execution of compliant sourcing is prioritized together with the inbound demand management stage. Benefits include optimizing contract coverage, controlling spending, and matching to real needs. The absence of guardrails for requests and their fungibility across budgets present difficulties, though.

What is Procure-to-Pay?

Procure-to-pay (P2P) refers to the procurement process that covers activities involved from the initiation of a purchase requirement to making payment to the supplier. Key steps include:

  • Purchase Requisition — Internal users create and submit purchase requisitions for needed goods/services.
  • Purchase Order — Requisitions are converted into approved purchase orders after budget checks.
  • Order Execution — Suppliers deliver the requested goods or services as per the PO terms.
  • Invoice Processing — Invoices received from the supplier are validated against POs and receipts.
  • Invoice Approval — Validated invoices are routed for payment approval based on thresholds.
  • Payment — Final approved invoices are paid to suppliers through the organization’s payment system.

Explore: Zycus’ Procure to Pay Software

The goal of the procure-to-pay cycle is to connect and automate the procurement processes to improve compliance, efficiency, and working capital. However, there are obstacles, like malfunctioning systems and the absence of upstream intake controls.

Also read: Procure To Pay Automation – Best Practices and Benefits

In a nutshell, procure-to-pay focuses on the transactional aspects of requests that are integrated into the procurement procedure. The successful execution of compliant, value-focused procurement is mostly contingent upon intake management.

Intake to Pay and Procure to Pay – A Side-by-Side Comparison

While intake-to-pay and procure-to-pay deal with interlinked aspects of the buying workflow, there are some key differences between the two approaches:

Parameter: Intake-to-Pay Procure-to-Pay

ScopeFocuses primarily on the early stages of procurement, managing and shaping inbound demandFocuses on the transactional procurement process once requests are introduced
EmphasisGives more importance to shaping, managing, and tracking inbound demandOriented around automating and connecting downstream procurement execution
Request ManagementApplies strong request intake controls including enrichment, approvals, guided buying, etc.Often involves stages of request management and validation, though the focus is more on the transactional and execution aspects of procurement
AnalyticsProvides visibility into request trends, adoption metrics, cycle times, etc.Limited insights into upstream demand patterns
AutomationHeavier focus on intake automation including self-service, no-touch approvals etc.Automates downstream procurement workflows like PO creation, invoice processing etc.
Risk ManagementControls risks like budget overruns and maverick buying by embedding guardrails earlyInvolves both proactive and reactive risk management strategies, including compliance checks and validation processes
Stakeholder AlignmentTight alignment between internal needs and procurement deliveryMisalignments more likely due to inadequate intake control

When is Intake to Pay Preferable Over Procure-to-Pay?

Organizations that heavily decentralize their procurement processes and lack intake guardrails can benefit from intake-to-pay by improving demand shaping and compliance control.

This is generally true, but it’s important to add that Intake to procure is also beneficial for organizations aiming to strengthen their demand planning and control, not just for those with decentralized processes. It’s about improving the quality and compliance of procurement requests before they enter the Procure-to-Pay cycle.

It is the best solution for customers looking to purchase self-sufficiency to increase adoption. Planning categories and maximizing contract coverage are made easier with an intake focus.

Transitioning to modern execution while using the historical procure-to-pay nomenclature helps reduce change management for organizations with established centralized intake programs.

Adopting any new system or process, whether it’s labeled as Intake to Pay or Procure-to-Pay, can still involve significant change management efforts.

Also, procure-to-pay can be a better option for capital expenditures (CAPEX) with limited budget fungibility. The best features of procure-to-pay and intake management are combined in an integrated solution.

Bridging the Gap with Intake Management

Many organizations continue relying on decentralized, manual approaches for handling incoming procurement requests. However, spreadsheets, emails, and paper-based forms pose multiple challenges including:

  • Lack of visibility into who is requesting what at an enterprise level
  • Difficulty ensuring requests meet budget and policy compliance
  • Increased maverick spend due to the inability to guide requestors
  • Delays and errors from manual request routing and data entry
  • Reactive procurement without insights into upcoming demand

This results in bloated processes, compliance issues, and an inability to leverage spend. Intake management aims to transform request management by providing:

  • Consolidated intake channels like self-service portals
  • Guided buying catalogs for compliant requesting
  • Configurable workflows for streamlined routing
  • Analytics for real-time visibility and continuous optimization
  • Integration with downstream procurement systems

Also, read our blog on: Unlocking Success: Intake Management Best Practices And Key Strategies

Transforming Intake with Zycus iRequest

Zycus offers a dedicated intake management module, iRequest, that helps organizations optimize and elevate their request process. It provides:

  • Consolidated Intake Channels — Offer intake via a self-service portal, email, ERP forms, or other channels. Guide Buying ensures compliant ordering.
  • Configurable Workflows — Set up approval chains, auto-routing rules, thresholds, and requirements tailored to your needs.
  • Tracking and Analytics — Comprehensive audit trails provide visibility into request status. Analytics identify bottlenecks and improvement areas.
  • Easy Procurement System Integration — Inbuilt integration with Zycus modules like guided buying, eProcurement, contracts, and more streamlines source-to-pay.

With iRequest, enterprises can reduce maverick spending, enable data-driven procurement, boost user satisfaction, and alleviate manual efforts. Strategic intake and execution are linked, enabling procurement to reach its maximum potential and yield a substantial ROI.

Watch Zycus iRequest Overview Video

To learn how Zycus can help you transform your intake process with iRequest, request a demo today. Our experts can map your needs to the procure to pay software that maximize value across the procurement lifecycle.

Related Reads:

  1. Steps to Transform Your Procurement Intake Process
  2. Unlocking Success: Intake Management Best Practices And Key Strategies
  3. 4 Tools to Elevate Procurement Performance and Capture the CFO’s Attention
  4. 6 Common Mistakes You Shouldn’t Make In Your Spend Management Strategy
  5. Steps to Transform Your Procurement Intake Process
  6. Whitepaper: 10 Key Take Away: Transforming the Source-to-Pay Process
  7. Whitepaper: Essential Source-to-Pay KPIs, Implementation Mindfulness & Benchmarking
  8. Whitepaper: Source-To-Pay Transformation With AI And RPA – A study by ISM and Zycus
  9. Linking Source-to-Contract & Procure-to-Pay
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Pranav R is a Content Marketer with expertise and experience in creating & curating content for audiences of all ages. Graduating with an MBA from IITM in 2021, he explored his PM inclinations for a year, before joining Zycus. He’s been writing about procurement & paraphernalia for 1.5+ years and is passionate about bringing new perspectives, pointers & puns to what he writes. Outside work, he’s an Arsenal fan, and is a quiz & word games enthusiast.
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