3 Ways to Simplify the Source to Pay Cycle with Costpoint
Source to Pay is a key part of doing business in the government contracting space - many companies will spend up to 40% and even 50% of their costs procuring goods and services. In the procurement world, buyers are often dealing with multiple subcontractors, and direct and indirect material suppliers, and also using numerous methods of communication with internal stakeholders. However, that diversity can increase procurement cycle times, days payable outstanding (DPO), and the time needed to complete a CPSR audit, so maintaining as streamlined of a process as possible is crucial. How can Costpoint help you simplify the source to pay cycle in three key ways?
#1: Build a Healthy Pipeline
The first component is to start with a healthy pipeline. It’s crucial to identify opportunities early, improve win rates, and develop sound strategy and plans based on actionable data. Deltek’s GovWin IQ serves government contractors by providing the earliest awareness of new opportunities, planning intelligence, potential teaming partnerships, and the strategic insight that businesses need to get ahead of the competition and win more business. Combining accurate, timely, and actionable data with industry leading sales and proposal development tools, GovWin IQ gives sales, marketing, and executive teams everything they need to pursue, propose, and win more government business.
Next, establish relationships with the right vendors, subcontractors and suppliers. GovWin IQ integrates with Costpoint Contract Management to help reduce data entry and automate the entire management and administration of government contracts. With Costpoint, there is also the ability to export your potential teaming partners as well. Once the prospective vendor information is in Costpoint, the data can also be easily refreshed and synced from IQ if there are any changes - including vendors on the exclusion list. This particular capability is powerful; doing business with a debarred or suspended supplier is a material deficiency in a CPSR audit.
Finally, you can enter your post-award debrief for use in making future decisions to pursue similar work, and convert your opportunity to a contract when you win the work. Coming soon with the release of Costpoint 8.1, you will have the ability to do opportunity assessments, which can help you quickly identify strengths and weaknesses to ensure there are no subjective bidding decisions, and that your resources are focused on opportunities that matter most. With this new feature, you can manually enter opportunity assessments, or import them from GovWin IQ giving you all of your opportunity information in one location.
In addition to opportunity assessments, with Costpoint 8.1 you will be able to track the CMMC level associated with each opp. This can be imported from GovWin IQ as well or manually added to an opportunity, allowing you to easily track which opportunities have CMMC requirements. Costpoint will flow info from the opportunity to the contract and to the project to minimize duplicate entry and streamline project initialization.
#2: Streamline Management of Contracts & Subcontracts
You’ve established a healthy pipeline, you’ve won the contract - now what? The next crucial part of simplifying the source to pay cycle is to streamline your existing contract (and subcontract) management process. Costpoint Contract Management allows contract managers to easily track financial and non-financial aspects of a contract, activities, FAR/DFARS clauses, modifications, supplements, provisions and other important contract details at any point during the pre- or post-award process. Costpoint can initiate the opportunity record directly from GovWin IQ or it can be manually entered; once the record is created, you can manage RFP activity, set and track key milestone dates for RFP preparation and submission, manage related documents, and monitor activities that occurred during the proposal process.
Within the contract record, you can track contract funding and maintain administrative mods as needed. The contract record is linked to your projects, charge tasks, and delivery orders, and you can also attach documents and monitor activities related to the contract. Using the built in FAR/DFARS library, you can flow down FAR clauses or other regulatory requirements to your teammates. As the contract progresses, the team can evaluate and rate vendors which is invaluable for determining which vendors to use in the future. Once the contract is completed, the contract closeout activities can be populated and the information can be used for future decision making.
With Costpoint’s Subcontractor Management functionality, your teammates are tied to your contract and project. You can flow down the FAR/DFARS and other regulatory requirements down to purchase orders. You will be able to identify which portion of your total contract/project value has been obligated to your teammates, see the remaining funding on that obligation, manage subcontract modifications, and rate your supplier’s performance.
#3: Successfully Enable Suppliers, Vendors, and Subcontractors
Once the contract is won, the third key area of focus in order to streamline the Source to Pay is in the process of procuring and managing your suppliers and vendors. Costpoint’s integrated procurement process enables management of your purchases entirely within the system, moving from requisition to approval, then to electronic PO with all required flow downs and standard text, through receipt and inspection of parts and goods. For the most streamlined experience, suppliers and vendors are enabled to update and self-answer invoices and purchase order/shipping notifications. Plus, they can attach documents and capture details on vendor status, subcontractors, NAICS codes, and more. Finally, contractors can improve invoicing accuracy and cycle times by enabling subcontractors to enter their own time and expenses.
With Costpoint’s Supplier Portal, you can track, access, and update all of your communications with suppliers and subcontractors in one central location. Buyers, suppliers and subcontractors can quickly glance at individual dashboards to see new POs, changes, and pending actions. Suppliers can acknowledge receipt, communicate delivery date changes, and enter address updates, while the system sends notification emails.
Process Optimization is Crucial
With Costpoint Source to Pay, government contractors can effectively streamline the entire source to pay process in a few key areas: ensuring pipeline health, simplifying contract and subcontract management, and centralizing communication and enablement to suppliers, vendors, and subcontractors. It is essential to optimize these processes; failure to do so can lengthen procurement cycle times and DPO, and create an environment where you are unprepared for a CPSR audit. Costpoint Source to Pay enables the simplification of the entire project lifecycle, from FAR/DFARS flow downs to PO collaboration, all on a single, secure platform.
If you’re interested in learning more about how Costpoint can simplify the entire Source to Pay process, check out our On Demand webinar: Streamlining Procurement and Vendor Management for Government Contractors
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