JPMorgan Xign (Pleasanton, Calif.), a global settlement network, launched Procure-to-Pay, an extension of its Order-to-Pay service that provides a complete solution for financial supply chain management, according to the treasury management provider, which was acquired by JPMorgan Chase in May. The service will help JPMorgan Chase's business customers integrate existing enterprise supply chain and financial operations, connecting buyers and suppliers via the Internet, JPMorgan Xign claims.
According to Chris Rauen, VP, product specialist for JPMorgan Xign, Procure-to-Pay automates catalog, contract and special-request buying through its supplier directory, transforming invoicing, payments and working capital activities. The solution, he says, will allow clients to better integrate procurement with accounts payable, supporting straight-through processing.
There are about 58,000 companies in JPMorgan Xign's shared suppliers directory, Rauen notes. "There is no charge for suppliers to participate," he explains, adding that customers can realize profit gains of up to 1 percent to 2 percent through a strategic payables approach that incorporates purchasing card rebates, early payment discounts and supply chain financing options.
New York-based JPMorgan Chase's ($1.5 trillion in assets) own global procurement and accounts payable organizations will be the first to deploy the Procure-to-Pay service, Rauen relates. The rollout is set for the end of 2008, and the bank currently is defining its requirements for the system, he adds.
Today, there are more than 50 customers using Xign, Rauen says, including Fortune 2000 companies such as MetLife (New York), Sprint (Overland Park, Kan.) and Verizon Wireless (Basking Ridge, N.J.).
"Outsourcing of highly manual, paper-intensive, noncore operations such as accounts payables is an excellent way for companies to reduce costs, improve controls and provide management with detailed, accurate and timely reporting," said Nancy Atkinson, senior analyst with Aite Group (Boston) and author of a report on accounts payable outsourcing, in a release. Among other efficiency gains, automating accounts payable accelerates invoice approval resolution and enables 100 percent of invoices to be processed within 30 days, compared to only 15 percent in a manual-processing environment, the report says.
At the time of JPMorgan Chase's acquisition of Xign, Atkinson said the deal helped the bank stand apart from its competitors by offering a method to link the two players in the supply chain, the buyer and the seller. The acquisition also enables JPMorgan Chase to capture large amounts of data that flow through the Xign network and leverage that information in other areas, she noted.
Other vendors in the accounts payable outsourcing market include ACS (Dallas), IBM (Armonk, N.Y), Infosys (Bangalore, India), IQ BackOffice (Encino, Calif.), NextProcess (Dallas), American Express Harbor Payments (Atlanta), Bottomline Technologies (Portsmouth, N.H.), SourceNet Solutions (College Station, Texas), BasWare Corp. (Espoo, Finland), Xerox (Stamford, Conn.) and AnyDoc Software (Tampa, Fla.).