2022-Coupa BSM Benchmark Report

THE 2022 BUSINESS SPEND MANAGEMENT (BSM)
BENCHMARK REPORT
United by
the Power
of Spend
20 Community-Powered KPIs for
Best-in-Class Performance Across
Procurement, Risk, Invoicing,
Expenses, and Payments
POWERED BY COMMUNITY.AI
THE COUPA BSM BENCHMARK REPORT
Table of Contents
Introduction: Why Community Data?................................................................................................................................ 3
United by the Power of Spend.............................................................................................................................................. 5
Environmental, Social, and Governance (ESG)................................................................................................................. 8

Spend With Diverse Suppliers................................................................................................................................................. 9
Source-to-Contract................................................................................................................................................................ 10
Contract Management Cycle Time...................................................................................................................................... 11
Structured Spend...................................................................................................................................................................... 12
On-Contract Spend.................................................................................................................................................................. 13
Primary Suppliers........................................................................................................................................................................ 14
Procurement.............................................................................................................................................................................. 15
Electronic PO Processing........................................................................................................................................................ 16
Requisition-to-Order Cycle Time.......................................................................................................................................... 17
Services Requisition-to-Order Cycle Time.......................................................................................................................... 17
Services Procurement Work Confirmation Cycle Time..................................................................................................... 18
Pre-Approved Spend................................................................................................................................................................ 19
Supplier and Third-Party Risk Management..................................................................................................................... 20

Supplier Information Management Cycle Time................................................................................................................. 21
Risk Management Evaluation Completion Rate................................................................................................................. 22
Risk Management Evaluation Cycle Time............................................................................................................................ 23
Invoicing..................................................................................................................................................................................... 24
Electronic Invoice Processing................................................................................................................................................ 25
Invoice Approval Cycle Time.................................................................................................................................................. 26
First-Time Match Rate.............................................................................................................................................................. 27
Expenses..................................................................................................................................................................................... 28
Expense Report Approval Cycle Time................................................................................................................................... 29
Expense Report Lines Within Policy...................................................................................................................................... 30
Payments................................................................................................................................................................................... 31
Invoices Paid Digitally.............................................................................................................................................................. 32
Suppliers Using Digital Payments.......................................................................................................................................... 33
Payment Batch Approval Cycle Time................................................................................................................................... 34
Conclusion: United by the Power of Spend...................................................................................................................... 35

About Coupa............................................................................................................................................................................. 37
INTRODUCTION
Why Community Data?

It’s a time of great change for many industries. Global events are forcing us to reevaluate our priorities and
ways of working.
If you’re going to make changes, it’s important to measure your progress. It’s equally important to have
standards — benchmarks — to compare against, so you can create tangible goals, take clear action, and
evaluate your progress.
Traditional Business Spend Management (BSM) benchmarks, which are based on self-reported survey
information, provide a useful but incomplete picture.
This report is the industry’s only collection of benchmarks based entirely on hard data from real business
spend transactions (a.k.a. community data). We gathered these data points through the power of Community.ai,
an initiative that combines data-driven insights with human-to-human connections. By analyzing anonymized
transactions from thousands of customers across the Coupa community, Community.ai is able to provide
a deeper level of insight than with survey data alone.
Insights from Community Data
6.3% 15.4% 6.5 Business $2M

OVERALL SAVINGS DIVERSE SUPPLIERS Hours PER BILLION IN SPEND
TO APPROVE EXPENSES IDENTIFIED AS SUSPICIOUS
Traditional spend management As efforts around Environmental, With business travel and expenses Coupa’s Community.ai intelli-
approaches typically yield 2% to Social, and Governance (ESG) (T&E) expected to rise, leading gently analyzes business spend
3% in savings relative to overall grow, best-in-class companies organizations took only 6.5 for potential fraud, user error,
spend. Top performers this year currently have 15.4% of their total business hours to approve and process avoidance. The
saved far more by applying BSM supplier base classified as diverse. expense reports. average buyer identified 0.2% of
best practices. their overall spend in Coupa to be
non-compliant.
The benchmarks later in this report represent best-in-class performance for each KPI. Each benchmark
measurement represents the median values of the top quartile of Coupa customers for that KPI.
By aggregating data from top performers on the Coupa BSM platform, we aim to provide you with a data-
driven perspective of what BSM success looks like, to guide your own digital transformation efforts.
Learn more about Community.ai
THE COUPA BSM BENCHMARK REPORT 3

INTRODUCTION
20 KPIs for Business Spend Management

Environmental,
Social, and Source-to-Contract
Governance (ESG)
Spend With Contract Structured Spend On-Contract Primary Suppliers

Diverse Suppliers Management Spend
Cycle Time
Procurement
Electronic PO Requisition-to- Services Procurement Pre-Approved Spend

Processing Order Cycle Time Work Confirmation
Cycle Time
Supplier and Third-Party Risk Management Invoicing
Supplier Information Risk Management Risk Management Electronic Invoice Invoice Approval First-Time
Management Evaluation Evaluation Processing Cycle Time Match Rate
Cycle Time Completion Rate Cycle Time
Expenses Payments
Expense Report Expense Report Invoices Suppliers Using Payment Batch

Approval Cycle Time Lines Within Policy Paid Digitally Digital Payments Approval Cycle Time

UNITED BY THE POWER OF SPEND
United by the Power of Spend

How to break down silos to solve today’s greatest
business challenges using Business Spend Management
“Business Spend Management allows us to have greater transparency and

insights to steer our business. We are not only able to control what people
are buying, but have the best possible conditions with our suppliers.”
—Zalando, German multinational fashion e-commerce company
SPEND IS THE FUEL OF BUSINESS

The best companies in the world see business spend as a driver of growth and success.
Though it often goes unnoticed, spend actually sits behind every company decision, whether you’re building
a more robust supply chain, satisfying your board’s Environmental, Social, and Governance (ESG) mandates,
or just trying to be more efficient.
How effectively you manage your spend impacts how successfully your organization runs.
SMARTER SPENDING CAN HELP YOU OVERCOME TODAY’S BIGGEST CHALLENGES

Today’s environment is particularly unforgiving of poorly run organizations. Operating a modern business
requires being resilient (when faced with global disruptions) while also being responsible (contributing to
sustainability, diversity, and social impact).
Each of these challenges is notoriously difficult, and only the best-run organizations can tackle both
simultaneously. This is where the smart, strategic management of business spend can really make a difference.
By having visibility and control over your entire end-to-end spend management processes — from sourcing,
to payments, to supply chain design — you can make real-time decisions to optimize your business, no matter
what outside factors are at play.
The practice of harnessing the power of spend comprehensively across your organization is what we call
Business Spend Management (BSM). It’s best accomplished with smart processes, sharp people, strong
supplier relationships, and, crucially, data and technology.
Learn more about the power of spend

DIGITAL TRANSFORMATION OF SPEND MANAGEMENT

To understand the power of BSM, we need to remember how companies managed spend historically.
Along with customers and employees, suppliers are critical to the success of any organization. Yet, over the
last two decades, major digital transformation investments have focused mainly on customer-facing initiatives.
The domain of suppliers and spend stayed in the background, stuck with legacy technology stacks.
Now, as business environments become more complex, companies are taking a wider look at how digital
transformation of spend management can produce results.
BSM is increasingly seen alongside Customer Relationship Management (CRM) and Human Capital Management
(HCM) as a core competency of successful organizations.
WHY BSM WORKS

BSM starts with using technology to obtain a unified view of all the spend in your organization. Along with
this comes the capability and agility to make quick decisions while mitigating risks. When implemented
properly, BSM allows you to make better choices about which suppliers you work with, what initiatives
you invest in, and how nimble and effective your organization is.
BSM is more than just procuring, sourcing, invoicing, making payments, handling contracts, managing
suppliers, or doing any other single business activity alone. It’s about harmonizing a broad range of
spend-related processes together so that overall business value is maximized.
BSM maximizes value by:
OPTIMIZING IMPROVING OPERATIONAL REDUCING

SPEND AND CASH PERFORMANCE RISK
Empowering you to use your Reducing time and effort and Emphasizing compliance and
financial resources more freeing up resources to focus on governance so you can be more
thoughtfully and strategically. higher-value, strategic work. aware of the risks involved when
using third parties and mitigate them.
As you read through the KPIs in this report, you’ll see which of these three areas benefits the most
from performance improvements.


Unlike digital transformation efforts around CRM and HCM, which successfully broke down data silos
and provided centralized workflows for all stakeholders, spend and supply chain processes too often
remain fragmented.
The good news is that organizations are starting to make changes. Leaders are realizing that sourcing,
procurement, finance, treasury, legal, compliance, supply chain, and sustainability teams need to be able
to work together to solve today’s greatest challenges. And across organizations, the BSM community is
coming together to share insights and best practices.
This annual report demonstrates the exceptional achievements of organizations that have made solid
progress in their BSM journeys. It’s also a testament to a BSM community that believes we can all grow
stronger and build a better world by learning from one another. For this reason, each benchmark in this
report is paired with strategies that have worked for many organizations and that we believe will fuel your
own transformation success.
Ready to start your journey?

Let’s go!

Environmental, Social,
and Governance (ESG)
“We have a more assertive and precise vision of

the opportunities. A common goal is to meet the
ESG targets set by the company for 2025, 2030,
and 2050.”
—Saint Gobain, French multinational manufacturer
• Achieving ESG goals has become

a business imperative of growing
importance to boards of directors,
investors, customers, employees,
and the general public. Companies
are expected to prioritize meaningful
ESG initiatives, measure impact, and
be transparent about their progress.
• Those in procurement, finance, and

supply chain play key roles in creating
a positive impact for their companies
by integrating ESG considerations
into their spending decisions and
measuring impact.
• Supplier diversity, in particular, is a

growing corporate ESG priority that
can be readily measured with data
and technologies available today.
Learn more about Sustainable

Business Spend Management

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE (ESG) > SPEND WITH DIVERSE SUPPLIERS
Spend With Diverse Suppliers
23.9%
PRIMARY BENEFIT:
OPTIMIZING SPEND
AND CASH
DEFINITION:
Spend With Diverse Suppliers measures how HOW TO IMPROVE:
HIGHER IS BETTER
much of a company’s total spend goes to
suppliers classified as diverse across a range of • Require at least one diverse supplier
categories established by governments around to be included in each sourcing event.
the world. Provide diversity managers with visibility
into non-diverse in-flight sourcing events
and spend requisitions, so that they can
WHY IT MATTERS: proactively provide support.
• Companies have set commitments to • Monitor diverse suppliers for risk

increase their business with diverse indicators and proactively intervene
suppliers, as part of their ESG programs. by extending more generous payment
terms or reviewing general contract
• Government contractors are required requirements that may cause hardship.
to track their spend with diverse suppliers
and meet aggressive targets (15% of their • Participate in community-powered
total spend, in the U.S.). programs that provide pre-sourced,
diverse suppliers in common categories.
• Buying from diverse suppliers creates Flag diverse suppliers to end users
real impact by directly supporting diverse directly within the search results of
owners, their employees, and by increasing your procurement software.
economic activity within their communities.
Learn more about working

with diverse suppliers

Source-to-Contract
“Contract Lifecycle Management proved to be a big

win for IT, procurement, and legal — we were able
to complete a critical contract in weeks that would
have taken months to negotiate before.”
—Sonic Automotive, American automotive retailer
• As a result of recent economic disruptions,

spend management professionals are
reexamining their approach to contracts.
Some are favoring more contracts
with shorter term durations. Others
are choosing to go “all-in” with a few
trusted suppliers.
• Being able to deftly create, access,

and apply contracts is essential. Quickly
moving the results of sourcing activities
and risk mitigation terms into contracts
increases agility and maximizes the value
of supplier negotiations.
Learn more about the connections

between sourcing and contracting

SOURCE-TO-CONTRACT > CONTRACT MANAGEMENT CYCLE TIME
Contract Management Cycle Time
8.1 Business Days

PRIMARY BENEFIT:
IMPROVING OPERATIONAL
PERFORMANCE
DEFINITION:
Contract Management Cycle Time is the HOW TO IMPROVE:
LOWER IS BETTER
time between requesting a contract and
the contract being signed. • Implement Contract Lifecycle
Management (CLM) capabilities that
are tightly connected to sourcing and
WHY IT MATTERS: third-party risk to accelerate drafting and
to ensure that sourcing results and risk
• Typically, companies have already done protections are recorded accurately.
the up-front work of sourcing a supplier
to meet a business need. A contract is • Use standard contract clause language,
necessary to formalize the relationship. digital workflows and approvals, and risk
Long contract cycle times delay the scoring to accelerate contract review
business benefits of new agreements. and approval.
• Long cycle times also cause the business • Connect your CLM directly to purchasing
to start working with the new supplier and invoice validation to immediately start
before the contract is actually signed. realizing the value of negotiations.
This creates risk because any protections
in the contract are not yet in force.
• Faster time to execute contracts also

removes uncertainty in the overall
supply chain, leading to better planning Learn about integrating CLM
and quicker business enablement. into your procure-to-pay
(P2P) processes

SOURCE-TO-CONTRACT > STRUCTURED SPEND
Structured Spend
64.8%
PRIMARY BENEFIT:
OPTIMIZING SPEND
AND CASH
DEFINITION:
Structured Spend describes the percentage of HOW TO IMPROVE:
HIGHER IS BETTER
spend that goes through company-hosted and
vendor-hosted catalogs (a.k.a. punch-outs). • Use digital systems to easily create
vendor catalogs with minimal effort
for you and the vendor.
WHY IT MATTERS:
• Make sure the buying experience is
• Catalogs and guided forms drive control, seamless and intuitive. Can employees
efficiency, and lower prices. Standard item easily search for what they need? Do the
descriptions with preferred prices and terms right items show up in search results?
avoid the proliferation of items and suppliers
that result from ad-hoc purchases. • If possible, use proven, trusted
platforms and programs to reduce
• Maximizing structured spend offers a the workload of establishing catalogs
scalable way to manage change and and punch-outs.
enables your business to adapt quickly
as goods and services are introduced.
• Employees benefit from having more

information regarding availability, discounts, Learn more about
and shipping costs; suppliers benefit from source-to-pay (S2P)
fewer errors in communication.

SOURCE-TO-CONTRACT > ON-CONTRACT SPEND
On-Contract Spend
79.2%
PRIMARY BENEFIT:
OPTIMIZING SPEND
AND CASH
DEFINITION:
On-Contract Spend measures the percentage HOW TO IMPROVE:
HIGHER IS BETTER
of spend put through pre-negotiated contracts
to enable better prices and terms. • Implement a category sourcing strategy
in which the categories that deliver
the greatest value to the business are
WHY IT MATTERS: strategically sourced with negotiated
prices and terms.
• Having greater on-contract spend
reduces the financial risk and business • Ensure that contracts are quickly and
costs from supplier liability or wrongdoing easily implemented into purchasing policy
by channeling spend to suppliers who through an integrated CLM system.
have risk-related contract protections.
• Make sure your procure-to-pay (P2P)
• Greater spend on contract enables system is easy to use for employees,
procurement to negotiate even better and that it automatically serves up
terms and lower pricing in the future by contracted goods and services in the
highlighting the fact that a large amount of search results.
spend has gone through existing contracts.
• Since payment terms are negotiated

in the contract, getting more spend
on contract lets you take advantage
of favorable payment terms, which Learn more about
improves cash flow. managing contracts

SOURCE-TO-CONTRACT > PRIMARY SUPPLIERS
Primary Suppliers
19.9%
PRIMARY BENEFIT:
OPTIMIZING SPEND
AND CASH
DEFINITION:
Primary Suppliers is the percentage of total HOW TO IMPROVE:
HIGHER IS BETTER
suppliers with whom a company spends 80%
of its total spend. • Perform spend analysis for high-value
categories and identify top suppliers
for each category. Determine which
WHY IT MATTERS: of the remaining suppliers can be
eliminated with minimal disruption or
• Tail suppliers (those with whom an risk to your business.
organization spends very little) are made
up of niche suppliers for important goods • Consolidate tail suppliers and redistribute
and services and duplicate suppliers in their expected spend to preferred
categories that haven’t been sourced or suppliers in exchange for lower prices
managed properly. and/or better terms. Work with business
units to find trusted suppliers who can
• Spending with tail suppliers is undesirable meet several needs.
because you aren’t consolidating your
spend to get better prices. It also creates • Duplicate tail suppliers often are
excessive costs and potential danger, associated with spend that isn’t
since resource constraints often force pre-approved. Adopting a P2P system
risk management efforts to prioritize will lead to more pre-approved
suppliers with greater spend. spend and fewer duplicate suppliers.
• Reducing tail suppliers (increasing • Use automation to free up sourcing

primary suppliers) generates increased resources, giving more time for
value through negotiated contracts, category management and reduction
greater buying power, lower risk, and of tail spend.
favorable payment terms.
See how Australian Leisure and

Hospitality Group (ALH Group)
consolidated suppliers

Procurement
“Procurement professionals, armed with best-in-

breed technology, best in-class process, and
modernized policies, are best positioned to unlock
the greatest value for their companies, while
simultaneously elevating to trusted advisors
within their organizations.”
—ADM, American multinational food processing and
commodities trading corporation
• Procurement’s agenda is full of responsibilities

that didn’t exist a few years ago. The area is
at the center of strategic conversations around
operational resilience, social responsibility,
and sustainability. Delivering on these goals
is a tremendous opportunity to take on
new challenges, but also carries significant
pressure as procurement’s longstanding
goals of savings and efficiency remain.
• Procurement's success hinges on several

factors including: having complete visibility into
company spend, ensuring strong relationships
with suppliers, and driving digitalization.
Learn more about the top

priorities of today’s CPOs

PROCUREMENT > ELECTRONIC PO PROCESSING
Electronic PO Processing
99.0%
PRIMARY BENEFIT:
PERFORMANCE
DEFINITION:
Electronic PO Processing describes the HOW TO IMPROVE:
HIGHER IS BETTER
percentage of total purchase orders that
are approved and received by suppliers • Set up your (P2P) system so that it’s
electronically. user-friendly to the business and to
suppliers, and provide ample education
to those using the system.
WHY IT MATTERS:
• Consider implementing a “no-PO,
• Many companies still struggle with no-pay” policy, which ensures that
highly manual PO processes. Digitizing employees and suppliers are fully
purchase orders includes the electronic incentivized to submit accurate
transmission and supplier confirmation information electronically.
of POs.
• Ensure that most of a supplier’s goods
• This drastically reduces low-value, or services can be ordered through
manual work while accelerating the a structured buying channel, such
process to manage, confirm, and as catalogs. A lack of proper supplier
change POs. enablement often prevents a higher
percentage of electronic PO processing.
• Digitization also helps avoid manual
errors in aspects such as quantity,
price, and terms.
Learn more about digital

transformation across different
stages of procurement maturity

PROCUREMENT > REQUISITION-TO-ORDER CYCLE TIME, SERVICES REQUISITION-TO-ORDER CYCLE TIME
Requisition-to-Order Services Requisition-to-Order

Cycle Time Cycle Time
4.5 Business Hours 5.6 Business Hours

PRIMARY BENEFIT: IMPROVING OPERATIONAL PERFORMANCE
DEFINITION:
Requisition-to-Order Cycle Time is the HOW TO IMPROVE:
LOWER IS BETTER
average time it takes to process purchase
orders, from the initial requisition to the final, • Simplify policies to minimize the
approved PO. number of approvers (especially when
the total cost is below a certain amount)
Services Requisition-to-Order Cycle Time while maintaining the appropriate level
is the average time it takes to process POs of control against risk or fraud. If you
related to services procurement, which often have approvers in your workflow who
have more complex approval processes. never reject, consider removing them
or making them watchers.
WHY THESE METRICS MATTER: • Implement a buying channel strategy that

routes the goods and services with the
• With greater uncertainty in today’s supply greatest order volumes through hosted
chains, shorter cycle times can reduce catalogs, punchouts, and automated,
delays in procuring critical items and guided-buying processes. This way users
services and accelerate business. can quickly find what they need with
minimal manual approvals required.
• Shorter cycle times improve employees’
experience with the ordering process, • Leverage gamification capabilities to
creating greater user adoption of spend show end users if they’re approving faster
management systems and maximizing or slower than others at their company.
spend under management.
• Reducing cycle times increases supplier

satisfaction, thereby strengthening
supplier relationships.

PROCUREMENT > SERVICES PROCUREMENT WORK CONFIRMATION CYCLE TIME
Services Procurement Work

Confirmation Cycle Time
8.0 Business Hours

PRIMARY BENEFIT:
PERFORMANCE
DEFINITION:
Services Procurement Work Confirmation HOW TO IMPROVE:
LOWER IS BETTER
Cycle Time is the time between when the
supplier submits a time sheet to the customer • Use a consolidated BSM platform for
and when the customer completes approvals. purchasing all goods and services to
drive adoption and avoid approval delays.
WHY IT MATTERS: • Review and optimize current approval

conditions and hierarchy to limit the
• Better visibility into actual costs and number of approvers needed.
progress of projects helps managers
proactively identify and reduce the • Ensure that approval authority is
impact of any issues sooner. transferred when an approver is out-
of-office or leaves the organization.
• This allows for better planning, a better
sense of overrunning budget, and
greater ability to “pump the brakes”
and bring projects in on time.
• Shorter cycle times improve supplier Learn about managing

relationships by giving suppliers better contingent workforces
insight into work that’s been approved,
reducing billing cycle times.

PROCUREMENT > PRE-APPROVED SPEND
Pre-Approved Spend
95.3%
PRIMARY BENEFIT:
OPTIMIZING SPEND
AND CASH
DEFINITION:
Pre-Approved Spend is the total amount of HOW TO IMPROVE:
HIGHER IS BETTER
invoiced spend linked with approved POs.
• Deploy a P2P system that makes it
WHY IT MATTERS: frictionless for employees to purchase
what they need. Simultaneously
• Spend that’s pre-approved is more consider “no-PO, no-pay” policies.
likely to go onto negotiated contracts,
resulting in lower prices and better • Improve the onboarding processes
terms. Pre-approval also helps avoid for new suppliers so that it’s easier
unnecessary spend and ensures that for both buyers and suppliers to
budget limits are met. transact quickly.
• Pre-approved spend gives finance teams • Implement a category strategy such

visibility into spend that’s committed but that high-spend categories have
not invoiced, making it easier to generate pre-negotiated prices, terms, and
accurate accrual estimates. It also helps approval rules.
to avoid paying fraudulent invoices via
improved invoice matching against POs.
• It’s easier to get pre-approved spend onto

virtual cards, which has advantages for Read more about
liquidity in terms of leveraging the virtual pre-approved spend
card’s payment cycle, in addition to the
benefits of not having to process invoices.

Supplier and Third-Party
Risk Management
“We were very quickly able to pull information:

here’s a view of our concentration risk by country,
here’s a view of higher risk for cybersecurity.
Having all of that in a single repository from end
to end, it was invaluable to us.”
—Bank of Montreal, Canadian
multinational investment bank
• The relationship between buyer and

supplier is so critical that it can determine
whether business continues or suddenly
stops during a disruption or inciting inci-
dent. Creating mutual trust with suppliers
is essential for reducing third-party risk.
• As the buyer, you’re responsible for

multi-tier supplier actions in many areas
that you can’t fully mitigate with simple
liability protections, especially in areas
like information security, ethical sourcing,
anti-slavery, and conflict minerals. Potential
negative impacts of supplier risk include
fines from regulators and serious brand
damage. Identifying your most important
suppliers and their associated risks is a
crucial first step to strengthening your
supplier relationships and mitigating risk.
Learn more about third-party

risk management

SUPPLIER AND THIRD-PARTY RISK MANAGEMENT > SUPPLIER INFORMATION MANAGEMENT CYCLE TIME
Supplier Information
Management Cycle Time
1.6 Business Hours

PRIMARY BENEFIT:
PERFORMANCE
DEFINITION:
Supplier Information Management Cycle HOW TO IMPROVE:
LOWER IS BETTER
Time is the time it takes for suppliers to
respond to digital requests to update their • Use BSM platforms that let you ask for
supplier information. missing supplier information at the time
when the supplier is most engaged —
when they’re receiving a PO or trying
WHY IT MATTERS: to submit an invoice.
• Inaccuracies or gaps in supplier data can • For example, you can warn suppliers
lead to major problems for businesses. that you won’t be able to pay them
Suppliers may change their bank accounts without updated banking information
or payment information and fail to notify at the time that they’re submitting
buyers, resulting in bank fees and delays. an invoice.
• Delays in submission of up-to-date • Make sure your P2P and supplier-

certificates and other information management systems focus on user
lead to costly manual follow-up for experience not just for the buyer, but
supplier managers. for the supplier as well.
• Suppliers managing their own information

through a self-service digital process
prevents error and fraud — no more manual
data entry errors, no unauthorized changes.

SUPPLIER AND THIRD-PARTY RISK MANAGEMENT > RISK MANAGEMENT EVALUATION COMPLETION RATE
Risk Management
Evaluation Completion Rate
82.6% PRIMARY BENEFIT:

REDUCING RISK
DEFINITION:
Risk Management Evaluation Completion HOW TO IMPROVE:
HIGHER IS BETTER
Rate measures the completion rate, by
third parties, of digitally administered risk • Include a requirement for suppliers to
questionnaires. complete risk questionnaires periodically
as part of the terms and conditions of
doing business with you.
WHY IT MATTERS:
• Select an easy-to-use platform for
• Businesses interact with many third suppliers and monitor where suppliers
party suppliers of goods and services; get stuck or ask questions.
some carry out critical functions for the
organization. It’s important to identify • Ensure that it’s easy to update or
the suppliers and any subcontractors add to your evaluation questionnaires
who represent risk in areas like to address any sticking points and
information security. incorporate compliance with new and
changing regulations as needed.
• By sending out risk questionnaires
to critical third parties digitally, you
can more efficiently understand the
risk and mitigation measures in place,
allowing you to assess a greater number Learn more about
of suppliers and perform vetting more evaluating vendor risks
frequently and consistently.
• Digital risk assessments also reduce

the manual work of your organization’s
risk team, freeing them up to focus on
higher-value activities.

SUPPLIER AND THIRD-PARTY RISK MANAGEMENT > RISK MANAGEMENT EVALUATION CYCLE TIME
Risk Management
Evaluation Cycle Time
37.4 Business Hours PRIMARY BENEFIT:

REDUCING RISK
DEFINITION:
Risk Management Evaluation Cycle Time is the HOW TO IMPROVE:
LOWER IS BETTER
time it takes for third parties to respond to risk
assessments. • Require suppliers to complete risk
evaluations within a certain time period
as part of the terms and conditions of
WHY IT MATTERS: doing business with you.
• The faster critical third parties complete risk • Review assessments and identify
assessments, the faster the information can opportunities to simplify, such as by
be evaluated and scored, and the greater the better targeting questions to the relevant
service levels to the business can be. inherent risks of the relationship.
• Buyers can make decisions regarding • Centralize third-party risk management

supplier preferences and alternatives faster. on a single BSM platform across the
company to avoid a single supplier
getting multiple assessments from
different parts of the company or being
asked to provide information they’ve
already provided.
Learn more about managing risk

for better resilience and compliance

Invoicing
“For AP and purchasing, opening global offices and

having international operations was kind of like
the scene from ‘Harry Potter’ where the envelopes
come flying in through the door. It was obvious that
our payment processes had to be fixed quickly.”
—Ionis Pharmaceuticals, American biotechnology company
• Because of the financial stakes, high-

value accounts payable (AP) personnel
need to be focused on managing
payables and estimating accruals,
not on processing loads of paper or
PDF invoices. The delays and errors
incurred when processing paper or PDF
invoices hamper financial reporting,
negatively impact working capital
management, and open the door to
duplicate payments and fraud.
• Digital invoicing prevents invoices

from getting lost or forgotten. This
helps accruals because you’re able to
process more invoices each period before
closing AP. If invoices are received just
prior to close, they are more likely to be
processed by the time of close because
digital invoice processing time is faster.
Learn more about digitizing AP

INVOICING > ELECTRONIC INVOICE PROCESSING
Electronic Invoice Processing
80.1%
PRIMARY BENEFIT:
PERFORMANCE
DEFINITION:
Electronic Invoice Processing represents the HOW TO IMPROVE:
HIGHER IS BETTER
percentage of invoices processed through any
electronic, highly automated means. • Require that your business uses a system
that unifies strong invoicing capabilities
with procurement processes (i.e., a
WHY IT MATTERS: comprehensive BSM platform), which
enables invoices to be automatically
• Replacing paper with electronic invoicing matched against POs and receipts.
improves compliance by having automated
controls that catch out-of-compliance • Ensure that your BSM platform provides
invoices. Additionally, suppliers can gain suppliers with a modern, user-friendly
real-time visibility into invoice approval experience to encourage the adoption
and payment status, which can streamline of electronic invoicing.
dispute management.
• Provide open, frictionless access to
• A high percentage of electronic invoices multiple automated channels for
also makes it more likely that payments are suppliers to submit invoices while
made on time, not sooner or later, which, maximizing their visibility into the status
in turn, optimizes working capital and of their invoices and payments.
strengthens supplier relationships. It also
ensures that early payment discounts can
be leveraged when desired, since invoices
with early payment terms are automatically
paid early, thus ensuring compliance.
Learn more about
invoicing management
• Paper reduction also provides significant
environmental benefits.

INVOICING > INVOICE APPROVAL CYCLE TIME
Invoice Approval Cycle Time
11 Business Hours
PRIMARY BENEFIT:
PERFORMANCE
DEFINITION:
Invoice Approval Cycle Time is the average HOW TO IMPROVE:
LOWER IS BETTER
time from when an invoice enters the system
to the time that it’s approved for payment • Consider policies that vary the approval
(but not necessarily paid). chains depending on the amount
or category.
WHY IT MATTERS: • Configure systems to automatically

approve pre-approved, low-amount
• With paper invoices and disjointed invoices. For example, invoices under
approval processes, it can take days, if $1,000 that are PO-backed can be
not weeks, to approve a simple invoice. auto-approved or approved with just
Accounting teams do not have visibility one approver in the chain.
into the backlog of unprocessed invoices.
• Consider going from three-way match
• Faster approval times help avoid late (with receipts) to two-way, approving
payments, penalties, and potential invoices only. This way, employees don’t
supplier frustration, which in severe need to be trained on the receipts
cases may even void contracts or lead process and the invoices process (just
to the refusal of future projects. on invoice approvals).
• Faster approvals can improve returns

on working capital by realizing early
payment discounts and can enable
finance teams to close the books faster, Learn 5 key steps to
as invoices are processed in a more transforming your AP process
timely manner.

INVOICING > FIRST-TIME MATCH RATE
First-Time Match Rate
87.4%
PRIMARY BENEFIT:
PERFORMANCE
DEFINITION:
First-Time Match Rate describes the percentage HOW TO IMPROVE:
HIGHER IS BETTER
of invoices that are two-way or three-way
matched with POs and receiving documents • By digitizing POs and invoices,
without the need for exception handling. companies can see a massive increase
in first-time match rate.
WHY IT MATTERS: • By having procurement and invoicing

capabilities on a single platform, a
• A high match rate indicates efficiency, supplier can “flip” a PO into an invoice —
since invoices that fail the match have automatically creating an invoice based
to be reviewed manually. on the PO information accurately.
This leads to a high match rate.
• A high match rate can also signal the
effectiveness of compliance policies and • To improve efficiency even more, when
substantially benefits risk mitigation. a three-way match occurs, companies
can opt to automatically pay invoices
that match within certain tolerances —
creating a “touchless” AP process.
Learn more about

AP automation

Expenses
“We decided to do the T&E project for two reasons:

one, to automate the T&E process and two, we’ll
actually be able to streamline that process and
take a tremendous amount of workload off the
approvers in the field.”
—Service Corporation International (SCI), American
provider of funeral goods and services
• It’s critical to have full visibility

into your employees’ expenses in
order to control costs and ensure
compliance with corporate policies.
• Smarter expense management

can help reduce spend leakage,
ensure compliance with policies,
and drastically improve efficiency
by reducing manual labor.
• With business travel on the rise again,

optimizing your travel and expenses
(T&E) program will be key for getting
ahead of potential challenges.
Learn about end-to-end

T&E management

EXPENSES > EXPENSE REPORT APPROVAL CYCLE TIME
Expense Report Approval Cycle Time
6.5 Business Hours

PRIMARY BENEFIT:
PERFORMANCE
DEFINITION:
Expense Report Approval Cycle Time is the HOW TO IMPROVE:
LOWER IS BETTER
average time from when an expense report
enters the system to the time that it’s approved • Encourage the electronic capture
for payment. of receipts when expenses occur.
• Make use of AI to read the contents

WHY IT MATTERS: of receipts and auto-populate expense
categories and fields.
• For employees who are expensing items,
or even services (like internet and phone • Enable and promote the use of mobile
bills), it's a major source of frustration to devices for real-time, in-field expense
not be reimbursed quickly. report submissions, in order to drive
adoption of expense management
• Having a short approval time encourages technology and therefore increase
the timely submission of expenses and control, compliance, and spend under
improves budget control. management.
• Paper or spreadsheet-based processes and

disjointed expense management systems
make it nearly impossible for AP to process
expense reimbursements quickly. Learn about comprehensive
T&E management

EXPENSES > EXPENSE REPORT LINES WITHIN
Expense Report Lines Within Policy
98.0% PRIMARY BENEFIT:

REDUCING RISK
DEFINITION:
Expense Report Lines Within Policy measures HOW TO IMPROVE:
HIGHER IS BETTER
the percentage of lines that meet policy limits
within expense reports. • Implement a system with real-time
notifications or warnings that a specific
line, as drafted by the employee, might
WHY IT MATTERS: not be within policy.
• Even when companies have clear expense • Leverage AI to monitor expenses

report policies in place, employees may to rapidly identify non-compliance.
be unaware of these policies and submit
non-compliant expenses. With managers • Reference community data to
typically approving these reports without benchmark your policies to identify
detailed review, human error is rampant where changes should be made for
and compliance is compromised. more effective compliance.
• Having more expense report lines that are

compliant with T&E policy indicates that
expenses are being managed effectively.
• This, in turn, reduces the overhead of Learn more about the latest
manual audits (easing administrative approaches to T&E management
burden) and also reduces the time to
reimbursement for employees.

Payments
“Prior to having digital payments, the process of

paying the vendors was a pain. We were doing
them in our ERP system. And that payment file
used to be erroneous many times, so you have
to manually update the files, which is not best
practice for compliance.”
—ThoughtSpot, American business intelligence
analytics software company
• In today’s remote work environment,

paper-based payments are a burden as they
increase logistical complexity for manually
approving and disbursing payments to suppliers.
• Digital payment solutions offer many

advantages in agility and efficiency.
By digitizing the data transfer process for
approved invoices and expenses from your
P2P system to the bank to make payments,
you break down silos, enable automatic
reconciliation, and mitigate risk of error
and fraud.
• By issuing one-time virtual cards for

pre-approved purchases instead of having
high-limit corporate credit cards, you reduce
exposure to credit card fraud. Virtual cards
also help drive more spend under management
by enabling companies to maximize bank
rebates, thereby optimizing working capital
while gaining greater control.
Learn more about

digital payments

PAYMENTS > INVOICES PAID DIGITALLY
Invoices Paid Digitally
86.1%
PRIMARY BENEFIT:
PERFORMANCE
DEFINITION:
Invoices Paid Digitally describes the percentage HOW TO IMPROVE:
HIGHER IS BETTER
of invoices that are tied to digital payments out
of all the total electronic invoices processed on • Implement digital payments capabilities
the Coupa BSM platform. into your P2P system to enable data
continuity, automated bank statement
reconciliation, and multiple automatic
WHY IT MATTERS: checks to reduce errors.
• Increasing digital payments reduces • Expand your digital payment strategy

transaction fees by optimizing payment to include virtual cards. By including
rails, improves operational efficiency by a “get paid by card” offer in your POs,
reducing manual effort, and also reduces the you can shift the invoice and payment
possibility of errors, thereby mitigating risk. process electronically, cutting out paper.
• Digital payments offer a chance to optimize • Remind suppliers of the advantages

working capital, increase savings through of digital payments — they’ll be able to
rebates for virtual cards, realize early pay track the progress of their payments
discounts, and strengthen relationships online, and there’s no need for their
with suppliers even further by reducing the accounts receivable (AR) teams to
amount of time and error in paying suppliers. manage paper. Increase adoption by
including terms for making digital
• Digital payments enable automatic, payments in negotiated contracts.
digital reconciliation, which allows your
AP and accounting department to operate
in a “touchless” way. Also, payment security
and payment fraud protection are improved
when invoices are paid digitally. Learn about 5 common
payment pain points

PAYMENTS > SUPPLIERS USING DIGITAL PAYMENTS
Suppliers Using Digital Payments
85.2%
PRIMARY BENEFIT:
PERFORMANCE
DEFINITION:
Suppliers Using Digital Payments reflects the HOW TO IMPROVE:
HIGHER IS BETTER
percentage of suppliers who receive payments
digitally, i.e. not via paper checks or external • Make sure that you have accurate supplier
bank-to-bank transfers. information as a foundation. Get as many
suppliers enabled onto your payments
platform as possible. Incentivize adoption
WHY IT MATTERS: by offering early payment discounts or
flexible payment terms.
• Digital payments streamline your AP
process, since all of your payments are • Increase supplier awareness of virtual
made from the same system. You can card payments. Verify to see if one-time,
track and address payments in one place, long-tail suppliers will accept virtual
increasing efficiency. cards as a payment method. Include
payment by virtual card as a preferred
• Digital payments also ensure that there method when issuing a PO.
are proper controls in place, increasing
compliance. By setting rules on who • Leverage a BSM platform that reveals
can approve and how the approval chain suppliers who are already accepting
works, digital payments reduce opportuni- digital payments with other buyers and
ties for bad actors to commit fraud. prioritize enabling digital payments with
those suppliers.
• Digital transformation of the payments
process better supports today’s remote
working environment and sets up
organizations to be agile and flexible
regardless of physical footprint.
Learn about transforming
business payments

PAYMENTS > PAYMENT BATCH APPROVAL CYCLE TIME
Payment Batch Approval Cycle Time
1.6 Business Hours

PRIMARY BENEFIT:
PERFORMANCE
DEFINITION:
Payment Batch Approval Cycle Time HOW TO IMPROVE:
LOWER IS BETTER
measures how quickly a payment batch
made to a supplier can be approved. • Streamline approvals whenever possible
by minimizing the complexity of the
approval chain / approval matrix.
WHY IT MATTERS:
• Have multiple releasers for any approval
• Streamlining the batch approval process process so that no bottlenecks develop
digitally allows for greater automation, if a single approver is unavailable for
faster and more secure approvals, and any reason.
overall increased efficiency.
• By paying suppliers faster and on time,

you strengthen supplier relationships.
You can take this further by leveraging the
benefits of early payment discounts. Learn about recent
payment trends
• A digital process not only shortens
approval time, it ensures a separation
of duties in the approval chain — everyone
has a clearly defined role. This reduces
confusion and creates security.

CONCLUSION
United by the Power of Spend

Today’s greatest business challenges require surpassing what procurement, finance, supply chain, and IT
functions have traditionally done alone. Every spending decision within a company carries the potential for
exponential impact on business and the world. Uniting around the common thread of business spend is
essential for fueling widespread success.
Business Spend Management is the method to harness the power of spend companywide. Businesses that
capitalize on BSM can deliver purpose, performance, and profitability. Technologies like cloud platforms,
machine learning, and AI have made it possible to optimize and manage business spend comprehensively,
with complete visibility and control.
Coupa’s cloud-native, enterprise-grade platform powers all the technology capabilities you need for BSM at
scale, including those needed to build resilient supply chains. Additionally, anonymized, aggregated community
data can help you benchmark your performance, make better buying decisions, and improve continuously.
To learn more about using Coupa for

your full BSM needs, check out our eBook
Unleash the Power of Spend.
Download the eBook here
Additional Links:
coupa.com/benchmark
coupa.com/solutions/suite-synergy
coupa.com/community
coupa.com/resources
coupa.com/customers
coupa.com/contact-us

CONCLUSION
20 KPIs for Business Spend Management

KEY PERFORMANCE INDICATOR GOAL BENCHMARK
23.9%
ESG
Spend With Diverse Suppliers HIGHER IS BETTER
Contract Management Cycle Time LOWER IS BETTER 8.1 Business Days

SOURCE-TO-CONTRACT
Structured Spend HIGHER IS BETTER 64.8%

On-Contract Spend HIGHER IS BETTER 79.2%
Primary Suppliers HIGHER IS BETTER 19.9%
Electronic PO Processing HIGHER IS BETTER 99.0%

PROCUREMENT
Requisition-to-Order Cycle Time LOWER IS BETTER 4.5 Business Hours

Services Procurement Work Confirmation
Cycle Time
LOWER IS BETTER 8.0 Business Hours
Pre-Approved Spend HIGHER IS BETTER 95.3%

PARTY RISK MANAGEMENT
Supplier Information Management Cycle Time LOWER IS BETTER 1.6 Business Hours
SUPPLIER AND THIRD-
Risk Management Evaluation Completion Rate HIGHER IS BETTER 82.6%
Risk Management Evaluation Cycle Time LOWER IS BETTER 37.4 Business Hours
Electronic Invoice Processing HIGHER IS BETTER 80.1%

INVOICING
Invoice Approval Cycle Time LOWER IS BETTER 11 Business Hours
First-Time Match Rate HIGHER IS BETTER 87.4%
Expense Report Approval Cycle Time LOWER IS BETTER 6.5 Business Hours
EXPENSES
Expense Report Lines Within Policy HIGHER IS BETTER 98.0%
Invoices Paid Digitally HIGHER IS BETTER 86.1%

PAYMENTS
Suppliers Using Digital Payments HIGHER IS BETTER 85.2%
Payment Batch Approval Cycle Time LOWER IS BETTER 1.6 Business Hours

THE COUPA BSM BENCHMARK REPORT ABOUT COUPA
About Coupa
Coupa is the cloud-based Business Spend Management (BSM)
platform that unifies processes across supply chain, procurement,
and finance functions. Coupa empowers organizations around
the world to maximize value and operationalize purpose through
their business spend.
Coupa’s community of 2,500+ customers use the platform to

maximize the value of more than $3.3T of direct and indirect
spend to date.
To learn more about Coupa, visit www.coupa.com and follow

us on LinkedIn or Twitter.

2022-Coupa BSM Benchmark Report

Uploaded by

Copyright:

Available Formats

2022-Coupa BSM Benchmark Report

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

2022-Coupa BSM Benchmark Report

Uploaded by

Copyright:

Available Formats

THE 2022 BUSINESS SPEND MANAGEMENT (BSM)

United by the Power of Spend.............................................................................................................................................. 5

Environmental, Social, and Governance (ESG)................................................................................................................. 8

Supplier and Third-Party Risk Management..................................................................................................................... 20

Conclusion: United by the Power of Spend...................................................................................................................... 35

Why Community Data?

Insights from Community Data

6.3% 15.4% 6.5 Business $2M

Learn more about Community.ai

THE COUPA BSM BENCHMARK REPORT 3

20 KPIs for Business Spend Management

Spend With Contract Structured Spend On-Contract Primary Suppliers

Electronic PO Requisition-to- Services Procurement Pre-Approved Spend

Supplier and Third-Party Risk Management Invoicing

Expense Report Expense Report Invoices Suppliers Using Payment Batch

THE COUPA BSM BENCHMARK REPORT 4

United by the Power of Spend

“Business Spend Management allows us to have greater transparency and

—Zalando, German multinational fashion e-commerce company

SPEND IS THE FUEL OF BUSINESS

SMARTER SPENDING CAN HELP YOU OVERCOME TODAY’S BIGGEST CHALLENGES

Learn more about the power of spend

THE COUPA BSM BENCHMARK REPORT 5

DIGITAL TRANSFORMATION OF SPEND MANAGEMENT

WHY BSM WORKS

BSM maximizes value by:

OPTIMIZING IMPROVING OPERATIONAL REDUCING

THE COUPA BSM BENCHMARK REPORT 6

UNITED BY THE POWER OF SPEND

Ready to start your journey?

THE COUPA BSM BENCHMARK REPORT 7

“We have a more assertive and precise vision of

• Achieving ESG goals has become

• Those in procurement, finance, and

• Supplier diversity, in particular, is a

Learn more about Sustainable

THE COUPA BSM BENCHMARK REPORT

Spend With Diverse Suppliers

• Companies have set commitments to • Monitor diverse suppliers for risk

Learn more about working

THE COUPA BSM BENCHMARK REPORT 9

“Contract Lifecycle Management proved to be a big

—Sonic Automotive, American automotive retailer

• As a result of recent economic disruptions,

• Being able to deftly create, access,

Learn more about the connections

THE COUPA BSM BENCHMARK REPORT

Contract Management Cycle Time

8.1 Business Days

• Faster time to execute contracts also

THE COUPA BSM BENCHMARK REPORT 11

• Employees benefit from having more

THE COUPA BSM BENCHMARK REPORT 12

• Since payment terms are negotiated

THE COUPA BSM BENCHMARK REPORT 13

• Reducing tail suppliers (increasing • Use automation to free up sourcing

See how Australian Leisure and

THE COUPA BSM BENCHMARK REPORT 14