Richard J. Palmer, Ph.D., C.P.A., C.M.A. Southeast Missouri State University. and. Mahendra Gupta, Ph.D., Washington University in St.

Transcription

1 RPMG RESEARCH CORPORATION S 2018 ELECTRONIC ACCOUNTS PAYABLE BENCHMARK SURVEY by Richard J. Palmer, Ph.D., C.P.A., C.M.A. Southeast Missouri State University and Mahendra Gupta, Ph.D., Washington University in St. Louis January , Richard Palmer and Mahendra Gupta 1

2 2018 ELECTRONIC ACCOUNTS PAYABLE BENCHMARK SURVEY TABLE OF CONTENTS Section Title Page # Introduction Confidentiality Agreement and Consent to Use Demographic Data EAP Program Description Supplier Enablement and Retention Capture and Payment Preferences EAP Purchase Activity and Impact on Other Payment Methods EAP Category Spending Capture Past Changes in EAP Spending Expected Changes in EAP Spending Value and Benefits of EAP Integration Program Management Mobile Technology, Blockchain, and E-Procurement Global EAP Payments EAP and Fraud EAP Provider Selection and Interaction Satisfaction with EAP Provider About the Authors , Richard Palmer and Mahendra Gupta 2

3 Introduction Welcome to the 2018 Electronic Accounts Payable Benchmark Survey. The survey is designed to understand and advance the successful use of Electronic Accounts Payable (EAP or virtual cards). Eighteen major financial institutions in the U.S. and Canada, as well as the National Association of Purchasing Card Professionals are supporting and participating in this study. There is no charge for participation. A strict confidentiality agreement is enforced and included on the next page. BENEFITS OF PARTICIPATION In recognition of your contribution of time and effort, organizations completing this survey will receive free of charge the following: 1. A PDF copy of the 2018 Electronic Accounts Payable Benchmark Survey Results, will be sent on completion of the survey. 2. A PDF copy of the 2015 Electronic Accounts Payable Benchmark Survey Results downloadable immediately upon completion of this survey. 3. The first 400 respondents who complete the survey will also be awarded with an Amazon.com gift certificate ($100 for the first 50, $50 for the next 100, and $25 for the next 250). The 2018 Results will include current market information and expert analyses that will provide your organization with: o Benchmark norms that will support a "segment-specific" self-assessment of performance and rationalize dialogues about financial incentives, o "Best practice" insights and customer commentary to assist in the development of strategies to optimize spending and derive the greatest value from EAP, o Market trend information to add depth in the case to top management about the benefits of EAP, and o Information that assists in the "day-to-day" management of administrative activities and control choices associated with EAP IMPORTANT SURVEY INSTRUCTIONS This survey is an in-depth examination of how organizations use and involve EAP in the procure-to-pay process. Participants will derive the greatest benefit if all questions are answered. Most questions can be answered by the EAP program administrator with simple selections or by providing common statistics. With the exception of a few required questions, if any question does not apply to your organization or if the answer is unavailable for any reason, simply leave the item blank. Completion of the survey should take approximately minutes, depending on information availability. If you have any questions about the survey, contact Professor Richard Palmer by (richard.palmer@rpmgresearch.net) or phone ( ). Please mail this completed survey to: RPMG Research Corporation 1616 West Main Street Suite 502 Marion, IL , Richard Palmer and Mahendra Gupta 3

4 Confidentiality Agreement and Consent to Use RPMG Research Corporation maintains a policy of strict confidentiality with respect to your responses to this survey. RPMG Research Corporation, its employees and agents, shall keep all individual responses to the 2018 Electronic Accounts Payable Benchmark Survey confidential and shall not disclose the responses to any person or other entity. In addition, all information, analysis, responses, and other data that is specific to or identifies a specific EAP provider shall be kept confidential and only released to that specific provider. This confidentiality agreement will apply to any person in the employment of or assisting RPMG Research Corporation in the analysis of survey data or compilation of survey results. Notwithstanding the fact that individual responses are and shall remain confidential, the aggregated responses of survey participants shall be made public in benchmark results, professional presentations, and published and unpublished documents authored by RPMG Research Corporation personnel bound by this agreement. By providing responses to this survey, you agree to allow RPMG Research Corporation to combine your response with others to create survey reports, presentations, and other analyses that describe best use and value delivered by Electronic Accounts Payable. (Required) Agree Do Not Agree Note: Without consent, you may not participate in the survey. If you would like to obtain more information about the survey or our benchmark reports, please contact Professor Richard Palmer by (richard.palmer@rpmgresearch.net) or phone ( ). Please note: The 2018 Electronic Accounts Payable Benchmark Survey, including questions and other content herein, is the copyrighted work of Richard Palmer and Mahendra Gupta of RPMG Research Corporation. Any use or duplication of the questions or content of this survey without the express written consent of the authors will be a violation of United States copyright law. 2018, Richard Palmer and Mahendra Gupta 4

5 SECTION 1: Demographic Data Introductory Note: Throughout this survey, we will inquire about your organization s use of Electronic Accounts Payable (EAP). We define EAP as any non-plastic commercial card account with a dynamically-adjustable credit limit assigned to match the amount of each transaction. It is typically used in the process to pay for goods and services after an invoice has been received. There is no limit to the type of goods or services that may be paid in this manner (including, but not limited to office supplies, computers, equipment, inventory, business services, travel, etc.). EAP may be referred to as virtual cards, epayables, single-use accounts, virtual payables, buyer-initiated payments, straight-through processing, or other similar terms. Traditional ghost card accounts (with preset fixed credit limits) are not considered EAP. 1. Does your organization use electronic accounts payable (EAP) to pay suppliers? (Required) Yes No If you answered No, please see message below. Otherwise, continue with Question 2(a). Due to your organization s lack of EAP use, this is the end of your survey. If you would like to obtain more information about the survey or our other commercial card benchmark reports, please contact Professor Richard Palmer by (Richard.Palmer@RPMGresearch.net) or phone ( ). 2(a). Information about the person responsible for completion of the survey: Name: Job Title: Phone number: ( ) - Extension (if applicable): 2(b). Your organization-assigned address (Required)*: * In order to receive the free PDF copy of the 2018 Electronic Accounts Payable Benchmark Survey Results and early response gift certificates (if applicable), you must provide your address at your organization. Personal addresses will not be accepted. 2(c). Would you like to be notified about future RPMG commercial card surveys and reports? Yes No 3(a). Information about your organization: Organization name: City: State, province, or territory: Country: United States Canada Other For Other, please see message below, and then continue on. Otherwise, skip to Question 3(b). A note on currency: This survey asks questions related to EAP spending, controls, and organizational revenue in U.S. dollars. As a matter of uniformity and to ensure quality data, please adjust your organization s figures to its equivalent in U.S. dollars. 2018, Richard Palmer and Mahendra Gupta 5

6 3(b). What is the name of the primary bank or financial institution that provides your organization with most or all of its EAP products? American Express Fifth Third Bank Synovus Bank of America Merrill Lynch First National Bank of Omaha TD Bank Barclays HSBC UMB BBVA Compass JPMorgan Chase Union Bank BMO Harris Bank Lloyds Bank US Bank BNP Paribas PNC Bank US Bank Canada Capital One Regions Bank Wells Fargo Citibank Scotiabank WEX Comdata Silicon Valley Bank Zions Bank Commerce Bank SunTrust Bank Other (please name): 3(c). Identify the brand associated with the primary EAP product used by your organization (select one): American Express Visa MasterCard Other (please identify): 3(d). Does your organization use any additional EAP providers other than the primary provider selected above? Yes (please identify): No 4. Please select the best description of your organization (please select one): (Required) Public corporation Privately-owned corporation Public college or university Private college or university School district State/province or state/provincial government agency City/county or city/county government agency Federal government agency Not-for-profit organization Other (please describe): If you chose public corporation, privately-owned corporation, or other, please answer Questions 4(a) and 4(b) on the next page; otherwise skip to Question , Richard Palmer and Mahendra Gupta 6

7 4(a). 4(b). Please select the best description of your company s geographic footprint. A North American company with all operations and sales in North America A North American company with operations and sales to customers outside of North America A non-north American company with operations and sales in North America A non-north American company with all operations and sales outside of North America Other (please describe): Please select the one industry classification that best describes your company: Administrative and support services Advertising and marketing Agriculture, forestry, and fishing Arts and entertainment Automotive retailing and service Construction Educational services Finance, insurance, and banking Food service and restaurants Hospitals Lodging and hospitality Management of facilities/companies Manufacturing Mining, oil and gas extraction, pipeline, and refining services Pharmaceuticals Publishing and media Professional, scientific, and technical services Real estate, rental, and leasing services Social services Software and information technology Telecommunications and data processing services Transportation Tourism and leisure Utilities (gas, electrical, and water) Warehousing and distribution services Wholesale and retail trade Other (please describe): 5. Please provide a brief description of your organization s business activities and/or primary product/service: 6. Please provide the number of employees at your organization: (Required),, 7. What is your organization s approximate annual revenue (or budget for governmental and not-forprofit entities) for the last complete year? (Required) Less than $1 million $1 million to $9.9 million $10 million to $24.9 million $25 million to $99.9 million $100 million to $299.9 million $300 million to $499.9 million $500 million to $999 million $1 billion to $1.9 billion $2 billion to $4.9 billion $5 billion to $9.9 billion $10 billion to $20 billion Greater than $20 billion Not sure 2018, Richard Palmer and Mahendra Gupta 7

8 SECTION 2: EAP Program Description 8. Please identify the types of EAP platforms used by your organization. (A response to each platform is required) Common Types of EAP Platforms Virtual accounts maintained by supplier Description of Platform Does Your EAP Program Include this Platform? Fixed account number assigned to a specific supplier and held in trust by that supplier, who charges the account to receive payment for approved invoices. Yes No Fixed account number is assigned to a specific supplier, but not held by that supplier. The account number is transmitted to and charged by the supplier at time of payment. Yes No Randomly generated account number is transmitted to and charged by the supplier at the time of payment. Yes No Card account is charged on behalf of the supplier, resulting in funds being deposited in the supplier s bank account. Suppliers do not initiate the transaction or input card data. Yes No Virtual accounts maintained by buyer Single-use or rotating pool of accounts Buyer-initiated payments or straightthrough processing Other (please describe below if used) Yes No Please describe your organization s other EAP platform if selected above: 9. Average monthly spending on EAP (all platforms combined) currently is: (Required)* $,, Average number of monthly transactions on EAP (all platforms combined) currently is: (Required)*,, * If the most recent month of EAP activity is not representative of your typical activity, please report your spending and number of transactions for an average month , Richard Palmer and Mahendra Gupta 8

9 11(a). Please provide the percentage of combined monthly EAP spending that is conducted on each of the EAP platforms below. Type of EAP Platform Percentage of Combined Monthly EAP Spending on Platform Virtual accounts maintained by supplier % Virtual accounts maintained by buyer % Single-use or rotating pool of accounts % Buyer-initiated payments or straight-through processing % Other % TOTAL (should sum to 100%) 100% 11(b). Please select the dollar range that best represents the average transaction amount for each EAP platform. If a platform is not used, please select N/A. Average Transaction Amount Virtual accounts maintained by supplier Virtual accounts maintained by buyer Singleuse or rotating pool of accounts Buyer-initiated payments or straight-through processing Other N/A (platform is not used) $1 to $1,000 $1,001 to $2,000 $2,001 to $3,000 $3,001 to $4,000 $4,001 to $5,000 $5,001 to $6,000 $6,001 to $7,000 $7,001 to $8,000 $8,001 to $9,000 $9,001 to $10,000 $10,001 to $15,000 $15,001 to $20,000 $20,001 to $40,000 Greater than $40, Please select the answer that best completes the sentence: Compared to purchases my organization makes with plastic cards, EAP purchases are for goods and services of the same type and dollar amount goods and services that are different N/A; my organization does not use plastic cards For goods and services that are different, please answer Question 12(a). Otherwise, skip to Question , Richard Palmer and Mahendra Gupta 9

10 12(a). Please describe how purchases via EAP differ from purchases via plastic cards (select all that apply) Compared to purchases my organization makes with plastic cards, EAP purchases are for goods and services of higher dollar values for purchases from suppliers with whom the organization conducts a high number of transactions for goods and services which are not allowed to be paid by plastic cards for transactions requiring additional approvals or controls prior to payment different in other ways (please describe): 13. What is the largest single transaction paid by any EAP platform at your organization in the past year? $10,000 or less $200,001 to $300,000 $10,001 to $50,000 $300,001 to $500,000 $50,001 to $100,000 $500,001 to $1,000,000 $100,001 to $200,000 More than $1,000,000 (please specify): $ 14. How long has your organization been using EAP? Less than one year 3-4 years 7-8 years years 1-2 years 5-6 years 9-10 years 13 years or more 15. Does your organization use EAP to its full potential? Yes No For No, please answer 15(a). Otherwise skip to (a). Please select the answer that best completes the sentence: EAP spending at my organization would be if we used EAP to its full potential. 50% higher 4-5 times higher 8-9 times higher times higher 2-3 times higher 6-7 times higher times higher more than 15 times higher 16. Does your organization s use of EAP occur within an integrated payables solution where the bank or EAP provider enables payments to suppliers through multiple payment channels, based on rules reflecting your organization s preferences? Yes No For No, please answer 16(a). Otherwise skip to (a). Does your organization plan to use an integrated payables solution in the next three years? Yes No 2018, Richard Palmer and Mahendra Gupta 10

11 17. Please rate the degree to which EAP has been valuable in delivering outcomes to your organization. Outcome Value of EAP in Delivering Outcome Where: 1=Not valuable 2=Slightly valuable 3=Moderately valuable 4=Very valuable 5=Extremely valuable Enhance financial position (e.g., improve working capital/cash flow, obtain rebates, obtain early payment discounts, avoid late fees, etc.) Reduce reliance on checks Improve organizational processes (e.g., increase administrative efficiency, simplify spend reconciliation process, improve integration with accounting systems, etc.) Increase spending transparency (e.g., improve payment tracking, obtain data not consistently provided by other payment methods, consolidate spending across multiple units/systems, etc.) Enhance cybersecurity Strengthen control over spending (e.g., reduce potential for waste or abuse) , Richard Palmer and Mahendra Gupta 11

12 SECTION 3: Supplier Enablement and Retention 18. Approximately how many suppliers does your organization currently pay with EAP? Less than to to to to 250 More than to to 400 (please specify): 19. Please estimate the percentage of your organization s supplier base that currently accepts EAP. % 20. Who conducts most of the key steps to enable and maintain supplier acceptance of EAP? (select one) Members of my organization Bank or EAP provider 3 rd party service provider (please identify): Neither my organization nor our EAP provider (or 3 rd party) is very involved in enrolling suppliers to accept EAP Other (please describe): 21. In the last year, how many of your organization s suppliers have: (a). begun accepting EAP: (b). stopped accepting EAP:,, If Question 21(b) is greater than 0, answer Question 21(b)(1). Otherwise, go to Question 22(a). 21(b)(1). Which answer best describes your organization s most frequent response to suppliers that stop or request to stop accepting EAP? No response is made We engage with the supplier We inform our EAP provider of the supplier s request and allow them to address Other (please describe): 2018, Richard Palmer and Mahendra Gupta 12

13 22(a). What actions does your organization take to support enrolling and maintaining the EAP-accepting supplier base? To enroll and maintain the EAP-accepting supplier base, does your organization Does your organization engage in activity? (1). Directly contact suppliers to inform them of the EAP program? Yes No (2.) Have a clear EAP acceptance on-boarding process for new suppliers? Yes No (3). Have a process in place for suppliers to self-enroll for acceptance of EAP? Yes No (4). Have senior leadership reach out to suppliers directly? Yes No (5). Target suppliers based on fit for EAP (e.g., high transaction volume)? Yes No (6). Include a requirement to accept EAP in RFPs or at renewal of supplier contracts? Yes No (7). Help suppliers seek and obtain lower interchange rates for large-ticket purchases? Yes No (8). Provide internal incentives to employees who successfully enlist suppliers? Yes No (9). Integrate EAP in a dynamic discounting payment strategy (where suppliers have input into the method, terms, and timing of payment)? Yes No (10). Have standard terms that differ across different payment methods? Yes No (11). Offer faster payment with EAP to encourage acceptance (e.g., pay immediately upon invoice receipt)? Yes No (12). Extend payment terms for non-eap payment methods (e.g., pay at 60 days instead of 30)? Yes No (13). Revisit discussions with suppliers that initially refuse EAP payment at least annually? Yes No 22(b). Which action by your organization has been most effective in on-boarding and maintaining supplier acceptance of EAP? (Please identify the line number from the question above, or describe any action not listed) 23. Other things being equal (e.g., product quality, price), how often does your organization direct purchases to a supplier that accepts EAP over a non-accepting supplier? Very frequently Frequently Occasionally Rarely Very rarely Never 24. How frequently does your organization change suppliers due to a lack of EAP acceptance? Very frequently Frequently Occasionally Rarely Very rarely Never 25. If all of your suppliers accepted EAP payment, by how much would your organization s monthly EAP spending increase? Less than 10% 26% to 50% 101% to 200% More than quadruple 10% to 25% 51% to 100% 201% to 400% Not sure 26. Overall, how satisfied is your organization with the current level of supplier acceptance for EAP payment? Very satisfied Satisfied Neutral Dissatisfied Very dissatisfied 2018, Richard Palmer and Mahendra Gupta 13

14 SECTION 4: Capture and Payment Preferences 27. Please estimate the percentage of all transactions within certain dollar ranges currently paid by the payment methods specified below. If you are unsure about the breakdown for each payment method and a reasonable estimate cannot be made, please continue with the next question. Otherwise, each column should sum to 100%. Payment Method Percentage of All Transactions $2,500 or Less Paid by Percentage of All Transactions $2,501 to $10,000 Paid by Percentage of All Transactions $10,001 to $100,000 Paid by Percentage of All Transactions $100,001 to $1 million Paid by Electronic accounts payable % % % % Other types of card accounts (e.g., p-cards, travel, prepaid, fleet) % % % % Paper checks % % % % Same day automated clearing house (ACH) transfers % % % % Standard automated clearing house (ACH) transfers % % % % Wire transfers % % % % Other method % % % % TOTAL (should sum to 100%) 100% 100% 100% 100% 28. How often does your organization examine its payment activity to identify areas of opportunity for increased EAP spending? Monthly Quarterly Semi-annually Annually N/A My organization does not conduct this type of analysis 2018, Richard Palmer and Mahendra Gupta 14

15 29. Between EAP, checks, and ACH, please choose the payment method that best meets your organization s criteria listed below. Select the payment method that best meets the criteria Criteria for Payment Method EAP Checks ACH Security and Control Security of payment Ability to control spending Supplier Issues Acceptance of payment method in the U.S. and Canada Global acceptance of payment method Ease of setting up supplier to accept payment Supplier preference for payment method Minimization of activities to support extension of credit by supplier Ability to resolve disputes about payment Ease with which refunds/returns can be processed Cost and Incentives Technology investment required Training requirements Per-transaction charges Bank fees (other than per-transaction costs) Incentives/rebates for use Ability to control timing of settlement Information and Data Integration Ability to cost-effectively transmit remittance information to supplier Ability to integrate payment information into accounting/erp software Ability to track supplier receipt of payment Ease of payment reconciliation Quality and Cycle Time Minimized likelihood of errors, corrections, or rework to complete payment Quickest method to transmit payment Frequency of Purchase Ability to support low volume purchase activity with supplier Ability to support high volume purchase activity with supplier 2018, Richard Palmer and Mahendra Gupta 15

16 SECTION 5: EAP Purchase Activity and Impact on Other Payment Methods 30. In an earlier response, you indicated that your monthly EAP spending is $[Q9]. Please breakdown that spending among each of the good and service categories listed below, based on an average month. If you do not typically conduct spending in a given category, please leave the row blank. Please note: The column total will automatically sum for you, and should equal $[Q9]. Category of Purchases Catering/cafeteria/food service Computer/mobile hardware, software, and peripherals Capital assets (depreciable asset purchases other than office equipment, computers, software, construction materials, or infrastructure) Contractual repair and maintenance (e.g., contractor services) Education and training Construction materials and infrastructure (e.g., buildings, roads, bridges, pipelines, etc.) Insurance Inventory Lease and rental payments Mail delivery Media and advertising Office equipment and supplies (e.g., desks, stationary, toner, etc.) Operating goods and supplies (e.g., general maintenance, industrial, lab, or shop supplies, uniforms, fuel, tools, and other goods) Printing and duplication Professional services (e.g., engineering, architectural, legal, accounting, medical, consulting) Telecommunication services Temporary help Transportation (delivery of goods) Travel and travel-related expenses (e.g., lodging, airfare, auto rental, etc.) Utilities (water, sewer, electric, gas) Other goods (please describe): Other services (please describe): TOTAL Of Your Average Monthly EAP Spending, How Much Was Within This Category? (Note: Your answers in the column should sum to your total reported monthly spending of $[Q9]) $[Q9] 31. Has your organization stopped or significantly decreased its use of EAP to pay for any good or service category in the past year? If Yes, please answer Question 31(a). Otherwise, go to Question 32. Yes No 2018, Richard Palmer and Mahendra Gupta 16

17 31(a). What good or service category is no longer paid with EAP or has had EAP payments significantly reduced? Why were EAP payments stopped or significantly reduced? 32. How has spending on each of the following payment methods changed since your organization s adoption of EAP? Other Payment Method Plastic purchasing cards Plastic travel cards Ghost or lodged card accounts Other plastic cards (e.g., fleet, meeting) Checks ACH Change in Other Payment Method Spending Since the Adoption of EAP Increased No impact Decreased Do not use Increased No impact Decreased Do not use Increased No impact Decreased Do not use Increased No impact Decreased Do not use Increased No impact Decreased Do not use Increased No impact Decreased Do not use 33(a). Does EAP support travel bookings and payments made through a travel agency (internal or external) or Travel Management Company (TMC)? Yes No 33(b). What challenges has your organization experienced when using EAP to pay for travel expenses? (please select all that apply) Processing refunds when travel plans are changed or cancelled Communicating virtual card information in a secure manner Reservation holds denied against the virtual card s specific available credit Lack of EAP acceptance from certain travel service providers Additional steps (such as authorization forms) required to complete the transaction Poor employee training for EAP acceptance by travel provider(s) Processing of additional charges (e.g., hotel incidentals) Other (please describe): No challenges experienced My organization does not use EAP for travel expenses 2018, Richard Palmer and Mahendra Gupta 17

18 SECTION 6: EAP Category Spending Capture 34. Please indicate (a) the percentage of total spending in each category that is currently being paid with EAP, and (b) whether your organization believes EAP spending will increase in each category over the next 3 years. NOTE: Answers for each row are independent and the column should not sum to 100%. For example, 2015 survey respondents indicated 22% of total spending for computer purchases were paid with EAP. If no spending in the category was paid by EAP, simply leave the row blank. (A) Percentage of Total Spending in This Category Currently Paid by EAP (Note: each row is independent and can range from 0% to 100%) (B) Will EAP Spending in This Category Increase in the Next 3 Years? Category of Purchases Catering/cafeteria/food service % Yes No Computer/mobile hardware, software, and peripherals % Yes No Capital assets (depreciable asset purchases other than office equipment, computers, software, construction materials, or infrastructure) % Yes No Contractual repair and maintenance (e.g., contractor services) % Yes No Education and training % Yes No Construction materials and infrastructure (e.g., buildings, roads, bridges, pipelines, etc.) % Yes No Insurance % Yes No Inventory % Yes No Lease and rental payments % Yes No Mail delivery % Yes No Media and advertising % Yes No Office equipment and supplies (e.g., desks, stationary, toner, etc.) % Yes No Operating goods and supplies (e.g., general maintenance, industrial, lab, or shop supplies, uniforms, fuel, tools, and other goods) % Yes No Printing and duplication % Yes No Professional services (e.g., engineering, architectural, legal, accounting, medical, consulting) % Yes No Telecommunication services % Yes No Temporary help % Yes No Transportation (delivery of goods) % Yes No Travel and travel-related expenses (e.g., lodging, airfare, auto rental, etc.) % Yes No Utilities (water, sewer, electric, gas) % Yes No Other goods % Yes No Other services % Yes No 2018, Richard Palmer and Mahendra Gupta 18

19 SECTION 7: Past Changes in EAP Spending 35. In comparison to your average monthly spending in the year 2015, overall EAP spending (all platforms) at your organization has: Increased Stayed the same Decreased N/A; my organization did not use EAP in 2015 For Increased, please answer Question 35(a) before proceeding to Question 36. For Decreased, please answer Question 35(b) before proceeding to Question 36. For Stayed the same or N/A, go directly to Question (a). Please indicate (by one selection) the average annual growth rate in EAP spending at your organization over the three-year period from 2015 to Average Annual Increase in Electronic Accounts Payable Spending over the 3 Year Period from 2015 to 2017 Less than 1% per year 7% to 8% per year 16% to 20% per year 41% to 50% per year 1% to 2% per year 9% to 10% per year 21% to 25% per year 51% to 75% per year 3% to 4% per year 11% to 12% per year 26% to 30% per year 76% to 100% per year* 5% to 6% per year 13% to 15% per year 31% to 40% per year More than 100% per year * For example, a 100% increase indicates that spending has doubled that of the previous year. Please continue the survey with Question (b). Please indicate (by one selection) the average annual rate of decline in EAP spending at your organization over the three-year period from 2015 to Average Annual Decrease in Electronic Accounts Payable Spending over the 3 Year Period from 2015 to 2017 Less than 1% per year 7% to 8% per year 16% to 20% per year 41% to 50% per year # 1% to 2% per year 9% to 10% per year 21% to 25% per year More than 50% per year 3% to 4% per year 11% to 12% per year 26% to 30% per year 5% to 6% per year 13% to 15% per year 31% to 40% per year # For example, a 50% decrease indicates that spending was one-half the level of the previous year. Please continue the survey with Question , Richard Palmer and Mahendra Gupta 19

20 SECTION 8: Expected Changes in EAP Spending 36. Please identify the expected change in overall EAP spending at your organization over the next five years (2018 through 2022): Increase Stay the same Decrease For Increase, please answer Questions 36(a) and 36(b), followed by Question 37. For Decrease, please answer Questions 36(c) and 36(d), followed by Question 37. Otherwise, go directly to Question (a). Please identify the three most important reasons for expecting an increase in overall EAP spending at your organization over the next five years. My organization expects increased spending due to: an increase in overall company revenue (or budget) efforts to target commodities for EAP payment additional good and service categories that can be paid with EAP (please specify): efforts to target high-dollar transactions greater acceptance of EAP by suppliers changes in organizational incentives for EAP use enactment or improved enforcement of policies requiring EAP payment other (please describe): 36(b). Please indicate (by one selection) the expected average percentage increase per year in overall EAP spending over the next five years (ending December 2022). Expected Average Increase per Year in EAP Spending for the Next 5 Years (Ending December 2022) (select one) Less than 1% per year 7% to 8% per year 16% to 20% per year 41% to 50% per year 1% to 2% per year 9% to 10% per year 21% to 25% per year 51% to 75% per year 3% to 4% per year 11% to 12% per year 26% to 30% per year 76% to 100% per year* 5% to 6% per year 13% to 15% per year 31% to 40% per year More than 100% per year * For example, a 100% increase indicates that spending is expected to double the previous year s spending each year. Please continue the survey with Question , Richard Palmer and Mahendra Gupta 20

21 36(c). Please identify the primary rationale for expecting a decrease in your organization s overall EAP spending over the next five years. My organization expects decreased spending due to: a decrease in overall company revenue (or budget) reduced supplier acceptance of EAP surcharges added to goods and services by suppliers for EAP payment greater use of another payment method (please identify): dissatisfaction with the EAP program other (please describe): 36(d). Please indicate (by one selection) the expected average percentage decrease per year in overall EAP spending over the next five years (ending December 2022) Expected Average Decrease per Year in EAP Spending for the Next 5 Years (Ending December 2022) (select one) Less than 1% per year 7% to 8% per year 16% to 20% per year 41% to 50% per year # 1% to 2% per year 9% to 10% per year 21% to 25% per year More than 50% per year 3% to 4% per year 11% to 12% per year 26% to 30% per year 5% to 6% per year 13% to 15% per year 31% to 40% per year # For example, a 50% decrease indicates that spending is expected to be one-half of the previous year s spending. 37. Please indicate the expected changes in spending across the different EAP platforms used by your organization. Type of EAP Platform Expected Change in Spending over the Next 5 Years Virtual account maintained by supplier Increase No change Decrease Do not use Virtual account maintained by buyer Increase No change Decrease Do not use Single-use or rotating pool of accounts Increase No change Decrease Do not use Buyer-initiated payments or straightthrough processing Increase No change Decrease Do not use 2018, Richard Palmer and Mahendra Gupta 21

22 SECTION 9: Value and Benefits of EAP 38. Assume a transaction cost to pay an invoice includes the administrative (and labor) cost of activities including: (a) inputting data into accounting records, (b) creating payment instructions, (c) filing documents, (d) generating and transmitting payment, and (e) reconciling transaction with bank and accounting records. Please estimate the transaction cost at your organization to pay invoices by: (a). traditional paper check (b). EAP payment (c). ACH payment $.00 per transaction $.00 per transaction $.00 per transaction 39. Please select the answer that best completes the sentence: A bill from my EAP provider for EAP charges arrives every 1 day 15 days 30 days Other (please describe): 7 days 20 days 45 days 40. Payment to your EAP provider for EAP charges is due after the close of the billing cycle (i.e., the grace period) 1 day 10 days 20 days Other (please describe): 7 days 15 days 30 days 41. Has your organization received a rebate (or revenue share) from your provider for EAP spending in the past year? Yes No For Yes, please answer Questions 41(a) through 41(c). Otherwise, skip to Question (a). As a percentage of EAP spending, please identify the level of rebate nearest to that received by your organization in the past year. 0.10% or less 0.81% to 0.90% 1.61% to 1.70% 0.11% to 0.20% 0.91% to 1.00% 1.71% to 1.80% 0.21% to 0.30% 1.01% to 1.10% 1.81% to 1.90% 0.31% to 0.40% 1.11% to 1.20% 1.91% to 2.00% 0.41% to 0.50% 1.21% to 1.30% Greater than 2.00% 0.51% to 0.60% 1.31% to 1.40% (please specify): % 0.61% to 0.70% 1.41% to 1.50% Not sure 0.71% to 0.80% 1.51% to 1.60% 41(b). Does your organization pay its EAP provider early (by shortening or minimizing the grace period) in order to receive a larger rebate? Yes No 41(c). If your organization no longer received a rebate for EAP spending, how likely is it that your organization would continue to use and maintain its EAP program? Very likely Likely Neutral Unlikely Very unlikely 2018, Richard Palmer and Mahendra Gupta 22

23 42. What is the most common due date from your suppliers for invoices received? upon receipt of invoice 45 days from invoice date 15 days from invoice date 60 days from invoice date 30 days from invoice date other (please describe): 43. How soon after receipt of an invoice do you usually pay suppliers with EAP? immediately upon receipt 31 to 45 days 1 to 10 days on the invoice s due date 11 to 15 days other (please describe): 16 to 30 days 44. Does your organization capture all discounts made available by its suppliers? Yes No 45. Please select the answer that best completes the sentence: By paying with EAP, the dollar amount of early payment discounts my organization has been able to capture from suppliers has increased not changed decreased N/A; my organization is not typically offered early payment discounts 2018, Richard Palmer and Mahendra Gupta 23

24 SECTION 10: Integration 46. What percentage of your EAP transactions are manually reconciled by your organization? 0% (all EAP transactions are automatically reconciled) 1% to 10% 11% to 20% 21% to 30% 31% to 40% 41% to 50% More than 50% (please specify): % For 0%, please skip to Question 47. Otherwise, please answer Questions 46(a) and 46(b). 46(a). 46(b). What is the major reason that EAP transactions are not automatically reconciled by your organization? (select one) Supplier-initiated post-purchase transactions (e.g., refunds to the card number, charges for shipping unknown at time of purchase, charges that were not initially authorized such as hotel incidentals) Limitation inherent in our ERP/accounting software Audit or verification restrictions Other (please describe): Please rate the degree to which reconciliation of EAP spending is a problem. Not a problem Minor Moderate Major Other (please describe): 47. What type of Accounts Payable software does your organization utilize? Standalone accounting package (e.g., Sage, QuickBooks, M&D) An Enterprise Resource Planning package (e.g., SAP, Oracle, Microsoft Dynamics) that integrates key business areas such as planning, purchasing, inventory, sales, marketing, finance, and human resources An in-house constructed system Other (please describe): 48. Please complete the following statement with the best answer: My organization s EAP spending is integrated with our accounting information/erp system. 0% (EAP transactions are not at all integrated with the accounting/erp system) 1% to 20% 21% to 40% 41% to 60% 61% to 80% 81% to 99% 100% 49. Overall, how satisfied is your organization with its ability to integrate EAP spending data into its organizational accounting/erp system? Very satisfied Satisfied Neutral Dissatisfied Very dissatisfied 2018, Richard Palmer and Mahendra Gupta 24

25 SECTION 11: Program Management Note: For this survey, the term administrator is used to describe personnel who have primary responsibility for oversight and management of the EAP program. Please report information about EAP administrative time commitment on a full time equivalent (FTE) basis where, for example, two half-time workers equal one FTE worker or three half-time workers equal 1.5 FTE. 50. The current amount of administrator time dedicated to running the EAP program at my organization is: Less than 0.25 FTE 0.25 FTE (quarter-time) 0.50 FTE (half-time) 0.75 FTE (three-quarter-time) 1 FTE (one full-time person) 1.25 FTE 1.50 FTE 1.75 FTE 2 FTE More than 2 FTE (please specify): 51. Does your organization support program administrator attendance at user conferences to identify new ways to improve use of the EAP program? have an ongoing method of communicating information about the EAP program to the organization (e.g., information sessions, newsletters)? use a metric (e.g., spending or rebates received) to evaluate the performance of the EAP program? compare its EAP program spending to spending of similar organizations? have top management that fully support the use of EAP? have a policy mandating EAP use for certain purchases? internally audit and review the EAP spending approval process at least annually? have insurance from your EAP provider related to fraudulent EAP spending? Yes No Yes No Yes No Yes No Yes No Yes No Yes No Yes No 52. How does your organization s management team currently rate the EAP program s performance? Needs improvement Meets expectations Exceeds expectations Unknown; management has not evaluated the EAP program s performance If you answered Meets or Exceeds, please answer Question 52(a). Otherwise, skip to Question (a). Please identify your organization s most important best practices that contribute to its aboveaverage level of EAP performance. 53. Other than supplier acceptance, what is the most significant barrier limiting EAP use at your organization? 2018, Richard Palmer and Mahendra Gupta 25

26 SECTION 12: Mobile Technology, Blockchain, and E-Procurement 54. Does your organization transmit EAP (virtual card) numbers to mobile devices to authorize and make purchases? If you answered No, please answer Question 54(a). Otherwise, skip to Question (a). If the functionality was available, would your organization transmit EAP numbers to mobile devices to support employee purchases in the future? Yes Yes No No 55. Does your organization use blockchain technology in any of its business-to-business transactions?* Yes No * Note: A blockchain is a shared database that is managed by a global network of computers. Information held in the database is distributed and continually reconciled by the computers in the network. The computers are often referred to as nodes, miners, or peers. The computers create and maintain their blockchain by validating and transmitting entries. Entries are the data that is published by the users of the network. Common blockchain applications are smart contracts, asset registration, and cybercurrencies. For Yes, go to Question 55(a), then proceed to Question 56. For No, answer Question 55(b), then proceed with Question (a). Please provide us with an example of your organization s use of blockchain applications? Please continue the survey with Question (b). Does your organization plan to use blockchain technology in any business-tobusiness transactions in the next three years? Yes No Not Sure 56. Does your organization use EAP to pay for purchases made via e-procurement software?* * Note: e-procurement software is defined as any web-based software application that enables employees to purchase goods from approved electronic catalogs in accordance with agreed upon prices and company buying rules, while capturing necessary purchasing data in the process. The employee s selection of a good for purchase from a supplier catalog is automatically routed through the necessary approval processes and protocols. Yes No 2018, Richard Palmer and Mahendra Gupta 26

27 SECTION 13: Global EAP Payments 57. Do units of your organization inside the U.S. and Canada pay suppliers outside of the U.S. and Canada with EAP? Yes No N/A; my organization does not have U.S. or Canadian business units For Yes, please answer Questions 57(a) and 57(b). Otherwise, skip to Question (a). Approximately what percentage of your organization s EAP spending is paid to suppliers outside of the U.S. and Canada? Do not include spending conducted by units outside of the U.S. and Canada % 57(b). Please indicate whether your organization s U.S. and Canadian units use EAP to pay any suppliers within the regions listed. Region Africa Asia and Asia Pacific Australia Europe Mexico Middle East South and Central America, Caribbean Do your U.S./Canadian Units Use EAP to Pay Suppliers in this Geographic Region? Yes No Yes No Yes No Yes No Yes No Yes No Yes No 58. Does your organization have units located outside of the U.S. and Canada that use EAP to pay for goods and services in their local currency? Yes No 2018, Richard Palmer and Mahendra Gupta 27

28 SECTION 14: EAP and Fraud For purposes of this survey, fraud occurs when any unauthorized payment is made with EAP. Fraud can be broken down into two types: External Fraud: Unauthorized payments made by either a third party (e.g., internet hacker) or an unscrupulous supplier, or Internal Fraud: Payments made by an employee who is not authorized to use EAP. 59. Has your organization experienced any incident of fraudulent EAP use in the past year? (Important note: for this question, an incident is defined as an event that resulted in an internal organizational record of what occurred) Yes No If you answered Yes, please answer Question 59(a). If you answered No, skip to Question (a). Please provide (1) the number of incidents of fraud that resulted in an internal record of the event, and (2) the total dollar loss to your organization associated with those incidents. Please exclude any monetary loss that was absorbed by your EAP provider. Type of Fraudulent Spending (1) Number of Incidents in Past Year That Resulted in an Internal Record (2) Total Dollar Loss to the Organization Associated with Fraudulent Spending Unauthorized payments made by either a third party (e.g., internet hacker) or an unscrupulous supplier $.00 Payments by an employee not authorized to use EAP $.00 Other $.00 If you selected Other above, please provide a brief description: 60. Please complete the following statement by selecting the most appropriate response: In comparison to other payment methods, EAP spending at my organization is associated with a likelihood of fraudulent spending. significantly lower similar significantly higher 2018, Richard Palmer and Mahendra Gupta 28

29 SECTION 15: EAP Provider Selection and Interaction 61. Please identify the top three reasons for your organization s choice of EAP provider: Rebates and other financial incentives Competitive fee structure Expansion of an existing banking relationship Features/functionality of EAP technology Experience/market leadership The attractiveness of overall suite of Treasury payment products and technology Supplier enablement support Other (please describe): 62. How often does your organization communicate with your EAP provider s account manager (via phone call, site visit, , etc.)? Daily Monthly Semi-annually Other time frame (please specify): Weekly Quarterly Annually 63. How satisfied is your organization with the performance of your EAP provider s account manager? Very satisfied Satisfied Neutral Dissatisfied Very dissatisfied 64. Would you recommend your current EAP provider to other organizations for their EAP technology? Yes No 65. Is your organization currently considering switching its EAP provider? Yes No For Yes, please answer Question 65(a). For No, skip to Question (a). Briefly discuss the key reason(s) your organization is considering switching its EAP provider. 2018, Richard Palmer and Mahendra Gupta 29

30 SECTION 16: Satisfaction with EAP Provider 66. Please rate the importance of and satisfaction with the economic elements associated with EAP. Importance of Economic Element to Your Organization Not Important Very Important Satisfaction with Your EAP Provider on Economic Element Very Dissatisfied Bank fees associated with EAP Rebates/incentives tied to EAP spending Liability protection from fraudulent EAP use Large-dollar transaction costs to suppliers Late payment fees Foreign exchange fees Overall economic relationship with EAP provider Very Satisfied 67. Please rate the importance of and satisfaction with the elements of customer service and support supplied to your organization by your EAP provider. Importance of Service and Support Element to Your Organization Not Important Very Important Satisfaction with Your EAP Provider on Service and Support Element Very Dissatisfied Training materials and support Knowledge of the organization's purchasing/payables software and business process Friendliness and respect shown by EAP provider support personnel Assistance identifying best applications for EAP Service and support in EAP implementation Quality of help from help desk Hours of help desk availability Average time elapsed for help desk to resolve a problem Handling of disputed transactions Sponsorship of EAP "user conferences" or other training programs Support in development of EAP spending reports Overall customer service and support Very Satisfied 2018, Richard Palmer and Mahendra Gupta 30