Lavante’s recent activities were covered this week by an industry expert.
Jason Busch of SpendMatters.com spent some time exploring the new Lavante/Basware partnership diving a little more deeply into why such a partnership would take shape. Astutely, Busch points out that neither firm has played at “superficial Barney deals” (read: “I love you, you love me”) which frequently dot the partnership landscape. So why should these two groups, which may seem to have otherwise disparate backgrounds come together?
From his review of the deal announcement, Busch quickly connect dots, and highlights a marquee quote from the release, “the combination of Basware’s enterprise purchase-to-pay solutions and Lavante’s suite of Supplier Information Management (SIM) tools will enable Fortune 1000 companies to drive efficiencies throughout the purchase-to-pay process and maximize their return on investment.” If I may add a little more self-serving color around this quote… For years, Lavante has delivered vendor file management in tandem with its flagship supplier recovery services and has recently expanded vendor file processing into ongoing on-demand SIM. Basware customers, attempting to install enterprise-wide P2P solutions are often gated by poor quality of their resident supplier data and there really is no quick fix for this dilemma. Although a supplier cleanse project can prove helpful to improve data quality in the short term, that information begins to deteriorate rapidly. Lavante benchmarking demonstrates that at least 50% of suppliers will change some relevant attribute on an annual basis and the Institute of Management Accounting estimates that up to 7% of companies annually change their name. Long story short: Lots of constant change. The solution to this constant data drift may start with a project, but truly requires an ongoing process to sustain the data quality, and that is where Lavante SIM comes into play and provides that ongoing quality (as well as many other services).
Another of Busch’s accurate observations (which was not mentioned as directly in the release) is how Basware can leverage Lavante’s recovery services to decrease the barriers of entry for clients that run into budget difficulties. Busch writes, “Lavante can serve as a means to generate the working capital to fund investments in invoice automation solutions such as Basware.” For years Lavante has refined its platform for communicating with and driving compliance throughout a company’s vast vendor population. In that process, Lavante is able to perform a near-effortless review supplier AR ledgers. It is with this ongoing visibility that Lavante is able to unlock working capital from within the supply chain and return it back to the enterprise. These dollars which average about $600,000-$900,000 per $1Billion spent by an enterprise can quickly add up to millions of freed up working capital and can be applied to fund any number of investments in the P2P space and beyond.