As Procurement teams are tasked to do more with less in an increasingly complex and uncertain market, digitization has become a must.
Procurement leaders have increasingly turned to Spend and Supplier Management platforms to improve decision-making, efficiency and collaboration. Vendors naturally make promises on the speed and level of value realized from their platforms, but 3rd party validation and actual results from past projects is needed to validate such claims and better build your own business case..
Ivalua commissioned Forrester Consulting to conduct a Total Economic Impact™ (TEI) study, offering key insights into how companies can unlock substantial financial benefits and operational improvements by adopting Ivalua’s unified Source-to-Pay (S2P) platform.
Below, we’ll explore what TEI entails, the key findings of the Ivalua TEI report, and how Ivalua drives value through improved Procurement and accounts payable efficiency, supplier management improvements, and cost reduction.
Key Takeaways
- Total Economic Impact (TEI) is a Forrester framework to evaluate the costs, benefits, and risks of specific technology investments based on actual results delivered across a vendor’s customers.
- TEI helps organizations measure ROI, NPV, and efficiency gains from implementing solutions like Ivalua’s Source-to-Pay (S2P) platform.
- 393% ROI from process automation, better visibility, and replacing old systems.
- $25.5M NPV generated over three years for a typical organization.
- Reductions in operational overhead and improved supplier engagement.
What is Total Economic Impact?
Total Economic Impact™ (TEI) is a framework developed by Forrester to analyze the financial implications of technology investments. It provides a comprehensive evaluation of costs, benefits, and risks specific to adopting a specific solution, helping organizations make informed, data-driven decisions.
For businesses seeking to modernize procurement processes, TEI serves as a valuable tool to compare competing solutions and the benefits likely to be achieved from each.
By quantifying the financial and operational impact of Ivalua’s solution and understanding the qualitative benefits, the TEI study is a useful tool for selecting a provider and building a realistic business case.
Key Findings of the Ivalua TEI Report
The TEI study paints a compelling picture of the value customers can expect to achieve from Ivalua’s platform:
- 393% Return on Investment (ROI) achieved through process automation, cost reduction, visibility improvements, and legacy system consolidation.
- Payback in under 6 months.
- $25.5M Net Present Value (NPV) generated over three years for the composite organization studied.
- Reductions in procurement overhead, coupled with increased spend visibility, innovation opportunities, and streamlined supplier engagement.
- Non quantified benefits including improved ESG performance, risk, compliance and overall visibility with a single source of truth from Ivalua’s “Golden Supplier Record.”
- Improved agility to support organizational growth and changes.
These results are more than just statistics. They underscore Ivalua’s ability to transform procurement from a cost center into a strategic growth engine. And they explain why Ivalua has maintained a customer retention rate of 95-100% for over 20 years.
Unlocking Value Across Business Functions
By standardizing processes and automating workflows, Ivalua makes procurement more efficient while enabling organizations to focus on strategic initiatives. Below are key areas where Ivalua delivers measurable impact.
Procurement Efficiency Savings
Before implementing Ivalua, organizations interviewed by Forrester typically managed procurement through multiple fragmented systems. These disjointed processes introduced inefficiencies, increased human errors, and limited visibility into spend. Ivalua centralizes operations and delivers end-to-end visibility, allowing for better decision-making and improved compliance.
Savings Achieved: Over $24.2 million in procurement efficiencies over three years.
Business Impact:
- Automation of sourcing and contracting tasks, cutting cycle times by as much as 40%.
- Overall procurement and AP operating cost reductions of 20-30% from higher automation.
- Increased procurement cost savings ranging between 2.25% and 2.35% annually.
- Elimination of manual data-cleaning tasks, giving teams more time for strategic endeavors.
How to Gain Similar ROI:
- Centralize supplier data and use analytics software to identify cost-saving opportunities.
- Transition from email-based or manual workflows to automated procurement cycles for faster sourcing and approvals.
- End-to-end automation of the Source-to-Pay Solution process to reduce the time consuming inefficiencies that occur between steps of the process.
Faster Supplier Onboarding
Supplier onboarding delays often create bottlenecks that disrupt procurement workflows. The study revealed that prior to Ivalua, onboarding suppliers typically required 14+ days.
Using Ivalua’s automated workflows, organizations reduced onboarding time by 80%, bringing it down to as little as 1-5 days.
Business Impact:
- Faster access to preferred vendors.
- Reduced compliance documentation errors.
- Improved supplier relationships, fostering collaboration and accountability.
How to Gain Similar ROI:
- Standardize and automate supplier intake management documentation.
- Ensure real-time compliance validation to onboard vendors efficiently without errors.
- Eliminate roadblocks to supplier enablement, leveraging systems without fees, terms for suppliers to accept or limitations on activity.
Streamlining Invoice Processing
Finance and procurement teams historically wrestle with manual, paper-based invoice processing, which slows payments, results in errors, and consumes valuable resource hours.
Ivalua automates 95% of invoice processing tasks, achieving near-touchless workflows where invoices are validated and routed automatically.
Business Impact:
- $1.3 Million Saved
- Reallocation of up to 90% of accounts payable (AP) staff to higher-value activities.
- Faster approvals and improved supplier payment accuracy.
How to Gain Similar ROI:
- Adopt touchless invoicing to reduce administrative overhead.
- Integrate procurement solutions with financial systems to streamline validations and reconciliations.
Download our Invoice Datasheet here.
Decommissioning Legacy Systems
We know that many organizations suffer from costly, disconnected procurement tools that generate operational silos. Ivalua consolidates all S2P activities into a single platform, saving companies significant operating expenses and improving system efficiency.
Business Impact:
- $1.2 million saved by replacing six legacy tools with Ivalua.
- Simplified workflows and IT overhead lead to long-term scalability.
How to Gain Similar ROI:
- Transition to a single S2P platform to centralize all sourcing, contracting, purchasing and invoicing activities.
- Phase out legacy systems gradually to minimize disruption while consolidating processes into Ivalua.
Check out how Ivalua’s procurement automation software solutions to streamline and automate the procurement process within an organization in this blog.
Increasing Spend Under Management
One of the hallmarks of procurement efficiency is increasing spend under management. Ivalua helps organizations maximize supplier contracts and sourcing coverage while reducing maverick spend.
Key Achievement:
- Spend under management significantly increased. According to one interviewed business, it increased from 20% to 58% in the first year and is expected to exceed 80% by 2027, unlocking millions in cost reductions.
For more information on analyzing spend management, check out our Spend Analysis section.
Additional Benefits Beyond Numbers
The Ivalua platform also offers benefits that are harder to quantify but equally impactful:
- Improved Data Visibility: Centralized dashboards offer procurement leaders real-time insights into spend, contracts, and compliance, enabling faster responses to business demands.
- Compliance and Risk Mitigation: Built-in governance and audit trails ensure adherence to regulatory frameworks, reducing the risk of supply chain disruptions.
- Support for ESG Initiatives: Capture sustainability data from suppliers to align with environmental, social, and governance (ESG) goals.
- Scalability to Meet Growth Demands: The modular design of Ivalua supports seamless integration of new business units, making it future-proof for expansion.
Real-World Customer Success
One mid-market insurance company cut operating costs by 20% using Ivalua, while rationalizing its supplier base by 70%. A US defense contractor reduced operating costs by 30% and supplier onboarding time from 21 days to just 1 day, supported by the platform’s seamless workflows and automation.
Why Ivalua is a Strategic Investment
The financial analysis provided by the TEI study reinforces the value of Ivalua for organizations aiming to build modern, agile procurement functions. The ROI of 393% and an NPV of $25.5M demonstrate the scalability, efficiency, and long-term cost savings Ivalua delivers.
The rapid payback period demonstrates the quick return and broad set of benefits, the improved ability to increase margins while simultaneously improving risk management, ESG performance and achieving other objectives.
Ready for the next step in your journey? Check out our Source-to-Pay Platform to get started!
Conclusion: Exploring your ROI
If your procurement operations are hindered by inefficiencies, fragmented systems, and legacy costs, the solution is clear. Ivalua’s TEI study proves that a modernized, unified platform is the way forward—not just for financial savings but also for operational transformation. It delivers a rapid return on your investment with continuously increasing value.
Explore your potential ROI. Sign up for a demo and discover how Ivalua’s Spend and Supplier Management platform can elevate your operations today.
FAQ’s
What is the Total Economic Impact of Ivalua’s platform?
According to a study by Forrester Consulting, organizations using Ivalua’s platform achieved a 393% ROI and a Net Present Value (NPV) of $25.5 million over three years. Benefits included process automation, reduced overhead, enhanced visibility, and faster supplier onboarding.
How does Ivalua improve procurement efficiency?
Ivalua automates key procurement processes such as sourcing, contracting, and accounts payable tasks. Organizations reported cutting cycle times by up to 40% and reducing procurement and accounts payable operating costs by 20-30%.
How quickly can I achieve ROI with Ivalua?
The Forrester TEI study found that organizations experienced a payback period in under 6 months, showcasing the rapid financial and operational benefits of Ivalua.
What sets Ivalua apart from other procurement platforms?
Ivalua offers:
- A unified, scalable platform with complete S2P capabilities.
- Best-in-class automation that eliminates inefficiencies.
- Proven financial returns, backed by a 95-100% customer retention rate for over 20 years.
- Enhanced ESG tracking and compliance capabilities.
