On the PurchasingInsight blog, there’s an excellent overview of how the idea of dynamic discounting can be viewed within a company, depending on who’s looking at the issue.

Dynamic discounting is a method for delivering a real return on capital – in some cases, over 30% per year – by negotiating discounts for early invoice settlement.  But making it successful depends on two key factors:  first, convincing all internal parties that paying invoices early is a good idea;  and second, having efficient P2P systems that ensure you can always hit the early settlement deadlines and capture the discounts.

The blog has several other articles looking in detail at this issue, which are all well worth reading.