- Finance and procurement – a fine romance or the best of enemies?
Finance and procurement – a fine romance or the best of enemies?
How come it is still so hard to collaborate across functions?
Anna Bjärkerud, founder and Managing Director from EBG, shares her reflections on the audience insights given in our recent webinar cooperation.
You are welcome to re-view the webinar session by EBG enabled by Basware, here>> How does your situation compare with peers attending the live session? Find out!
Competencies coming together
Tuula Tuonen, Sushmitha Koka and Jason Vincelette at Basware shared the benefits and potential conflicts of working with an end-to end purchase to pay (P2P) process. They gave great examples on how your organisation can take steps towards maximising process efficiency. We also learned how P2P automation can be the factor that aligns procurement and finance departments together.
Finance and procurement collaboration
During the webinar, we asked the audience how they see their own organisation collaborating across functions. Out of the many respondents, a clear majority do not scale their finance and procurement collaboration higher than a medium “3”. Having poll questions always open as many questions as it answers – one obvious here being why collaboration is not better than this.. The discussion at the end of the session might give some answers! (find the webinar recording here>>)
Collaboration increase initiatives
Poll question during the webinar: Which initiative do you believe will increase cooperation the most? This poll question also opens up many additional questions. Have the respondents experiences in shared metrics and seamless integration? (Given the responses during the previous question we think not) and hence choose it? In any case there are two clear “winners” here. The obvious advice would be to focus on creating and following up on shared metrics. (How do you define a saving, how do you work with POs and goods receipt, how do you work with days payable outstanding, how do you follow up on value creation etc.) Also evaluate and consider how seamlessly your procurement and AP department can exchange data, follow up on supplier performance and cash flow etc.
During the Q&A session we brought up the question; why is it hard to unify metrics and what stops organisations from having a more seamless integration between procurement and AP solutions?
One reflection was: “I see that the management are not giving guidance or “rules of engagement” and letting the AP and procurement department “fight” over how it should be. Procurement want to systematise the way we work with our suppliers and the AP department and many users feel it is just “easier” to just pick up the phone or send an email to place the order. Without any clear strategy and guidance from management the organisation will have a tough time to apply the “No procurement, no pay policy”.
Another reflection was: “In my opinion, the reason for not having common metrics on spend and savings etc is that by nature, both finance and procurement are viewing the data from different angles and seeing the data at different level of details. Other things are important for Finance and again others for Procurement.”
In a Basware survey of Finance and Procurement professionals, we sought to understand how alignment between the two functions is changing. We found that, promisingly, organisations are taking proactive steps to drive this sort of positive change because there are a number of factors that are driving this need for increased collaboration. Find the e-book here>>