Five steps to ease tensions between procurement and finance

Date Posted: 12/06/2019 Category:
Share this post:

Five steps to ease tensions between procurement and finance

Date Posted: 12/06/2019 Category:

The tension that often exists between procurement teams and finance colleagues can be fixed by implementing five practical measures, an eProcurement expert suggests.

Writing in Global Banking & Finance Review, eProcurement specialist, Paul Ellis, notes that finance teams tend to believe that procurement should be under their control as they set spending limits for each department. They see procurement’s role as identifying ways of achieving cost reduction and avoidance. However, procurement professionals understand that they also do much else. The different viewpoints often result in interdepartmental tensions.

Ellis’ five remedies for this predicament are:

  1. Improve mutual awareness

Procurement should share the positive impact they have, putting their work into the minds of other employees and showing finance exactly how they’re helping the bottom line. This will also show how digital tools for spend analytics, tail spend management, e-sourcing, SRM, and savings trackers help the business achieve tangible financial benefits.

  • Clarify areas of responsibility

Clear guidelines detailing who is responsible for what can help prevent procurement and finance pros treading on one another’s toes.

  • Create clear lines of mutual communication

Arranging regular inter-departmental meetings for voicing emerging concerns is the best means of avoiding tensions between procurement and finance teams. Keeping siloed in different departments makes it easy to ignore genuine concerns from the other team. Stakeholders thereby begin to see that collaboration is an excellent strategy.

  • Cooperate on tech measures

Another silo-breaking initiative is a collaboration between finance and procurement in choosing and implementing new tools – both teams can then see the benefits. Members of both teams could be elected to form a committee for selecting and launching new technologies for the business.

  • Ensure regular reviews

Thoroughgoing change in business not only has to be implemented but maintained as well. As Ellis puts it: “Regular reviews of the relationship between the two departments is key to ensuring that harmony becomes a core cultural trait within the business.”

You may also be interested in...

Churchill War Rooms
June 23, 2017
Odesma share their secrets in Churchill’s War-rooms
Odesma logo stacked

Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from our team.

You have Successfully Subscribed!