6 Core Topics for Settings and Achieving Indirect Cost Management Goals
For the Budget planning season, we would like to support you with some very practical recommendations on cost saving target setting.
For Finance it is essential to possess reliable information on future cost developments. That requires a good working relationship with Procurement. But are both functions always aligned on the most important topics?
Given the cascading down of a company’s financial objectives, the Procurement strategy should be aligned with the CFO’s long-term plan.
In this whitepaper we therefore explore several themes including accountability, processes and spending visibility to help companies achieve their cost management goals better and faster.
These and other questions and some very practical tips for a successful cooperation are included in this free knowledge report. Download it now and share your experiences with us!
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"The potential impact on the bottom line is vast, but at the same time also often vastly underestimated."
Getting the right information
Both Finance and Procurement touch upon the workings of all functions throughout the organisation. They both have entangled financial responsibilities and therefore should speak each other’s language and understand and respect their complementary role.
The Procurement strategy should be aligned with the CFO’s long-term plan, so it’s important for all departments to understand the following:
- Are specific budgets for the various departments/divisions defined?
- Are these linked to cost reduction targets? What is their rationale? Benchmarks?
- Are these targets agreed with Procurement in a concrete plan of action?
- Who is responsible for the final result?
Agenda Suggestions
This whitepaper explores six core topics including accountability, processes and spending visibility to help companies achieve their indirect cost management goals.
There’s also some agenda topic suggestions to help prepare for your next CFO/CPO meeting.
Turning Data into Knowledge & Action
Savings are only savings when they have a tangible and measurable effect on the bottom-line. It is the responsibility of Procurement management to ensure this happens.
In order for Procurement management to protect their future success, they need to be able to turn data into knowledge
and action. Just achieving ‘nice to have’ is not worth the effort (nor the cost involved). Analysis is indispensable as a basis for ongoing improvement and so, we are back to the beginning of our thinking: how can Procurement become an effective and recognised partner to help achieve the company’s financial targets?
It is now about delivering real results.
Today, the Procurement function does (or at least should) represent more than cost savings only. We agree with that principle more than anyone but business operating cost reduction, being one of the most tangible contributions to corporate (financial) performance, deserves to be managed professionally and that will only happen when the CFO and CPO talk and agree on the best way forward.
Download our full white paper today which provides tangible actions you can take within your business to help you gain a competitive advantage.
"Savings are only savings when they have a tangible and measurable effect on the bottom-line. It is the responsibility of Procurement management to ensure this happens."
About the Author: Peter de Heer, partner with Expense Reduction Analysts in Brussels, is a senior business manager, building on a long standing international career with various Fortune 500 companies. He has accomplished a wide range of cross-functional business, procurement and general management assignments in several countries in Western and Eastern Europe as well as Latin America. He is focused on achieving a high degree of process and value efficiency for his clients.
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