We often talk about ways procurement can achieve alignment with ‘the business.’ And while that dynamic is important, some relationships have to be more one-on-one. The relationship between the head of procurement and the CFO is a prime example.
In too many companies, exchanges between procurement and finance are confined to trying to figure out where savings went and how to measure procurement’s actual impact. This is a lost opportunity for both sides. Procurement can deliver far more than savings, and much of that additional value is of great interest to the CFO.
Take ESG initiatives as an example. CFOs are prioritizing ESG metrics for the sake of meeting customer expectations, working with employee advocacy groups, and in response to input from company shareholders. Procurement can be an excellent partner on this front, and the more accountability and documentation are called for, the more contributions procurement can make.
As Bryan Baum, Head of Solutions, Sourcing & Procurement at Anaplan, told us in a recent AOP Live session, “Smart CFOs and organizational leaders are having to address ESG concerns on all fronts – their consumers, their employees, and their boards. They may ask, “How are we looking out at what we are doing with our social programs – whether that’s environmental, whether that’s social, whether that’s the governance programs and equality within their own employees or board of directors?” This really permeates down from the C-suite into programs like the ones managed by Nick Wingbermuehle, Senior Director of Capabilities and Continuous Improvement within the North American Zone Sustainability and Procurement department at Anheuser-Busch. How can we contribute to achieving the goals that they’re setting up for those sustainability programs?”
Procurement has so much to offer in terms of talent, experience, data, and insights – especially for programs like ESG that are highly dependent on suppliers to deliver results. Alignment between procurement and the business can start with a meaningful, action-oriented partnership, and grow from there.
For more insight into procurement’s potential contributions to connected financial planning, listen to Bryan, Nick, and Dr. Adrian de Groot Ruiz, Executive Director of the Impact Institute, speak with Philip Ideson in their recent AOP Live session: Connected Planning for Financial Outcomes and Sustainability.