I recently led a webinar titled When Procurement Met Finance: How to Achieve the Hollywood Ending. Our premise was straightforward in principle, though tricky in execution: what activities can procurement (including CPOs, COE leaders, source-to-pay technology leads, category managers and others) and finance (CFO, controllers, AP, treasury, etc.) do to work together to achieve the “Hollywood” outcome where everything somehow works out in the end, and hopefully in a faster period than the time it took Sally to commit to Harry. If you have some time, it’s worth watching yourself (watch the recording here).
I’ll level with PRO subscribers: while we wanted an aspirational message for the general attending public, achieving the Hollywood ending is not easy – and in fact, few organizations truly succeed in joining finance and procurement at the hip. But there are some critical steps necessary that can help an arranged marriage of the two along, even if it’s not love at first site, and at the very least, to avoid a costly divorce. Note to the procurement executives reading this brief: 95% of the time, CPOs will not end up on the positive side of things when finance and procurement fail to collaborative effectively.
CPO and CFO tenure provides insight into this. According to CAPs data (somewhat dated, but still accurate in our view), the “average tenure of a CPO in his or her present position [in 2007] was 4.0 years, down from 5.9 years in 1995 and 6.1 years in 1987.” Contrast this with an Accounting Today study from 2010 that found in a survey that the “average tenure for a CFO” according to those surveyed was 12 years. This tenure is lengthening, and “compares to [tenure periods of] nine years and eight years in surveys conducted in 2006 and 2000, respectively, by staffing company Robert Half Management Resources.”
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