Aligning Finance and Procurement for cash flow optimization and liquidity —Phase 5: Sustaining alignment success with shared KPIs

For our series on aligning finance and procurement for cash flow optimization and liquidity we have published an introduction to each of the phases that make up that alignment. See:

• Phase 1: Understanding the Foundations
• Phase 2: Identifying common cash flow misalignments
• Phase 3: Structuring the collaboration for cash flow optimization
• Phase 4: Leveraging technology for cash flow enhancements
• And read our Executive Summary here. 

For the final stage in the process let’s introduce phase 5.

Phase 5: Sustaining alignment success with shared KPIs

To ensure long-term cash flow stability and liquidity optimization, organizations must track key performance indicators (KPIs) that align finance and procurement objectives. Without a shared measurement framework, procurement’s financial impact may go unnoticed, and finance may lack visibility into cost savings, supplier risk and payment efficiencies.

As noted in this article Aligning KPIs & Success Factors – Measuring Impact “By tracking supplier performance, financial forecasting accuracy, and cash flow optimization, organizations strengthen finance-procurement alignment and enhance financial sustainability.”

The following section outlines essential KPIs and performance review mechanisms that drive accountability and enhance financial visibility.

1. Key joint performance indicators (KPIs) for cash flow management

• Days Payable Outstanding (DPO) vs. Supplier Relationship metrics. Extending DPO helps optimize working capital, but it must be balanced to maintain supplier trust and reliability.
• Percentage of spend under management. Measures the procurement spend controlled through approved contracts, ensuring compliance and cost efficiency.
• Capture rate for available payment discounts. Tracks how well early-payment discounts are leveraged to enhance liquidity and reduce costs.
• Cash Conversion Cycle (CCC) improvement. Evaluates how efficiently a company converts investments in inventory and other resources into cash flow.
• Reduction in payment errors and exceptions. Ensures that automated invoice processing and procurement-finance integration lead to fewer disputes and improved cash predictability.

2. Performance reviews and real-time dashboards for financial visibility

To sustain improvements in cash flow management and liquidity, organizations must regularly review finance-procurement KPIs and ensure executive visibility through real-time dashboards. A structured performance review cadence enhances accountability, data-driven decision making and financial agility.

Regular finance-procurement performance reviews — such as weekly cash flow forecasting meetings, monthly supplier payment strategy reviews and quarterly working capital assessments — are essential to ensure financial alignment and continuous improvement. 

Leveraging executive dashboards for financial visibility:

• Working capital performance tracking. Measures real-time cash flow improvements from procurement strategies.
• Cash availability for strategic investments.  Ensures that procurement-led cost savings are allocated effectively to enhance liquidity.
• Cost of Goods Sold (COGS) optimization.  Analyzes procurement’s role in reducing supplier costs and improving financial margins.
• Supplier financial health and risk profiles. Monitors supplier stability and contract compliance to minimize financial exposure.

By integrating structured performance reviews with real-time dashboards, organizations can proactively manage cash flow, optimize working capital and enhance finance-procurement collaboration for sustained financial success.

Final comment

Achieving seamless alignment between finance and procurement is no longer a luxury, it is a necessity for organizations aiming to optimize cash flow, improve liquidity and drive financial resilience. As explored throughout this series, cash flow inefficiencies often stem from misaligned priorities, disconnected processes and inadequate technology integration. However, by implementing a structured framework, leveraging digital tools and defining shared KPIs, businesses can transform finance-procurement collaboration into a strategic asset.

The journey toward better cash flow management requires continuous effort. Organizations must proactively address misalignments, invest in real-time financial visibility and refine procurement strategies to balance cost savings with supplier stability. Technology plays a pivotal role in streamlining operations, enabling predictive insights and automating key financial workflows to eliminate inefficiencies. However, tools alone are not enough — success hinges on a cultural shift where finance and procurement operate as interconnected partners, jointly driving financial sustainability.

Ultimately, cash flow optimization is not just about managing working capital — it is about fostering agility, ensuring financial predictability and positioning the organization for long-term growth. By embedding collaboration, technology and performance measurement into core financial strategies, businesses can unlock new efficiencies, mitigate risks and build a more resilient financial future.

For in-depth,  practical and structured advice on enhancing cash flow visibility, optimizing payment timing, reducing working capital risk and improving liquidity outcomes, visit our  ‘Aligning Finance and Procurement’ guide.