Measuring implemented savings to foster better collaboration between procurement and finance
Generating cost reductions is a fundamental goal of any procurement function, and ‘realised savings’ are usually a key KPI. Yet in many organisations there seems to be a perennial mismatch between what is promised by the CPO at the start of the year, and what is found in the P&L at the end of the year.
Why does this mismatch exist? Were the CPO’s projections unrealistic? Did the savings simply not happen, despite being reported? Or did they happen, but can’t be pinpointed in the P&L?
Just as developing good market knowledge and insights from current spend trends helps to build credibility with business stakeholders, confidently reporting realised (or implemented) savings is increasingly important as procurement organisations look to gain credibility with their finance stakeholders.
Our experience shows that where procurement teams disengage with the business immediately following the sourcing phase or are not privy to the implementation phase, savings realisation drops to a mere 50% of the originally identified savings, annihilating the hard work done upstream.
This interactive workshop will cover how to avoid the mismatch between savings promised by the CPO at the start of the year and savings that hit the bottom line at the end of the year, by exploring ways to collaborate with finance and the business.
Areas of focus for the workshop will include:
- What are the causes of the disconnect between reported savings and realised savings?
- What are procurement organisations doing to fix it?
- How are savings being measured?
The workshops will take place from 09:00 to 11:00 at the Radisson Collection Strand Hotel, Stockholm (breakfast will be served from 08.30). We have limited spaces available and spaces will be allocated on a first come first served basis.