Author: Luke Taylor CCO & Deputy CEO
Date: 6th June 2016
I attended a very interesting event a few weeks ago, where a number of chief financial officers from leading CSP’s around the world presented and discussed their experiences, strategies and predictions for the coming year. One topic that resonated with me in particular was a presentation by a CFO of a large European telecom service provider. He presented and discussed his own company’s strategy and initiatives for Finance and Procurement departments working more closely together to ensure competitive advantage in the marketplace. Finance and procurement working together – seems a common-sense approach and already exists, right? Well yes, but historically more in the case of budgets being set, individual departments spending their respective budgets through a Procurement process and Finance at the end of the day paying the vendors invoices.
But it seems there is a new more proactive approach maturing in the marketplace that ensures there is visibility, interaction and communication throughout the financial lifecycle and procurement chain, where both the CFO office and Procurement contribute to the procurement process with the objective of competitiveness. And the benefits of such a strategy are tangible for the Service Provider – Reduction on cost base, shorter lead time and approval process, better terms and conditions, better cash flow and working capital as well as simplifying the process, promoting transparency and better working processes and more effective vendor management. As well as all these positives, incorporating larger purchasing power though consortium type initiatives where either telecom companies in larger parent groups or joint ownership procure larger volumes and hence demand larger discounts.