CFOs Seek Simple Solutions for Comprehensive Spend Management
As of today, we have a new implementation partner: CrossCountry Consulting. CrossCountry has deep expertise in helping companies of all sizes implement finance and accounting systems to meet business objectives such as process improvements, increased visibility and control and cost reduction.
We’re very excited to partner with their firm, and equally excited to have had the opportunity to sit down and chat with CrossCountry’s John Hoebler, managing director and Harpreet Narula, associate director. Together John and Harpreet have 37 years of experience working with finance organizations on accounting and procurement issues, process, risk and technology - John on the finance side and Harpreet on the P2P side - so we were very interested to talk to them about what they’re seeing in the marketplace and what made partnering with Coupa so compelling.
Coupa: You guys spend a lot of time in conversation with CFOs. What’s top of mind for them these days?
John: On the business end, they’re focused on spend management. It's a conversation about control and visibility. They have hidden costs and people who want to do the right thing, but their systems don't provide them with accurate data. If they’re doing POs, they might be dealing with blanket POs . They have people buying and expensing, or buying with petty cash. There are a lot of ways people can spend money and they want to get a handle on that.
On the technology side, they also want to simplify IT infrastructure. They want solutions that can quickly be implemented and don’t burden the organization with yet another software program that needs to be maintained. They do not want to have to go to IT and do a big project in order to change anything. They want to reduce spend but add functionality. That's a pretty common theme: how do I make my life simpler? The answer to that, of course, is the cloud.
Harpreet: John said it very nicely, and I will just sum it up. First, they want spend analytics. They want to know, what are we spending on, and who are we spending it with, so they can go after the big suppliers to get better pricing.
Next, they want to reduce infrastructure footprint. Third, and perhaps most importantly, they want ease of use. They want a system that people don't need to be accountants to use and complete a transaction properly. Those three elements together are what finance organizations are looking for.
Coupa: Is it ever amazing to you that with all the tools and technology companies have, they still don't know how they’re spending their money?
Harpreet: It is, but it's not. What I've seen on past projects is that spending is very siloed in most big organizations. You have IT or finance wrangling over managing the project, and then procurement, who is not even involved in the project. Then the CFO or CIO comes to procurement and says, "How much are we spending?" They say, "We have no clue."
John: I think it depends on a lot on the company. Do they see the procurement function as strategic? Or do they see it as an accounting function? Organizations that view it as strategic realize that there's process and then there’s optimization. If you put data and information in the hands of a well-run procurement office, they can negotiate contracts, and they can drive spend out of the organization. There's so much more they can do than process paper.
Coupa: Into which camp – strategic or transactional - do most of the people you talk to fall?
Harpreet: If you had asked me that question about seven or eight years ago, I would have said they see it mostly as just another transaction. Within the last probably three to five years, there’s been a shift to looking at procurement more as a strategic initiative. But it is a slow process to change company culture to get to that level.
John: I agree. Then there are organizations that see it as strategic, but they fail to make it strategic. Either because of inadequate leadership, misguided processes or bad tools or systems, it becomes tactical.
Finding the right person, the right visionary that can drive strategy is key. Everybody in the organization is spending money. There has to be that one person that has the ability to oversee it all and lead from the front. Then you enable her or him with the tools needed to make it happen. That's where Coupa comes into play.
Coupa: Talk a little about that.
John: As you know we do a lot of process improvement work. That can take many different forms, but a common form is procurement optimization.
People feel like they have runaway spend, they don't take advantage of supplier discounts, they have distributed spend and they want to create a shared procurement service. Those are all things that we help with. When we learned about Coupa, we thought, what a great technology solution to go along with process change and organizational design that we do with our clients, especially larger ones that might have a PeopleSoft, or an e-Business Suite, with a big clunky procurement engine.
They want a cloud-based solution that integrates well with these products and with the finance and accounting products of the future. Coupa slides in very nicely and provides a consumer-like business application experience to what we call "the common user." These are the people that do purchase requisitions, or want information on a vendor or a category, not necessarily your power users, although certainly they use it. It’s more for the casual user that needs an intuitive, easy to use product.
We thought Coupa plugged in well there, and then we also thought it plugged in well with the newer cloud products we work with. We’ve been doing process improvement work around this problem that Coupa is trying to solve for a long time. But we didn't have a great answer up until now.