The Sourcing Industry Group (SIG) kicked off its 59th Global Executive Summit on Tuesday with conversations covering procurement, finance, sourcing, cost savings, artificial intelligence, category management, workforce, data analytics and more.
The online Summit began with a keynote session between SIG CEO Dawn Tiura and guest speaker Todd Ford, the CFO of Coupa, a provider of solutions for business spend management (BSM).
The session titled “Smarter Together: It’s Procurement and Finance’s Time to Lead” brought to light the ever-growing importance of having CPOs and CFOs come together to help businesses grow forward rather than backward. Tiura and Ford sat down virtually to talk about the relationship between CPOs and CFOs as well as the trends affecting procurement and finance, which has been placed under a microscope the last few months.
Ford said the most important thing to keep in mind as a business, regardless of size or industry, is shareholder value. It’s important to honor the responsibility of doing right by them, he said.
While many think companies have placed less of an importance on the CPO and their business functions, Ford said the CPO is a key business partner in driving an organization forward, now and into the future. The relationship of the CPO and CFO is “critical,” according to Ford. If CFOs and CPOs aren’t setting up at least weekly meetings, companies should really consider what that lack of visibility could mean.
“Good CFOs recognize the power of CPOs,” Ford said. “Sixty-four percent of CPOs report to the CFO. That number should be 100%.”
In regard to the COVID-19 pandemic, Ford said this time is the golden opportunity for CPOs to lead and act as a catalyst for driving shareholder value. If a CPO is working for a company that doesn’t place as much value on spend management, it’s imperative that the CPO gets a seat at the table and advocates for spend management to drive business outcomes.
Data and spend analytics in procurement
In an afternoon speaking session titled “Procurement Saves America: Unprecedented Data is Enabling Procurement to Lead in Unprecedented Times” with executives from Nordstrom and Suplari, the speakers mirrored the topics covered in the keynote address. Additionally, this session discussed the importance of using quality data analytics to monitor spend and procurement.
Karoline Dygas, vice president and CPO of Nordstrom, said spend analytics has become a huge focus for her organization this year. One way she and other CPOs can make helpful suggestions for organizations is to make the case for new, quality technologies in their role. Dygas said she is a big believer in facts and data presented in the right way to the right leaders to create the story and make great change.
Knowing suppliers’ suppliers
If COVID-19 brought to light any major flaws in the current system, it was the reliance on just-in-time supply chain theories. Ford said more and more, companies will work on developing relationships and oversight of not just third-party suppliers but down to fourth-party suppliers.
Tiura suggested more companies may be looking to local suppliers to fulfill needs, but Ford cautioned that it’s very dependent on the business.
“People will do what will mitigate risk,” Ford said. “Is there a hybrid? Local sourcing, if it will mitigate risk, that’s a potential solution.”
Diversity and inclusion
Another hot topic of 2020 has been diversity and inclusion. Ford said companies that focus on improving their diversity and inclusion practices will only further promote their shareholder value. Diversity investment will improve stakeholder value and opinion, which will eventually lead to shareholder value, affecting the bottom line.
“It’s something investors care about,” Ford said. “It’s part of a larger framework of doing right by your community, then it’ll do right by your business.”
On the supply side, Dygas said supplier diversity is just as important as ever. It’s about enabling communities to really thrive in organizations, not just survive.
“Frankly in my opinion, you can never do enough in this space,” Dygas said.
2 more days of online SIG Summit
The online SIG Global Executive Summit continues Wednesday and Thursday. Thousands of procurement executives, experts and thought leaders globally come together to experience the thought-leadership, networking and insights about what’s happening in procurement right now. In a year that has tested many procurement and supply chain professionals, the SIG Summit offers timely information and resources for all.