PROACTIS Blog

You “Suddenly” Realise You’ve Become a Global Company – What’s Needed to Support a Multi-National Approach to Spend Control?

Charlotte Sutton
Charlotte Sutton,
PROACTIS
Even with the economic turmoil of the past few years – or maybe in part because of it – many companies that essentially operated in a single country a few years ago now find themselves with sales, support, manufacturing, R&D, and other operations spread across various parts of the globe.
In some cases, this expansion has been achieved through organic growth, in others, it’s been through acquisitions. Either way, many such companies’ Spend Control frameworks have not kept up with the expansion, leaving significant levels of purchasing activity happening outside the corporate framework of controls and visibility.

There are any number of reasons why a company’s Spend Control processes have not kept up with their operational expansion, but one reason for a lot of companies is that their existing eProcurement systems are simply not designed to support multi-national deployment. Some of the challenges for financial and procurement executives who recognise the need to regain organisation-wide control of spend are:
  • Varying languages used by employees across different countries and regions  
  • Varying currencies for POs and payments
  • Varying tax methods and regulatory requirements that must be adhered to at the local level
  • Varying financial and business systems 
  • Varying scale of operations in different countries 
  • Varying levels of procurement maturity
In order to standardise purchase-to-pay processes on a global basis, a company’s eProcurement system must be designed to address all of these issues. An eProcurement system not designed from the ground up to operate in a multi-national, multi-organisational environment simply cannot become an enterprise-wide Spend Control platform for a company with global operations. Capabilities to address the issues above cannot be bolted onto a system developed with just one country or one region of the world in mind.

Without a consistent enterprise-wide Spend Control umbrella, companies are missing out on opportunities to improve competitive, operational and financial performance by:
  • Eliminating unnecessary purchases
  • Ensuring purchases are made from the right suppliers (local or global) 
  • Leveraging the company’s full buying power
  • Sharing spend category expertise across the company
  • Providing enterprise-wide visibility of spend to enable analysis and further savings 
To gain perspective on this and other issues related to gaining effective Spend Control in a global company, download the PROACTIS paper titled: “Spend Control for the Multi-Location, Multi-Business Unit Organisation
 
 
 
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