Chief procurement officers have plenty of work to do to satisfy the demands of their senior finance executive colleagues, according to new research.
An online survey of more than 200 CFOs, vice-presidents and directors of finance in North America found that less than one in five rated procurement's ability to provide timely and accurate spend data as "excellent", while a third said it was "poor".
A majority of respondents to the survey, commissioned by the software and services firm Ariba, agreed that "providing forward visibility of spending" was in need of improvement. Risk analysis, planning and forecasting, and ad-hoc decision support were other areas where CFOs were concerned about procurement's level of performance in supporting business decision-making.
CFOs did, however, have cost management at the top of their agendas and saw third-party expenditure on goods and services - rather than labour, benefits or facilities costs - as offering the greatest opportunities to lower costs.
Referring to the findings at an Ariba conference in Boca Raton, Florida, Bob Calderoni, the company's chairman and CEO, said: "Procurement is not where it needs to be in the eyes of finance today."
Speaking as a former CFO, he added: "Finance executives are data bigots. If you don't give them data they will shut you out."
Spend information was increasingly of interest to CFOs, Calderoni said, and there was a need for the finance and procurement functions to work together more collaboratively to improve the quality and availability of it.
This view was endorsed by Jim Polak, director of general purchasing at Pittsburgh-based PPG Industries, who noted: "We have a mutual dependency and it's growing. Finance needs procurement and procurement needs finance."
Jean-Jacques Beaussart, CPO of National City Corp, a top 10 US bank, said: "CFOs have to be my best friends, it's as simple as that."
But Sam Knox, director of research at CFO Research Services, which carried out the survey, warned that "in many instances, finance and procurement don't talk".
Perhaps not surprisingly, the survey found that procurement's performance in delivering information to the business was better in those companies that had automated their purchasing processes.