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SAP governance, risk and
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Part of the
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Knowledgebase » Volume 3 (2010) » Update 2 Reduce Your Procurement Risks with Spend Analytics
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As part of its positioning for the corporate boardroom set of enterprise performance management applications, SAP BusinessObjects Spend Performance Management enables financial and procurement decision makers to have full visibility into both managed and unmanaged spend in the enterprise and throughout the supply chain. Learn how to reduce procurement risks in your supply chain and create a more effective organization in the post-crisis economy through the features available in SAP BusinessObjects Spend Performance Management. |
Categories: Compliance, Risk Management, SCM
| Key Concept |
| SAP BusinessObjects Spend Performance Management, part of the enterprise performance management solutions suite, allows you to quickly determine levels of unmanaged spend, identify duplicative contract scenarios, and target savings from sourcing efforts and effective negotiations. |
With any organization, the ability to focus on mitigating risks from the value chain and to provide sound financial governance over the disbursements of capital and other resources produce bottom-line results. Executives undergo business planning rounds to create the appropriate level of cash flow to manage their enterprises, and this need has only increased in the post-crisis economy.
Direct costs and the risk mitigation associated with managing these costs often falls to various organizations associated with contracting value chain members. These direct costs are spread across the value chain in exchange for goods, services, intellectual property, assets, and materials during product realization and service delivery. As a part of company spend, you also need to rationalize direct costs within financial tolerances and budgeting processes to reduce financial risk exposure.
In organizations both large and small, the procurement function is often the watchdog of company spend — particularly for direct costs incurred in the value chain. However, more than 25% of all organizations do not have a program to manage enterprise spend, and nearly half of those that have such programs don’t have clear visibility to all categories of enterprise spend. These situations can create confusion in the supply chain, where the organization can appear to have multiple decision makers and points of view. In addition, confusion may exist internally and different parts of the organization can have different and even competing objectives in the face of finite working capital and assets.
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