TECHNOLOGY
operating models for over a decade . With Kissflow Procurement Cloud , a flexible procurement software that streamlines the end-to-end procure-to-pay process , Kafil helps medium and large enterprises with their digital transformation projects .
“ Rogue spend is expenditure with staffing suppliers outside of prenegotiated contracts or the guidelines of the organisation ’ s contingent workforce programme ”, says Kafil . “ This in other words is essentially off-contract buying .”
According to Kafil , the problems caused by rogue spend are varied . “ It is critical to have control over your company ' s spend and finance . Rogue spending can be financially draining , inefficient and ineffective . Rogue spend creates problems like putting businesses at risk of noncompliance , unpredictable budgets , and reductions in both forecasting accuracy and overall business profits ," says Kafil .
However , there are steps in procurement automation that businesses can take to ensure they are safe from rogue spending . “ By implementing a purchasing system that automates the procure-to-pay process ( P2P ), organisations can reduce rogue spend while also making purchasing more efficient and cost-effective . Automation essentially brings in two major factors : visibility and ease of purchasing .
Kafil says “ The visibility offered by data generated by automation can enable procurement managers to not only track activity through the process , but also aggregate the data to find improvements for the company as a whole . The Spend Analytics from a digital procurement software can eventually help businesses gain clear visibility over the spending behaviour , negotiate better deals with suppliers and tighten their grip on reducing their rogue spending .
“Rogue spend creates problems like putting businesses at risk of noncompliance , unpredictable budgets and reducing overall business profits ”
MOHAMMED KAFIL SENIOR PRODUCT MANAGER KISSFLOW PROCUREMENT
“ Rogue spend can take place when buyers within your organisation don ’ t know the correct procedures . Automation essentially brings in tech-enabled policybased compliance into the buying process . With guidelines in place , this eventually reduces the possibility of purchases going out of pre-negotiated contracts .”
Transparency is key But while automated procurement solutions have an important role to play in controlling maverick spend , to be truly effective , P2P software needs to be part of a holistic approach to eradicating maverick spend .
On this note , CIPS stresses the importance of changing behaviour around procurement , and the key to this is clear and consistent communication .
112 January 2022