Compleat Spend Control - Getting More From Less (Brian's Story)
Every Managing Director understands the challenges of a tough trading environment. It is harder to find business, harder to maintain margins and all of your customers are demanding more for less.
The overheads are not static either. People want pay rises, the costs of basic services are on the up and all this means that every Managing Director is constantly looking at ways to increase productivity and drive down costs.
The Problems
Brian has already done all the basics. The company has good sales and marketing infrastructure, a sound accounting and management information system and comprehensive budget management. Brian needs to find additional areas to improve productivity and reduce costs.
Brian recognises that there is no-one in the company that has responsibility for how the business spends its hard earned cash and decides to personally investigate what is REALLY happening.
Brian meets with Bob who places orders with suppliers. Bob buys from his own preferred suppliers and whilst he might haggle a bit, Bob does not see it as his responsibility to get the very best price every time. Brian realises that he has a lot of “Bobs” in every department, all acting independently and as a result, the company is buying similar goods and services from multiple suppliers. Brian understands that the company is wasting money on a large proportion of what they buy.
Brian talks to Ethel, because she is constantly blowing her budget. Whilst Ethel does her best to keep track of everything that is being purchased moment by moment, inevitably she fails, but only finds out after the event. Brian recognises that stopping maverick over budget spending is going to save a lot of money.
Next, Brian talks to Pete. Pete is drowning in piles of paper purchase orders, delivery notes and purchase invoices and they are scattered across the entire organisation. Pete’s phone never stops ringing with people chasing to find out whether the order has been placed, if it has been received and why a supplier has not been paid and the account is on stop. Brian realises that his entire organisation is chasing bits of paper, which is a complete waste of time.
Finally, Brian talks to Margaret, who does the month end accruals, management accounts and cashflow. Margaret explains that she guesses the month end accrual each month to reflect all the purchase invoices which are still in the system and not reflected in the accounts. Margaret does so by assuming that each department has spent their budget exactly and accrues for the difference.
The management reports and cashflow Brian uses to make all the big decisions are based on that guess. Brian is uncomfortable with the realisation that his critical management information is based on guesswork.
Brian understands that addressing the problems of Bob, Ethel, Pete and Margaret is going to save a lot of money and a great deal of time. The question is how?
The Solution: Compleat Spend Control
Brian gets in touch with Compleat. Compleat offers a Purchase to Pay solution that automates the entire purchasing process and employee expenses automation. Compleat also offers membership to the Compleat Buyers Group to make savings on what he already buys, simply by paying less.
Compleat recommends that one of their consultants has a 90 – 120 minute meeting with Brian’s Finance Director to undertake a Short Form Savings Review and SCORE process.
The outcome of the meeting is a report that identified the savings potential from using the Buyers Group, the turnkey cost of Compleat Purchase to Pay and / or Employee Expenses and the resulting Return on Investment by setting the savings potential against the cost of automation. It was a pleasant surprise.
Compleat undertook a detailed presentation to the senior management and purchasing stakeholders to demonstrate exactly how the solution would operate and how it would address the problems. They also showed how Compleat Spend Control would deliver the productivity gains and savings that Brian was looking for when he started his investigation.
Compleat removes all the paper and replaces it with a single seamless, paperless process from the creation of a request to purchase, through approval and budget checking to purchase order, through receipting (where desired) and purchase invoice capture, approval and posting automatically into the accounts system. Everyone in the organisation can see the exact status of every order and all the paper disappears. The productivity gains across the entire organisation could be huge.
Compleat also ensures that every request to purchase was checked against the available budget in real time, so over budget spending was a decision and never a mistake. It solved Ethel’s problem and would stop maverick over budget spending.
Compleat also introduces commitment accounting, so Margaret can see every purchasing commitment as far into the future as they exist. Brian’s management accounts and cashflow will be available much earlier each month – and the information they contain is accurate to the last penny.
However, the biggest benefit was the savings available for the Compleat Buyers Group (CBG). By deciding to use the CBG supplier and using Compleat to enforce the purchasing decision for every Bob involved in purchasing, Brian will save money on a very wide range of products and services simply by paying less on what they already buy.
Brian’s team agreed. Everyone is going to benefit.
The Detailed Review Savings Analysis
Compleat undertook the Detailed Review and quantified the exact savings available for Brian’s company, who the suppliers are and how much could be saved.
This review formed a key part in the implementation of Compleat, so that the potential savings started taking place for the moment the system went live.
The best part of the story is that the ROI of the project was less than 6 months. Brian will continue to save money far into the future, whilst his staff focus on their jobs and not chasing paper.
About Compleat Purchase to Pay (P2P)
Compleat P2P software is a 100% browser based application designed specifically to be used by staff involved in the purchasing process,
that have little or no experience or expertise in utilising business automation software. Staff user training can be achieved in as little as one hour, demonstrating the unique “ease of use” of Compleat.
Compleat P2P can be deployed on a Microsoft SQL Server platform either locally or within a hosted environment.
Compleat provides tight “packaged” integration with most leading accounting software products including Infor FMS SunSystems. Microsoft Dynamics GP, SAP Business One, Pegasus Opera II & 3. Sage Line 50 / 200 / 500 / 1000 and CODA Dream. The range of supported accounting systems is being continually extended.
Compleat also provide Compleat Employee Expenses automation.