About the relationship between finance and procurement | EBG Network
However, that's a bit difficult to achieve without a good relationship between sales and finance departments. Sales department works closely. Departments are busy working towards their goals and become disjointed. Read how one company used document workflow to bridge departmental gaps. The relationship between sales and finance doesn't have to be combative. In many companies, the chief executive officer requires each department to.
Annual Planning In many companies, the chief executive officer requires each department to generate and submit its own annual plan. The finance team plays the role of consultant and guides marketing employees -- who may not be proficient with or enjoy working with numbers -- through the process of completing the department plan.
Relationship between purchase department and finance department? - Blurtit
The expertise of the finance staff streamlines the planning process for the marketing people, saving them time and frustration. Finance staff members often find that marketing people want to learn more about planning but never had an opportunity before being asked to develop the annual plan. If actual revenues are significantly less than what was forecast, the consequences can damage the company by creating a serious cash flow shortfall.
Finance personnel are trained in forecasting and planning techniques.
They work with the sales team to develop revenue models that are realistic, with assumptions based on a thorough understanding of the economy and industry in which the company operates. Marketing personnel tend to be extremely optimistic.
The inherent conservatism of the finance staff can temper this sentiment, with the resulting forecast -- a blend of both views -- being realistic and attainable.
Relationship between purchase department and finance department?
Justification of Budget Requests When the proposed budget is presented to the CEO, the sales and marketing staff must be able to justify the increases in marketing expenditures included in the forecast.
The finance staff will participate in this meeting and answer the CEO's concerns so she can decide whether or not to approve the budget.
While the interests of marketing and finance might clash at these discussions, examining the rationale for budget requests gives the CEO the information she needs to make an informed decision about whether the expenditures should be made. It also means that other departments are kept in the dark about their colleagues work. Breaking this siloing habit is essential in improving the relationship between sales and finance.
Information must be made available to all, in order to gain a better understanding of the issues at hand.
Establishing an effective document workflow is crucial for information flow between the departments.
That way, the teams can easily share and access vital data, in order to collaborate and develop the best strategies that will satisfy both sides. For instance, the finance department can access sales data to understand why they are aiming for a certain strategy, while sales have access to financial data to understand why the budget cannot be exceeded. Mutual understanding is the foundation for any good relationship between the departments.
Establish good communication No relationship or collaboration can be established without good communication. A seamless line of communication is essential in securing good operation flow. Employees must be able to communicate with each other to solve issues and discuss solutions in a timely and efficient way.
Otherwise, the risk of misunderstandings and friction grows significantly. You can leverage modern technology, such as instant messaging apps, project management software or other means to improve communications between the departments and ensure a seamless sharing of information and data.
Improving the relationship between your sales and finance teams can easily come down to bringing those teams closer together.
That way, you can ensure that the teams can work closely together and share ideas that will produce the most viable solutions.
Even though sales and finances teams have significantly different roles within your company, they do in fact share common interests and goals. However, company departments often function independently from other departments, which can create unnecessary problems. Sales and finance departments are a prime example of having issues even when working towards the same goal.