This interview is taken from an episode of the Spend Culture Stories podcast. In this episode, Lilia shares her entrepreneurship story, mistakes companies face when it comes to tracking company spending in the procure-to-pay cycle, and how to evaluate the best P2P Solution.
About the Podcast:
Your company culture might attract talent, but your Spend Culture will make or break your company.
Spend Culture Stories is a female-hosted and produced podcast that helps finance leaders learn the tactics, strategies, and processes to build a proactive Spend Culture.
Learn how to pick the right tools, implement the most efficient processes, and how to develop the right people to transform the Spend Culture of your organization for the better.
Former Director of P2P At Coca-Cola Shares How to Track Company Spending
CEO of Transformify. CPA.Fintech and Digital Transformation Expert. Professor.
Lilia Stoyanov is the CEO of Transformify, a recruitment platform that helps businesses to hire a diverse workforce, run CSR programs,and transfer secure payments worldwide. Prior to founding Transformify, Lilia led a team at Coca Cola, where she implemented digital transformation processes in P2P.
In this episode, Lilia shares her entrepreneurship story, mistakes companies face when it comes to tracking company spending in the procure-to-pay cycle, and how to evaluate the best P2P Solution.
Speakers: Lilia Stoyanov, CEO of Transformify
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What do you think are some poor practices that you’ve seen in your career when it comes to company spending practices?
What I’ve seen mostly as an auditor is that due to whatever reason misbehavior and non-compliant spending is tolerated by the management because the person is a top performer. It could be the business development team that is normally tolerated or just people could be given credit cards with much harder limits just because they deliver to the business. Nobody questions the fact that they don’t follow the rules. They may not file their expenses at all sometimes, and they may not collect invoices or receipts.
In extreme cases, they may not collect or documents about their flights and decide to take business class or transatlantic flights which are costly. But this happens just happens and is the organization that should not tolerate it.
How could you get the company realize or measure the ROI of implementing a software solution, and to select the right solution that is addressing the business case and the needs of the company?
What is right for Coca-Cola may not be right for IBM because it’s a different business. It’s a different industry. Starting from there, what they need to consider is the technologies that they have in place and how easy it is for the new solution to be integrated with the existing technologies. Sometimes the solution itself and the one may be in right for the business but it needs to be integrated with whatever is there. And this may take customization, additional resources, and may result in significant cost. This needs to also be taken into account before a decision is made.
How do you usually suggest for financial leaders to establish financial controls within an organization? What are some tips and tricks that you can give both being a CFO and also a former Director of P2P Coca-Cola?
It really depends on the Spend Culture of the organization and its size. The financial controls put simply are just controls about how much do you spend and how soon do you need to react if you see that your revenues are below the budget.
It’s always on two sides. One is the revenue side, and someone needs to monitor these typically real-time and to alert the relevant people if something’s going on there. To me is much more important to generate more revenue than to spend less. Companies should focus on growth rather than try to cut costs.
On the other hand, there needs to be a dashboard that is put in place to show you how much have you spent. What is your runway? Do you have enough money? Do you need to raise funding? (If this is your case because you’re not profitable enough to sustain on your own etc), and it’s not something complicated. For smaller companies, it could be done even with an Excel spreadsheet provided that you have people with the right knowledge on board and there is someone sending a report regularly to whoever is concerned so they have timely information and could make informed decisions.
That being said, what is something that you would like to see as a dream solution for managing spend? What does that look like?
Something that is flexible, and at the same time, provides traceability. Being flexible could create all sorts of issues with historical data. Imagine that over time, you want to change how certain expenses are disclosed so you create a new account in your chart of accounts. And as of January the 1st 2019 for example, you start disclosing is using the new account, but you need to always report to previous years.
It’s required for X reporting purposes. It is required for budgeting purposes. It is required for any management reporting purposes. In general, you need to be able to see what is the deviation versus prior year vs. three years ago etc.. and that flexibility on the full side is super good to have. However, it could be a really big mess because you cannot compare to the previous periods.
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The Book of Spend Culture: How To Master Rapid Growth Without Running Out of Cash
Learn the secrets behind the success and failures of Amazon, Snap, Fab and Wework, and how improving their Spend Culture has brought them closer to meeting their goals.Read The Book