Welcome to the final article in a five-part series that will focus on how procurement, finance, and other professionals effectively build a “compliance management” checklist that addresses multiple avenues of spend management and the compliance ramifications behind strategic spend categories. The first four articles highlighted the dozen items that should be included in an enterprise’s procurement compliance checklist, which span across supply management, risk management, and complex spend management. The fifth and final article in the series will detail how collaboration plays a vital role in both building this checklist and amending it when the need arises.
The modern procurement executive realizes that in order to maintain control over its function, he or she must take into consideration the evolving aspects of its business. This CPO Rising article series has focused on the notion of compliance management and the items that must be part of a “compliance management checklist” that professionals can rely on as they go about their sourcing or procurement efforts.
However, from time-to-time, regulations change and business requirements evolve, forcing enterprises to amend their compliance checklists to stay current. The following aspects must be considered when attempting to amend the items that comprise the contemporary procurement compliance checklist:
- Align amends with those functions that hold relative expertise. Since many of the compliance management checklists refer to specific categories and sub-areas of supply management, such as contingent labor and business travel, it is imperative that when amending these areas, procurement must pull in those executives and functions that hold relative expertise. With much of the amendment focus on staying current, these stakeholders will be able to easily alter checklist items to align with evolving standards.
- Understand the implications of potential checklist amendments. While checklists must be deep, too many items can bog down risk management initiatives. When an item is added, edited, or updated (or even removed), an enterprise must be aware of the implications of that change, whether it be legal, financial, or otherwise. It is critical to invest in a collaborative process by which every procurement compliance checklist amendment is discussed and agreed-upon before being finalized. Items such as labor compliance can have dire ramifications (i.e., federal audits) if not amended in the proper manner and are not up-to-date with current legal requirements.
- Build a “best practices” casebook of compliance issues and the company’s responses. A C-level executive’s purview is always aided by first-hand experiences and the strategies that were successful in managing various business issues. The average enterprise battles compliance management issues on a daily basis, and it behooves the stakeholders involved to take note of the best practices that were involved in “victories” to build a “compliance casebook” that can help future executives appropriately address specific business compliance threats.
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