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Spend Compliance: Act Now to Mitigate Excess Cost, Risk & Fraud, Advises PROACTIS
[March 08, 2018]

Spend Compliance: Act Now to Mitigate Excess Cost, Risk & Fraud, Advises PROACTIS

Organisations are losing billions in annual profits due to the inability to organise and analyse spend data and implement best practices to capture these lost savings. Complex spend management rules and standards are difficult to enforce, and often there is limited involvement of the necessary stakeholders to make it happen.

PROACTIS advises organisations to take action. To establish a clear strategy for spend compliance that ensures all organisation-wide purchases are in line with corporate policies, established budgets and negotiated supplier agreements to avoid costly and uncontrolled off-contract purchases.

Simon Dadswell, EVP Group Marketing at PROACTIS, said: "Organisations should be taking note of where cost savings are not fully being realised and putting in place compliance management programs to force adherence to spend guidelines. After all, improved spend compliance translates directly to the bottom line by reducing operating cost and increasing profitability."

Spend management requires a comprehensive compliance process that helps organisations to obtain better visibility and control of spend; to determine the appropriate structure and time to enforce compliance; to strengthen processes and establish best practices to support controls; and to involve all 'proper' stakeholders at all key stages.

This aproach is critical to an organisation's financial health and performance. It requires the ability to:

  • Monitor enterprise spending at a consolidated level, and down to line item, across departments, divisions, geographies and categories to ensure conformity with preferred suppliers, negotiated supplier terms and volume discounts.
  • Communicate negotiated sourcing parameters to all stakeholders, reducing process time lags and the tendency to resort to maverick buying when purchasing goods and services.
  • Reduce manual processing of orders that account for a large amount of cost, and that can leave the company exposed to unexpected liability.
  • Have visibility of available substitute goods and services and take advantage of opportunities that may exist to consolidate supply.

"With the proper support tools, effective compliance management is in fact very practical," continued Simon. "And the good news is that the tools needed are the same tools that help you to manage your procure-to-pay process - purchase-to-pay, AP automation, electronic sourcing, supplier communications and centralised contract management."



PROACTIS specialises in helping organisations deliver greater bottom-line value. Find out more at

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