Why Internal Collaboration Is a Must
Collaboration is a valued skill in the workplace, but many organizations tend to focus on collaboration among individual contributors on group projects. Collaboration between internal departments such as procurement, finance and risk management is just as important — but can be even more of a challenge.
“As new technologies that rely on organizational data continue to drive change in various industries, companies continue to be stymied by the data and process silos that exist between departments,” says Karrie Sullivan, principal at Culminate Strategy Group, which provides digital transformation consulting services.
Here’s why reducing those barriers is so important.
It Reduces Risk
Sharing information and working together makes it less likely that something will fall through the cracks. Whether you use tech tools or house departments close together so they can collaborate easily — or a combination of the two — making it easy for departments to communicate with each other will help reduce the risk your organization faces.
In procurement, every contract should have an insurance section to ensure it’s not one-sided in the other party’s favor and that it doesn’t require you to procure coverages or limits that you don’t currently carry, says Dana Gold, a risk-management consultant. “It should provide fair and equitable requirements from both parties; you need your risk manager or risk-management consultant to do this.” Similarly, the finance department should be kept in the loop regarding insurance premium projections, allocations across divisions, premium payment terms and so on, she says.
It Improves Compliance
Your policies are in place for a reason: to reduce risk and boost efficiencies. “Internal audit makes sure that policies and procedures are being followed,” Gold says. If your internal departments aren’t following the policies you have for contracts, risk to the business goes up. Removing barriers — whether physical, technological or social — between internal departments and communicating requirements clearly will make it easier for them to follow processes more quickly and accurately.
Collaboration and compliance go hand-in-hand: As you work to eliminate barriers between departments and boost collaboration, you may uncover compliance bottlenecks you hadn’t identified that may have been causing problems. For example, “every company should have requirements that relate to insurance, such as what to request on a certificate of insurance, and when to request one,” Gold says.
It Improves Operations
Your internal departments are generating data at a high rate, and that data can help you identify more efficiencies and risk — but only if you harness it effectively. As technology continues to advance, ensure that every department is providing clean and accurate data to any platforms you use to track, manage and act on these internal collaborations.
“Collaboration between audit, procurement, finance and risk is increasingly important because these new technologies will eventually rely on their data, and vice versa,” Sullivan says. “Similarly, the company’s ability to manage cash and minimize debt incurred as the company invests in innovation and growth depends on this collaboration, especially in the midmarket.”
