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SECRETS FOR PO SUCCESS
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Control Issues:
All About Accountability
Clients & Profits
allows anyone in the company to write purchase orders.
Just what a staff member can and can't do with purchase
orders is determined by their access privileges, which
are set by a C&P system manager. Each staff member
has his or her own settings for:
PO
dollar limit A staff member can be limited
to only adding purchase orders up to a preset
order amount. For example, junior creatives
might be limited to ordering no more than $500
at one time, while a production manager would
have a high limit to allow for large printing
orders. If a user tries to order more than
their limit, Clients & Profits will display
a warning and prompt them for a lesser amount.
Users with a zero limit can't access purchase
orders at all.
Require cost amounts Anxious staffers
sometimes issue the PO before getting the vendor's
quote, which leaves the accounting department
in the dark about the order's cost until the
invoice arrives -- with usually shocking results.
This option, if checked, forces a staff member
to enter a cost amount before the PO can be
printed.
Can't
change PO amounts This option prevents
users from editing the amounts on saved purchase
orders. It keeps people from changing amounts
after the fact, presumably after the PO was
approved.
Can't delete other's POs This option
prevents finger-pointing if a PO suddenly disappears.
If checked, only the staffer who added a PO
can delete it.
Approving
POs Certain staff members can be designated
to approve POs. Orders that are approved online
will be printed with the approver's signature
automatically. (Not available in Clients & Profits
Classic.) |
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By Donna Lynn
Johnson
Half of ad agencies surveyed don't use purchase orders when they buy
from vendors. What does the one half know that the other half doesn't?
It's all about control
No one likes to give up control, especially creatives
and account executives. But purchase orders don't just benefit the bean counters
in accounting. POs give production and account service a more complete picture
of the job's true profitability anytime they want it. Because POs account for
costs that have yet to be billed by vendors, job reports more accurately show
amounts that have been spent -- and what budget remains.
"Without POs," says Ethan Goller of Structural
Graphics, "how else can you control your costs?"
While most people won't argue with writing POs
for expensive purchases like printing, the idea of issuing purchase orders to
vendors for everything the shop buys seems insane.
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But,
as any good bean counter will tell you, it's the only way to
know a key value: what the agency has committed to spend for
their clients.
Purchase orders are an integral part of running
a professional agency that plans to stay in business for the long term. Without
a company-wide purchasing system based on the shop's work flow, the risk of expensive
mistakes is too high. "Using POs," says Kim Snider of On Fire Design, "has saved
us 100 times over."
(Almost every large company won't pay an invoice
unless it has an accompanying purchase order. This puts the burden on vendors
to prove what is being billed was what was actually ordered, and is very effective
at preventing fraud.)
Using Clients & Profits to manage purchase
orders helps control both staff members and vendors for a very low cost. (You'll
find a step-by-step tutorial here).
Donna
Lynn Johnson is a former CFO and a leading Clients & Profits
consultant. |
Your entire shop pulls together when everyone
knows what to do and what their PO cost limits are. POs help keep
your outside costs controlled.
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