"When auditors come into a company, the first thing they do is to ask for an inventory of processes. That's fine when it comes to finance, manufacturing, human resources or sales. But marketing usually does not have processes," he says. "Without formal processes, the auditors can't examine them or suggest any changes."
In addition, many companies do not track marketing expenses as closely as they should, Saiya says. Yet marketing typically accounts for a sizable chunk of a company's expenses.
"The way marketing operations are managed, companies have no idea of the marketing costs accrued in a given month. There is a likely variance of 20% and, when you look at the overall expenses of a corporation, this can result in a 3% to 8% variance in the accuracy of overall financial results," he says. "A 5% variance can easily gobble up the net profits of a corporation."
With CEOs and CFOs of public companies expected to attest to the accuracy of their companies' financial statements in order to satisfy Sarbanes-Oxley requirements, in the US for example, such uncertainty is becoming increasingly unacceptable, Saiya says.
He recommends introducing formal processes to help control how marketing organizations plan, budget, expense and execute their marketing programs. With processes in place, the next step is to track and manage them. Automating management will not only ease compliance efforts, but will also likely result in streamlined and more efficient marketing operations, he says.
You can read the full interview with Saiya here:
http://www.itbusinessedge.com/content/3Q/3qpub9-20051020.aspx.
