While it's important to connect the supply chain to finance, all company functions and departments must be linked, says Reggie Twigg, supply chain marketing lead at Anaplan.

As the “heartbeat” of a company, the supply chain impacts every part of a business, from finance to human resources and workforce planning, Twigg says. For example, a retail operation must plan its labor around product and what it has in stock. At the same time, “It's important for the supply chain to coordinate with sales and marketing, because that actually creates the product flow, which creates the movement to your customers.”

“Ultimately,” Twigg says, “for many organizations, supply chain is the biggest business variable they need to manage. It’s the biggest source of revenue, cost and profitability for the organization. They need to get visibility into it.”

While every company function is affected by the supply chain, Twigg says finance is probably the “biggest stakeholder” in an organization’s supply chain planning. “The cost performance — what you report in your financials — is deeply impacted by supply chain,” he says. It’s counterproductive for companies to operate in silos when supply chain plans are being decided.

“Where is finance in those decisions when they're being made?” Twigg asks. “Where is finance in the planning cycles? Innovative organizations have recognized that those two functions need to be very tightly interconnected, because one of the biggest costs that an organization can have is in supply chain.”

Addressing supply chain risk, Twigg asks, “Where is that felt? It’s felt primarily by finance. If you have missed revenue opportunities, or if you have unexpected costs that you have to deal with, there needs to be visibility between those two functions in order for the stakeholders to be able to align and to adjust strategy.”