Administrative organizations are concerned with procedural correctness. Organizations that belong to this group favor coordinated strategic decision making and take more advantage of units of scale. Administrative organizations have clear procedures and constantly strive to gain more operational visibility to make more informed decisions, however this way of operating can be costly, stifle initiative, and lead to poor customer service.
"In our organization, all procedures and standards are clearly documented through various approval stages and steps. In regards to spend, all employees know exactly what the process is for making purchase requests."
When it comes to spend culture, administrative organizations are all about making sure spending is tracked, controlled and made accessible to decision makers. An administrative organization strives to get the most of the money they spend by analyzing how money is spent in their organization however this can lead to bureaucratic regulations, frustrating processes, and can make the team unable to react to unexpected opportunities.
Administrative leaders are quick on their toes and are masters of mitigating risk. They are extremely strategic when it comes to making organizational decisions, making sure the cost and benefits are identified before taking action.
Natural perfectionists, administrative leaders don’t mind spending more time to make sure a task is completed correctly, with the right procedural correctness and methods.
Administrative leaders feel most accomplished when interpreting data to move forward strategically towards more substantial picture decisions.
Administrative finance teams are all about control, compliance, and having clear visibility into processes and spending.
Administrative finance teams are risk averse, which means their motto is usually “better to be safe than sorry” - most financial decisions, budgets and spend approvals come from the top. It’s not uncommon to see only a few key stakeholders approving purchases and signing off on expenses.
Organized and efficient, administrative finance teams control and monitor all purchase and expense workflows, to ensure compliance. The policies are also quite clear and accessible and apply to all departments in the company. If anyone needs to spend money in the company, they know exactly what to do and how to do it.
Before starting a project, employees must seek approval by their direct manager and propose a set budget. This lengthens the time it takes to get the gears moving, but helps maximize return on investment of the project.
Administrative finance teams are also data driven. It’s not uncommon to see them consistently run reports, whether through spreadsheets or software solutions. They generally have business intelligence tools in place which consolidate data from multiple sources.
However, due to their risk-averse and data-driven nature, sometimes the strict processes and controls cause a lot of confusion and frustration by other team members, causing rogue spending or expensing after the fact.
Similarly to the administrative finance teams, the administrative procurement team is process driven and methodical. The administrative teams often manually compile reports on regular KPIs, sometimes along with the finance team. It is not uncommon to see an ERP system or procurement software used to help analyze critical data.
Administrative procurement teams rigorously document purchasing workflows, to ensure they are unambiguous. It is often common to see administrative organizations maintain rigorous internal policy documentation (SOP) databases for almost every workflow.
Concerning purchasing, administrative procurement teams know the importance of requisitions and a clear purchase order process. All employees must submit all purchase requests to their direct manager, and larger purchases need to be approved above the command. For smaller expenses, there is also a clear expense form or policy that can be followed.
Although having a strict purchasing process allows more control, sometimes the compliance suffers. A common complaint in administrative procurement teams is “I need to get this approved ASAP, but I’m waiting on _______.” Some will turn to ordering the item anyways, and expensing the purchase later, or even worse, ordering the item on the company dime and forgetting to also document it.