Where Should Procurement Report in Growth Companies?

So, where should procurement report into? In growth companies especially, the reporting line isn’t just about org charts. It fundamentally shapes what procurement can achieve in your business.

Large enterprises have established patterns.

• Services businesses typically place procurement under the CFO.
• Manufacturing companies favour the COO or SVP Supply Chain.
• Tight-margin businesses with high direct spend—automotive, FMCG—often have the CPO reporting directly to the CEO.

Growth companies face a different challenge. These enterprise patterns don’t always translate when procurement is still finding its feet.

The wrong reporting structure turns procurement into a bottleneck. Or worse, it becomes a box-ticking cost-cutting function that adds friction rather than value.

• We’ll examine four main reporting options through real practitioner experiences.
• We’ll look at how growth stage changes the equation.
• And we’ll explore why the CEO reporting line can be a poisoned chalice for immature procurement functions.

The answer depends on procurement maturity, growth stage, and spend profile. One size definitely doesn’t fit all.

Why the Reporting Line Matters More Than You Think

The question of “where should procurement report?” determines both procurement’s strategic scope and influence.

• The CFO line typically drives a financial focus.
• The COO line pushes operational priorities.
• The CIO line emphasizes technology value.

Each creates different constraints and opportunities.

Growth companies need procurement to be agile, not just compliant. Wrong structures create misaligned incentives. They generate missed opportunities and frustrated stakeholders.

The maturity trap in growth companies

Growth businesses often have immature procurement functions still finding their feet.

Reporting directly to the CEO can be a poisoned chalice in this context.

CEO reporting only works when the business truly grasps what procurement can deliver. Without this understanding, procurement gets impossible expectations. Or the function gets ignored entirely while everyone focuses on revenue growth.

Better to build credibility under the CFO or COO first. Then earn elevation later through demonstrated results.

What growth companies need from procurement

Growth companies have specific procurement requirements that mature enterprises don’t face.

• Speed and flexibility during rapid scaling top the list.
• Headcount doubles.
• Office locations multiply.
• Technology stacks expand.

Procurement must keep pace without creating bottlenecks.

Governance frameworks and process in chaotic operating environments come next. Growth companies often operate on spreadsheets and handshake deals. Procurement brings structure without killing momentum.

Strategic supplier relationships enable innovation. The right partners accelerate product development. They provide expertise the organisation lacks internally.

Cash management and working capital optimization matter intensely. Growth companies burn cash by design. Poor payment terms or slow invoice processing create unnecessary cash drains.

Risk management must happen without becoming a bottleneck. Cybersecurity threats are real. Regulatory compliance matters. But procurement can’t take six months to approve a critical supplier.

Data visibility across fragmented spend reveals opportunities. Growth companies acquire competitors. They expand internationally. Spend data lives in multiple systems. Procurement must create visibility from chaos.

The enterprise playbook doesn’t always apply

Mature companies have established procurement value over years or decades.

Growth companies are still proving the function’s worth. Leadership teams question whether procurement deserves headcount investment. Stakeholders wonder if procurement slows them down.

• You need to build a foundation before seeking a board-level mandate.
• Show financial impact.
• Demonstrate stakeholder satisfaction. Prove you can move fast.

Maturity must precede elevation. Earn the CEO reporting line through results, don’t start with it.

The Case for Reporting to the CFO

Finance makes intuitive sense for growth company procurement.

The CFO has direct visibility into budgets through FP&A connections. They understand cash flow pressures. They speak the language of ROI and payback periods.

Natural alignment with AP provides payment insights.

• You can see which suppliers get paid late.
• Payment term opportunities are visible.
• Duplicate invoices and fraud risks are easier to collaborate on.

This structure enables procurement to deliver critical spend versus budget reporting. Business units desperately need this visibility. Finance can’t provide it without procurement’s category expertise.

The CFO also has board-level influence for procurement initiatives. Need investment in spend analytics software? The CFO controls the purse strings. Want to hire category managers? Finance approves headcount.

Real-world validation: Dave Quillan’s perspective

Dave Quillin brings 20 years of procurement experience to this question, and he strongly prefers CFO reporting.

This structure enables procurement to provide financial insights business units desperately need. At his previous role with Vivid Seats, spend versus budget reports were high-demand items. Finance had the payment data. Procurement had the category context. Together they delivered actionable intelligence.

The model works best for indirect spend-heavy businesses. Professional services, IT, marketing, facilities—these categories align naturally with financial governance. Michelle Cleary, Eve Reiter, and Laura Barrett also shared similar experiences to Dave. Their experience comes from food & beverage, real estate, insurance, and financial services industries.

CFO reporting forces procurement to build strong business relationships. You must earn stakeholder trust through service delivery and business partnership.

The critical success factors

CFO reporting requires specific behaviours to succeed.

Procurement must build business partnerships proactively. You can’t just be “the finance police” enforcing policies. You must understand stakeholder needs and solve problems, not create friction.

Measuring value beyond cost savings becomes essential. Finance cares about cash flow and working capital, but business units care about cycle time and supplier innovation. There’s a need to track both.

Strong data infrastructure supports financial reporting requirements. Clean spend data is non-negotiable. Integration with FP&A and AP systems enables real-time visibility.

When CFO reporting fails

This structure doesn’t work everywhere.

Businesses with high levels of direct spend struggle with CFO reporting. Manufacturing companies need tight operational coordination. Raw materials and components are mission critical. Operational urgency can’t wait for financial approval cycles.

The model also fails when financial controllers only care about hard savings. Some CFOs may view procurement purely as a cost-cutting function. This creates pressure to sacrifice long-term value for short-term wins.

Procurement becomes isolated from operations under the wrong CFO. If finance doesn’t facilitate cross-functional collaboration, silos emerge. Procurement loses touch with business reality.

The Case for Reporting to the COO

Operational alignment makes sense for specific business models.

Manufacturing and supply chain-heavy businesses need tight coordination. Direct spend requires constant communication. Lead times drive production schedules. Quality issues shut down assembly lines.

Speed and execution matter more than governance in these environments. Operations won’t tolerate procurement delays, and the COO or SVP of Supply Chain understands this viscerally.

This structure works when operations is the primary value driver. Revenue depends on operational excellence. Procurement must serve operational priorities first.

Dominic Battiston reported to both COO and CFO in different roles. COO reporting focused heavily on supply chain support. Inventory management dominated the agenda. Product flow and logistics took priority. Strategic influence on broader business decisions remained limited.

The transition to CFO reporting created a more holistic role. Suddenly Dominic felt he could influence company financials broadly. The job became strategic rather than purely tactical. He could question whether the business should do something, not just how to execute what operations demanded.

Growth stage considerations: Karthik Rama’s framework

Karthik Rama is the owner of Procurement Doctors, a digital transformation business focused on tech implementations. He’s consulted across businesses in India, the Middle East and North America. He sees clear patterns across growth stages.

Early-stage and pre-Series C companies typically place procurement under the COO or CFO. The COO gives speed when chaos is high. Manufacturing startups need components yesterday, not next quarter.

Procurement gets treated as a “get it done” function at this stage. Nobody cares about governance frameworks. They want product shipping to customers.

This works when operational delivery is the primary constraint. Can we manufacture enough units? Can we fulfil orders on time? Procurement serves these urgent needs.

The limitations

COO reporting creates predictable blind spots.

Indirect spend often becomes an afterthought. Operations cares about direct materials and components. IT software and professional services? Less interesting.

Strategic categories like technology and marketing get neglected, and building enterprise-wide governance becomes harder. Operations focuses on operational spend. Finance, Marketing, IT and HR then tend to manage their own vendors. Fragmentation can then persist.

The Case for Non-Traditional Reporting Lines

Some growth companies experiment with alternative structures.

Reporting to the CIO

Tech-first growth companies sometimes place procurement under the CIO.

This makes sense when technology represents the biggest spend category. SaaS companies spend heavily on cloud infrastructure, development tools, and software licenses.

Tools get implemented faster under CIO reporting. The technology leader understands software evaluation. They appreciate integration requirements. Procurement software gets prioritized.

Data infrastructure becomes a priority naturally. The CIO values data quality and system integration. Spend analytics platforms get funded and implemented properly.

Reporting to Legal or other functions

Emily Kushvaliev has built several Procurement teams from scratch, and brings diverse reporting experience throughout her career. She’s reported to IT, Legal, Operations, and also to a CPO who reported directly to the board.

The benefits are tangible. Procurement isn’t seen as the “purse holder” or financial barrier. Building trust-based relationships becomes easier. Business leaders view you as a partner.

Legal reporting enabled broader focus on value. Cost savings mattered. But so did contract compliance, risk management, and supplier relationship quality.

This structure allowed continuous maturation of the function. Multiple facets evolved simultaneously. Procurement wasn’t pigeonholed into pure cost reduction.

The game-changing impact

Business leaders consistently noted Emily’s “different” approach compared to typical procurement people.

Procurement operated as a partner, not a gatekeeper. Multiple value dimensions mattered. Cost savings became one of many contributions rather than the only measure of success.

This perspective aligns specifically with non-financial reporting structures. When procurement isn’t under finance, the mandate naturally broadens beyond savings.

Why this can be challenging in growth companies

Non-traditional reporting structures require specific conditions.

You need a strong executive sponsor who truly understands procurement’s potential. Legal or IT leaders must actively champion the function. Without this, procurement gets marginalized.

Confusion about procurement’s core mandate can emerge. What exactly is procurement responsible for? The answer becomes less clear outside traditional structures.

How Growth Stage Changes the Answer

Growth stage fundamentally shapes the optimal reporting structure.

Early-stage / Pre-Series C

COO or CFO reporting dominates at this stage.

The COO provides speed when chaos runs high. You’re building the plane while flying it. Operational execution matters more than governance.

The CFO brings basic spend control when cash matters intensely. You’re burning investor money. Every dollar counts. Financial discipline helps you reach the next funding round.

Procurement often remains under-invested at this stage. You might have one procurement person wearing multiple hats. Or nobody with procurement in their title at all.

Series C+ / Late-stage growth

The structure typically evolves toward CFO reporting with a dotted line to COO.

• Savings become a board-level priority. Investors want to see a path to profitability, so the CFO drives cost optimization across the business.
• Governance tightens significantly. You can’t operate on handshake deals anymore.
• Compliance requirements increase, and with it process discipline becomes essential.

This represents a critical juncture. Procurement either matures into a strategic function or dies as a glorified cost-cutting team.

PE-backed / Post-acquisition

Procurement almost always reports to the CFO or Value Creation Office. The mandate becomes crystal clear: improve EBITDA quickly.

Supplier consolidation dominates the agenda.

• Renegotiate everything.
• Capture synergies from acquisitions.
• Optimize payment terms for working capital.

This creates a clear mandate with serious risks. You can pull EBITDA levers fast. But you’ll burn suppliers and capability simultaneously if you only measure financial metrics.

The danger lies in pure financial optimization.

• Supplier relationships suffer.
• Innovation partnerships end.
• Quality degrades.

You may hit your targets but you destroy long-term value.

Making Any Reporting Structure Work

Success requires specific behaviours regardless of org chart placement.

The relationship imperative

Strong business partnerships matter more than reporting lines.

You can’t rely solely on top-down mandates. Even with CFO support, you must earn stakeholder trust. Deliver value in their terms, not yours.

Demonstrate value in business terms they understand. Learn their language.

Build trust before you need it.

• Solve small problems quickly.
• Be responsive.
• Prove you understand their business.

Then they’ll engage on strategic initiatives.

Karthik’s honest takeaway is that no perfect reporting line exists in practice.

Procurement fails when leaders want control without trust. They demand approvals but won’t invest in capability. They want savings without enabling success.

Procurement fails when leaders want savings without strategy. Pure cost-cutting creates race-to-the-bottom dynamics. You need strategic supplier partnerships for sustainable value.

Structure matters less than mandate and capability.

• Give procurement a clear mandate.
• Invest in talent.
• Provide technology and tools to get the job done effectively.

Results then follow regardless of reporting line.

Conclusion

Growth companies face fundamentally different challenges than established enterprises. Procurement maturity matters more than org chart theory.

• CEO reporting is a poisoned chalice for immature functions. Build capability and credibility first under CFO or COO reporting. Elevate the reporting line later through demonstrated impact.
• CFO reporting works for most indirect spend-driven growth companies. You get financial discipline and board visibility. Success requires strong business partnerships and measuring value beyond cost savings.
• COO makes sense for manufacturing and high direct spend. Operational coordination matters more than financial governance in these models. But indirect spend often suffers under this structure.

Hybrid approaches can also work well. CFO reporting with strong dotted lines to COO and CIO provides governance while maintaining operational partnerships. Financial accountability meets operational effectiveness. Tech-first companies with high software and infrastructure spend can accelerate procurement influence through CIO reporting.

Success requires business partnerships regardless of structure. You must earn stakeholder trust through delivery. No reporting line substitutes for capability or mandate.

• Value frameworks must extend beyond cost savings.
• Measure cycle time, innovation, and risk mitigation.
• Show comprehensive business impact.
• Track both financial metrics and stakeholder satisfaction.

Build credibility before seeking elevation. Demonstrate results in your current structure. Prove you can balance speed with governance. Show successful supplier relationships and cost management.

The real question is whether your structure matches your maturity level.

Wrong structures turn procurement into cost-cutting functions. You chase savings targets while missing strategic opportunities. Supplier relationships burn and innovation suffers.

The right structures, on the other hand, enable procurement to grow with the business. You solve today’s problems while building tomorrow’s capabilities. You earn strategic influence through demonstrated value.