Vendor Management Software and the Power of a Portal
Vendor Management Software : Giving your vendors an efficient, personalized experience at all times is critical to building strong, long-lasting and mutually-beneficial relationships.
The ability to communicate and collaborate effectively pays dividends when it comes to improving vendor performance, maintaining third-party compliance and realizing the agreed benefits from your existing contracts.
Organizations that are still communicating with their vendors solely through channels such as email can face a number of challenges including:
- High levels of manual effort to capture data and complete vendor records
- Fragmented and incomplete vendor data that the business can’t have confidence in
- Difficulty tracking communication history, finding messages and escalating issues
- Bottlenecks and delays when onboarding vendors or routing approvals
In this article, we take a look at five reasons why your business should manage vendors with a dedicated Vendor Management Software rather than relying on email.
Five Advantages Of A Vendor Management Software
1. Centralised and secure vendor records
Communicating via email may seem practical at first – especially if your business only has a few vendors.
However, when your business starts to scale and add headcount, or its vendor base becomes more complex and more distributed, records and communications can quickly become fragmented as important data and documents are sent and received via different inboxes.
When you put a vendor portal at the centre of your vendor management processes, you create a hub for all activity that links directly to your vendor repository. With that in place, your organisation can securely request, receive and store information directly from vendors as well as managing all future communication and documentation.
By moving vendor communications from your inbox and centralising them in a contract repository, you can make accurate and informed decisions about your vendor base at any moment – especially useful during periods of consolidation of negotiation.
2. Improve vendor tracking with standardised, visual processes
When individuals throughout your organisation manage and collaborate with vendors on their own terms, it leaves scope for inconsistency.
Without standardisation, vendor management processes will differ each time you come to onboard a third party, capture their data or route approvals.
Inconsistent processes can cause hidden bottlenecks in the early stages of your vendor relationships – risking tensions from the outset and, at worst, leaving vendors unwilling to fulfil their contractual obligations.
3. Encourage vendors to self-serve
How much time does your organisation spend initiating contact with and chasing vendors for information?
Outside of a Vendor Management Software, time spent chasing third parties can quickly add up. Particularly if your team is required to manually request:
- Update to documentation, such as insurance certificates, for compliance reasons
- Information about stakeholders, key dates or obligations
- Scorecards and performance reports
This level of administration can create an excessive, low-level workload for your team that prevents them focusing on more high-value work.
4. Be audit ready
Whether your audits are internal or external, you need to have up-to-date vendor information that is easy to access. Managing your vendors through email makes this incredibly hard to do as you’ll need to dedicate time to finding, downloading and organising compliance documentation ahead of an audit.
5. Never miss another renewal
Manually tracking key dates can become cumbersome as your vendor base grows and can introduce financial risk and delinquent spend to your organisation. It’s vital to:
- Record all key dates correctly
- Avoid unwanted and unexpected auto-renewals of agreements
- Consolidate where multiple vendors are being paid for comparable services or goods.
- Prepare fully for renewals ahead of time so that you can negotiate from a position of comparative strength.
Communicating and collaborating with your vendors through email, or other unstructured communication channels, can work as a quick solution, but this method will fail as your business scales and your vendor base grows. Storing messages, documents and actions within your inbox can soon lead to fragmentation that’s heightened by a lack of standard processes.
Using a Vendor Management Software provides a personalised experience for your vendors while putting you in complete control of their onboarding, registration, performance and data.