Your ability to select, onboard and manage reliable and cost-effective vendors can have a huge impact on the success of your business. But traditional procurement approaches are fast becoming inefficient and lack the agility required for today’s business landscape.
To increase business agility, organizations are using low-code platforms and automation technologies to create powerful vendor management systems (VMS) to better manage their external resources and remain competitive. These systems provide a holistic view of the resources you can procure worldwide. They can also take care of traditionally labor-intensive tasks including sourcing, vetting, enquiring, onboarding, and invoicing.
Vendor management solutions help your business operate more effectively, quickly, and sustainably. It can also bring you a whole host of other benefits.
1. Greater visibility
When you automate your vendor management processes, you also track every decision and can gain greater visibility into which vendors are working for you, where they are based, and what parts of your business they support. All this is key to reducing single-source dependencies that create huge problems during periods of disruption. You’ll also be able to use this insight to reduce risk and the possibility of fraudulent activity.
2. Easier compliance
A good vendor management system enables you to ensure that your vendors are made aware of and adhere to the latest regulations and are automatically updated on any changes to avoid the risk of non-compliance. It will also keep a paper trail to aid audits, remind you of licensing expirations and help you avoid inaccurate data with a single point of entry.
3. Reduced costs
With automatic procurement, you can flex your resources to your business needs. This helps reduce any unnecessary costs and over ordering. And, by automating tasks like the consolidation of documents you can reduce administration. Your team will be able to focus on bigger business objectives, such as building strong vendor relationships and negotiating lower prices.
4. Faster onboarding
When you automate onboarding processes with a vendor management system, both you and your vendors benefit. You’ll save time and resources by reducing siloes and centralizing vendor master data. This ensures everyone in the onboarding process has access to the information needed to progress. Plus, your vendors don’t have to spend time submitting various documents and can focus on delivering the products and services your business needs.
5. Performance monitoring
Automated processes mean you can collect valuable performance data on outsourced resources. You can measure this against KPIs to ensure contractual obligations are being met. A vendor management system also lets you easily communicate expectations to vendors so that everyone’s on the same page.
6. Reporting and analytics
You can maintain a single source of truth business-wide by unifying all your vendor data in one place and synchronizing master data across systems. This data clarity can be harnessed to gain insight into spending and find ways to improve productivity and efficiency.
7. Optimized invoicing
Your vendor management system can take care of invoicing and payment processing. By automating approvals, you can ensure invoices are always paid on time, reduce administration time, and ensure that reconciliation reporting is accurate.
Better vendor management can help you manage labor costs, increase your productivity, and maximize the efficiency of your operations. It can also be as small or large as you need it to be. It’s a scalable resource that allows you to react quickly to demand, no matter how big. Want an example? Check out how DHL are managing over 1,000 vendors via their portal which attracts over 320,000 global users.
Centralizing and improving the quality of vendor data will empower your business to make better decisions. You’ll be able to get a clear picture of contracts, terms, and costs. Using this, you can find ways to optimize. Adidas are using Bizagi to do exactly that, leading to a 60% reduction in operational supply chain costs and a 50% reduction in onboarding time.
Another use for automation in vendor management is to gain insight into products being purchased from vendors. This means customers can make informed decisions about purchasing and builds trust for your business. Bunzl created a sustainability hub where vendors submit the composition of their products for complete transparency.
Implementing a low-code solution can revolutionize how you manage external vendors. You can create modern apps that are designed specifically for your vendor management needs, automating processes and creating intuitive interfaces that are accessible from any device.
To see how Bizagi can help you improve efficiency, reduce costs, and build stronger vendor relationships, take a look at our Vendor Management solutions.
