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How To Improve Supplier Management Through Technology
Managing a high volume of suppliers across various companies has always presented businesses with a host of challenges. There are a lot of risks associated with limited visibility and manual processes vs outside supplier management solutions. A large number of businesses today are still using spreadsheets to manage suppliers and vendors, and the limits of spreadsheets make it harder to manage these risks.
Technology continues to grow but some vendor onboarding processes are hopelessly behind the times. This can leave employees scrambling at the last minute to ensure they have the necessary paperwork, like W-9 forms or insurance certificates. Things just get more complicated as your company grows and you form relationships with an increasing number of vendors. In addition, large vendors with multiple addresses are difficult to manage and frequently get duplicated.
Having a disorganized supplier management system can create huge headaches all over your company. You’ll have to deal with problems from receiving and inventory management, to account reconciliation, to cost center and general ledger allocation. These sorts of problems aren’t inevitable, though. You can improve your supplier management practices through the use of modern business process automation technology.
Your ERP Isn’t the Best Solution
The first impulse to get a handle on vendor information is usually to modify an ERP system. But often, the challenges outweigh the potential benefits.
Making changes to your ERP configuration requires a large project which typically includes outside consultants and programmers. Even with the right team, some systems just won’t be able to meet the requirements you have—whether its accessibility, or reporting, or a need for more data.
For example, many ERP systems only have room for one point of contact in an organization unlike outside supplier management solutions. In daily operation, contacts frequently vary by department. Depending on why the buyer is getting in touch with your company they’ll often need to speak to different people, such as the AP manager or the receiving manager.
Simplifying access to all this data has the potential to streamline otherwise cumbersome processes in supplier management. However, your ERP system isn’t the best choice to accomplish this.
The Benefits of Supplier Management Process Automation
So how do you make the changes needed to your supplier systems? It may seem counter-intuitive, but moving to a new program is often the best way to revive problematic vendor onboarding. In many cases, implementing a new solution is much easier than trying to fix the one you have. Plus, a new software solution can add helpful features you wouldn’t have access to if you tried to stick with what you already have.
Business process automation software is your best bet for improving supplier management through technology. Often when talking about process automation, people focus on how it can improve specific business processes. On its own, accounts payable automation speeds up invoice processing, reduces errors, and saves money. Purchasing software by itself streamlines and standardizes how you place orders. Used together, they can improve how you manage your overall supply chain.
Business process automation software helps your company improve management of every aspect of your side of the supply chain. You’ll be able to easily compile a searchable database of vendors. You can manage all your information through one central program that’s accessible from all your locations. And if you automate both purchasing and accounts payable, the programs can work together to streamline the process of making purchases and paying for them.
What to Look for in an Outside Supplier Management System
More and more companies are finding that an outside software supplier’s system is the best way to improve vendor management. These systems often offer more flexibility for supplier organization than you can accomplish on your own. Here are some key features to look for when considering an outside system:
- Multi-company Management: If you deal with multiple legal entities or entirely separate companies, streamlining your vendor lists can be twice as frustrating. Having a system that’s flexible enough to manage your corporate structure is invaluable.
- Outbound Communication: Being able to quickly and easily contact suppliers about specific invoices or missing pieces can greatly improve your internal organization. The software can also automatically identify vendors with missing information and notify them to submit corrections.
- Effective Onboarding Management: Find software with a predetermined program for requesting new vendors. Make it flexible enough for employees to request vendors as needed while maintaining your company’s standard controls. Letting software automate more of this process substantially reduces guesswork and duplication.
- Data Analytics: Once you have all of your data together, it only makes sense to maximize your analytics. Find a software supplier that can integrate with your ERP and harvest data from purchasing, payables, and more. You can request reporting on pricing across different locations and suppliers to find the best deals. You can also use this detail to try and consolidate the number of vendors on your list and create a more manageable purchasing process.
- Supplier Self-Service: Automation can improve your relationship with vendors and suppliers. If you use a program like the ones we offer here at NextProcess, you can set up a vendor self-service portal. This makes it easy for your vendors to update their information, submit missing paperwork, and look up answers to their customer service questions.
Why Choose NextProcess
NextProcess offers everything you should be looking for from software integration. In addition to the features we’ve already talked about, NextProcess is committed to making your software implementation go smoothly. Unlike with many other software companies, you won’t have to worry about any hidden fees or other issues cropping up during the implementation process. We’ll help you get everything up and running, customize our software to meet your needs, and make sure your employees are comfortable using our system.
Supplier information management can be difficult to tackle for any organization. It’s a necessary task, but one that’s easy to neglect. Thankfully, there’s an easy fix. Working with a SaaS provider like NextProcess means that someone is constantly looking for ways to help you improve your vendor relationships. Simply contact us today to find out how you can transform your vendor management quickly and easily.