No Vendor Data Management? Then You’re Behind…
Managing vendor data can be a nightmare. And if you're trying to focus on growing your business, the last thing you need to do is waste time hunting down supplier information in a spreadsheet. You've got better things to focus on. And this is where vendor data management software comes in handy.
This innovative software solution effortlessly consolidates information from multiple suppliers onto a single platform, saving you hours of valuable time each week. That means you'll spend less time collecting information and hunting around for insights while getting more time to grow your business.
An Overview of Vendor Data Management
But how do you get started? After all, automating systems is easy to talk about and a lot harder to implement. As procurement professionals, we have a lot of experience automating supply chains for organizations. And we're here to walk you through automating your vendor data management with accessible software solutions.
This guide is intended to help your business rapidly set up and deploy vendor data management software that'll give you the edge.
It will walk you through each step of the process, from finding a suitable solution to getting started and making the most of your investment.
What can you anticipate from this guide? We’ll:
- Define vendor data management software.
- Explain why it's useful for your company.
- Show you how to find the best solution for your needs.
- Explain how you can choose the right solution
- Discuss an easy way to implement the best vendor data management solution
What Is a Vendor Data Management Software?
Vendor data management software is designed to help businesses keep track of their vendor relationships and performance.
Vendor data management software transforms your business processes by moving your organization away from manual data collection methods, leveraging ROI-heavy benefits of automation. In short, you can wave goodbye to haphazardly collecting vendor data with emails, spreadsheets, and wpritten notes that you can never find.
Instead, these platforms centralize your data into one platform and automate many of the manual data management processes. This includes automating how your organization collects contact information, stores contracts/legal documents, records performance metrics (and other important KPIs for your vendors). You can also automate invoicing and store payment data for more accurate budgeting and forecasting.
Turnkey vs. Custom Vendor Data Management Software
While vendor data management software can save you time and money, it's still important to see adopting any new business solution as an investment. Whether or not you want a turnkey solution or you want to build a custom solution depends on how much you're willing to invest and what your goals are.
There are positives and negatives for both.
Turnkey solutions are often cheaper. You can quickly purchase and deploy them. Plus, they come with a range of features. However, they won't be made for your business. As a result, you'll likely get features you'll never use. And you'll miss out on other features.
Custom solutions are usually more expensive. But, they are designed specifically for your business. The downside here is more risk. You'll also need to get the most out of your investment, so you may rely on these platforms longer past their prime.
An alternative solution is to use low-code to build the custom vendor data management solution that you need. Low-code platforms let you rapidly build custom applications using a "drag and drop" visual interface. This allows you to rapidly build custom vendor data management systems without burning through your budget.
We specialize in building low code procurement systems for organizations of all sizes using low-code. You can see some of our work here.
6 Benefits of a Vendor Data Management System
On the fence about whether or not you need to upgrade your existing process with a vendor data management system? These benefits will help you understand why your business should make the change.
1. Cost Reduction
If you're like most business owners, you're always looking for ways to save time and streamline your operations. In today's world, that means leveraging automation to reduce menial tasks and speed up processes. And that's why so many businesses are turning to vendor data management software. It helps automate most of the process.
Automating vendor data management effortlessly consolidates information from multiple suppliers into a single location, saving you hours of valuable time each week. That means less time spent on menial tasks and more time to focus on your business.
2. Risk Reduction
Every human touchpoint in your workflows opens your business up to risk. With managing vendor data, a small data entry error could grind your production to a halt.
Typing in the wrong number, data, or some other vital piece of information could result in a delayed payment that damages a vendor relationship. Or, it could mean that you send a delivery to the wrong address.
Errors cost your business time and money while putting you at increased risk. Thankfully, vendor data management systems automate the process, removing people from the equation and helping you reduce potentially problematic situations.
3. Better Vendor Relationships
Managing vendor relationships is impossible without accurate data. And it only gets worse if your vendor communication is all over the place (emails, mail, phone calls, text, etc.). With so many different platforms, important messages get missed. Mistakes happen. Relationships grow strained.
It can also be really hard to establish a baseline of vendor performance with your data all over the place.
Vendor data management systems consolidate your data and communications. This makes it easy to track vendor performance and communicate with your vendors. For those who are underperforming, you can reach out proactively with the data sets you need to get them back on track.
4. Improved Reporting
Hunting down information across multiple mediums is a time-consuming, headache-inducing experience. Spreadsheets aren't exactly fun to look at either.
Vendor data management systems create user-friendly databases for real-time, accurate reporting. No more pulling data from various spreadsheets and trying to combine it into a uniform report. Instead, you can get a transparent overview of your supply chain at a glance.
5. Easier to Use
When you have numerous different systems for collecting data information, onboarding new employees is extremely challenging. However, onboarding is often much easier with vendor data management systems.
If you choose a turnkey solution, you'll often work with a team or follow a tutorial that will help your team learn the new system. After that, everyone's consolidated on the platform, making it much easier to manage.
Alternatively, if you choose a custom solution, you'll need to work with a change management team to get your staff up to speed on the new system.
Either way, you'll have a single system that everyone can learn how to use quickly.
6. Fewer Time-Consuming Tasks
Vendor data management software automates most of the data management processes, giving you more time to focus on your business. For example, your team won't need to manually collect vendor data. Instead, they can create a digital form your vendors can fill out that automatically submits the data into your system.
Plus, with all your data in one system, you won't have to waste time hunting down documents. Because everything is centralized in one system, your team will know where to go to find the information they need.
Transitioning to a Vendor Data Management Platform
You're not alone if you feel overwhelmed by the idea of automating your vendor data management. While the benefits are clear, there's still risk involved in switching to a new system, especially while balancing the management of your business. These steps will help make the transition to a new software solution easier.
Step 1: Assess Your Needs and Goals
What specific features do you need from your vendor data management software? You can figure these out easily using the MoSCow method (Must Have, Should Have, Could Have, and Won’t Have). This will help you narrow down what kind of solution you need.
Step 2: Do Your Research
Research the vendor data management solutions out there. Look up what they offer. Review their pricing. And see what kind of onboarding support they provide. You also want to check out reviews and testimonials.
Once you've narrowed down the platforms, you can email software providers. Ask them any additional questions you may have. See if they have experience deploying their solution in a business that's similar to yours.
Most importantly: Do not be afraid to ask questions. The more detailed and extensive, the better. You don't want to assume your way into being stuck paying for an inadequate vendor data management system.
Step 3: Ask for a Demo
Once you have done comparisons and narrowed down your choices, request a demo of the vendor data management software. You want to see if it's a good fit for your business. Be sure to ask plenty of questions during the demo, too. This will ensure you understand exactly how the software works and what it can do for your business.
Step 4: Consider Technology Consultants
Most business owners don't have the time to vet new software solutions for their business. They're focused on improving the core offerings of their business. A simple solution is to team up with a technology consultant who can help you deploy the right vendor data management solution for your business.
Step 5: Take the Leap
Once you've done your research, established your goals, explored solutions, and narrowed it down, you're ready to make a decision. Whether you choose to build a custom vendor data management solution or you choose a turnkey one, you'll be on the path to drastically improving your vendor management processes.
See how we've helped our clients improve their businesses and get insane ROIs by checking out our case studies below.