February 5th, 2019 • Procurement Process • Vendor Management
Vendor management is one of the most complex and sophisticated processes in the whole of procurement process. It can seem simple when the number of vendors is small, but the complexity ratchets right up as the number of purchases gets higher.
This herculean task could be simplified by using a powerful vendor management software to manage, monitor, and engage vendors efficiently. However, there is an array of vendor management products in the market today.
To select the perfect vendor management solution, organizations need to determine the business requirements and identify what functionalities they need to coordinate better with their vendors, to save costs.
Here’s all you need to know to create a powerful vendor management process with automation.
Vendor management is the process of analyzing, segmenting, and managing suppliers, an integral part of the procurement process. This process optimizes the way an organization interacts and collaborates with its suppliers. A vendor management strategy is based on the specific business requirement of an organization and the value it desires to extract out of the relationship.
The vendor management ‘process flow’ refers to the steps involved in creating an effective relationship with suppliers. Here are the four steps involved in a vendor management process flow:
Getting the segmentation right is an essential part of the vendor management process. At this stage, you classify vendors based on a number of metrics like risk, profitability, total spend, the volume of transactions, quality of products, performance, and more.
Traditional vendor management practices focus on price negotiation. To unlock more value from a relationship, buyers need to broaden their focus. By working together with their suppliers, businesses can take costs and risks out of the bottom line while driving value and innovation to the top.
Organizations can execute their vendor management process efficiently by tapping into supplier capabilities to create mutual value. Buyers and suppliers can engage in activities like cost optimization, quality management, relationship building, innovation, and risk management.
The final stage of the vendor management process flow is about measuring performance to check whether you have bet on the right horses. Use your development plan to check your progress with the set targets. Discuss with your vendors on improvement actions or plans to meet evolving needs.
Vendor management tools provide a unique set of functionalities that can do wonders to improve a supplier relationship. Automated management systems offer a comprehensive dashboard, pre-defined templates, online forms, digital forms, and built-in analytics tools to track vendor performance effectively.
Organizations don’t need an expensive procurement suite to automate their vendor management process. A simple procurement automation tool like KiSSFLOW can streamline all stages involved in a supplier relationship management process.
Here’s how you can create an automated vendor management process with KiSSFLOW in four simple steps.
Organizations can create a brand new vendor management app from the ground up using KiSSFLOW’s drag-and-drop form builder, or by installing a pre-defined template. You can auto-populate fields, add tables, and use computed fields to build a foolproof form.
Design dynamic workflows that enforce accountability and compliance at every step of the vendor management process, from vendor segmentation to supplier performance management, transparently.
Organizations can mitigate risks and safeguard their data using functionalities like conditional visibility, role-based access, and more. KiSSFLOW gives businesses the power to customize permissions, create policies, set approval checkpoints, and establish dependencies.
After the initial test, the app can be published in a single click. Once the app is up and live, businesses can retrieve the status of the vendor management process at a glance.
Vendor management is a demanding process, but deploying it adeptly can create enormous value for the business. A good vendor management process:
Ideal vendor management solutions that is best suited to your business needs must include these features:
A good vendor management suite will offer an easy-to-use interface to develop and visualize the journey of a supplier relationship. Even business users who don’t have coding expertise can create a workflow easily.
Users can build powerful online forms quickly with an intuitive drag-and-drop form builder. The form builder must offer an exhaustive range of fields and a good collection of predefined form templates that users can choose from.
A cloud-based vendor management system gives buyers the ability to access it from anywhere at any time. With 99.9% guaranteed uptime and a centralized database, the vendor management process will be more efficient and streamlined.
Your supplier relationship management software won’t work in a vacuum. It needs to interact seamlessly with other procurement tools that are used by your business. Take a look at what systems your software needs to connect with, and then pick a compatible solution.
Despite the undeniable benefits of the cloud, several businesses hesitate to fully embrace cloud technology due to security concerns. However, cloud-based vendor management software mitigates risk with features like conditional visibility, role-based access, and more.
Vendor management suites need powerful reporting features that help organizations stay on top of their operational metrics. Users ought to be able to retrieve the desired analytical insights on vendor performance, quality, and more whenever they want, with very little effort.
By properly segmenting your supplier, collaborating with them regularly, and implementing the devised strategy through KiSSFLOW, you can level up your vendor management process.
An ideal vendor management solution will provide organizations with the insights they need to monitor, manage, and improve vendor relationships. With KiSSFLOW, organizations can establish a smooth vendor management process within minutes.
What’s more? It’s a pocket-friendly pricing model and an extensive list of features makes it the best fit for organizations of all sizes. Get a sneak peek of how KiSSFLOW makes vendor management process a breeze.