Managing vendors is a tough chore without some software to keep you organized. The goal is to have happened vendors that are willing to go the extra mile for you and your company. Finding the perfect vendor management software is not a one size fits all. There are so many different types of models out there that it really can be a bit of chore. However, once you find a software that works for managing your vendors then you will be more organized and have a better workflow.
One time, not too long ago, vendors were managed within spreadsheets or on a piece of paper and almost always separately. But now there are web apps and cloud-based solutions that are helping people manage their vendor relations. As the world becomes more and more fast-paced so does the need for having these tasks combined into a software solution that just works. These solutions should be scalable and be able to grow the business with you.
What is Vendor Management?
We assume that you know what a vendor is, a vendor is a person or business that provides a product or service to another. A vendor can be anybody that fills the need for something that cannot be filled in house. These sorts of people are contractors, creatives, supplier and manufacturers. Using vendor management tools you can coordinate the entire relationship that you have with all of your vendors in one spot.
Many times there are several vendor components that go into one particular product. And, to get to the final product you have to have all the vendors parts in place. Having a vendor management system helps you with this. This is a place where all the communication between the company and the vendors can be documented from all the employees throughout the building. A vendor management system is usually extremely cost-effective in keeping everyone on task and everything running smoothly.
The Acronyms of Vendor Management Software
When you are looking into the vendor management systems you may notice a lot of acronyms that are used across the board with these systems. These are:
VOP: Vendor on-premise. This is when the company is having some growing pains or has a huge need for staff for a short period of time. These are usually things such as temporary agencies that can fill those on-demand needs with ease. Or other vendors that a company sees its benefits to bring in.
VMS: Vendor management software or vendor management systems.
VMO: Vendor management office. This is sometimes a stand-alone place, however, some companies put it in with human resources.
Vendor management systems started out in the automotive industry. As the automotive industry went more and more global there was a need for them to keep things in one place for all their vendors. This was all done manually but eventually, in the late 90's it did get some automation. As the growth of the internet expanded and the use became more and more common VMS systems started to find their way to the internet where it was vastly easier for everyone. By 2002 there were more than 50 internet-based VMS and that number was growing. People we delighted in these systems and they further helped production stay on task.
Single Management Software Tool
Fast forward to today and it is estimated that 72% of all companies use some form of a single management software tool. However, companies don't just need another tool, but they need a tool that will work with the other tools that the company already has in place. There are so many tools used throughout a company from inventory management to accounting and everything in between. The VMS should work with the existing tools so that there is not some sort of break in the system. Everything should be easily accessible as well. You should be able to entire this tool from a simple browser, phone, or app so that it is available everywhere.
The VMS is meant to streamline their systems. And, it is meant to make things better and easier. This system should allow you to assign tasks to vendors, adding deadlines and expectations. But, it is also the place where you communicate with your vendors so everyone understands and is on the right path.
Benefits of VMS
In the global economy, the right VMS can help companies work efficiently, save time and money and handle the details effectively. Some of the benefits of VMS are:
- Reduction in time to hire timelines
- The requisition approval process that is streamlined and transparent.
- Improved management of vendors and their work.
- Administrative processes are standardized with tax forms, filing resumes, IDs and certifications.
- Critical paper trails and tracking of case audits.
- Insight into a vendor, supplier, and contingent workforce performance.
- Offers a portal for contractors to communicate through
- Compliance assurance and migration risk management
Things to consider when looking for a VMS
And, there are special things that should be considered when looking into vendor management software. Ensure that your vendor management software provides:
- Time management
- Expense management
- Handles and processes requisitions
- Handles payroll and invoicing
- Provides a quick look at a vendor's performance with tailored analytics and dashboards.
- Management of candidate information, vendor company information and vendor information.
- Consolidate billing
- Scale with your companies growth
- Create predictive analytics to help with worker behavior, staffing needs nd market trends.
- Have onboard tools to help with scheduling drug screenings and other needing employee things.
- Is customization a possibility if needed.
If you are managing many vendors or are a globally large company than a vendor management software like https://www.ivalua.com/solutions/process/strategic-sourcing/supplier-management/vendor-management-software/, obviously makes sense. However, if you are a smaller company, say, SEO company with many freelancers and others that you outsource too, vendor management software makes sense for you as well. It is a great way to keep things organized. After all, a large SEO strategy may have a lot of working components and needs something that will easily manage them. So, there are a lot of companies that could benefit from vendor management software. Just when looking at the VMS be sure that it will work with your current systems and not make things more complicated.
