Managing third-party relationships is a tricky but essential part of running a modern, successful business. Most organizations today have some level of ongoing relationships with outside vendors, and keeping vendor data centralized and useful can be a challenge without the right tools. Disorganized, scattered vendor data sucks time from your team and reduces return on investment (ROI). From contracts to invoices and emails, documentation associated with vendors can pile up and cause operational bottlenecks if left to manual processes.
For these reasons and more, organizations are turning to vendor master data management to simplify and improve how they work with third parties. As you onboard more vendors and take in more vendor-related information, you need a gatekeeper for all that data. That’s where vendor master data management comes in.
What Is Vendor Master Data Management?
Vendor master data management is the practice of using software to streamline operations related to vendors, including onboarding, payment, security, and more. Vendor master data management software allows you to capture and organize your vendor data, close security gaps, stay compliant, and cut costs related to vendor management. You can use it to modernize payment processes, better vet submissions, and introduce efficiencies throughout vendor-related workflows.
The Top 5 Benefits of Vendor Master Data Management
Allowing You to Use More Data
Without vendor master data management, data related to your vendors is often in the dark — going unused. Paper-based processes, emails, and information about vendors stored on local drives or in other applications means your data is scattered, possible risks based on the type of data being stored and is not as valuable as it could be in a centralized, secure, fraud free location. When you put vendor data into software designed to help you manage third parties, your teams get easier, faster access to more data — helping you maximize all that information. You can better keep track of components like onboarding statuses, payment statuses, change requests, and more. You can also get insight into how vendor relationships are going so you can make strategic decisions about third parties you want to continue working with.
Speeding Up Approvals and Onboarding
Waiting for approvals can hinder the momentum of important vendor relationships. Vendor master data management automatically reminds the appropriate people to sign off on items to ensure workflows progress in timely ways.
Additionally, vendor onboarding can be a source of confusion and mishap without an automated method through which both you and your vendor know how to complete the next steps. Vendor master data management ensures a smooth onboarding process through a vendor form specific for your business so every step is complete before a vendor begins work. You’ll also eliminate onboarding redundant vendors that provide similar services.
With manual methods of managing vendor data, your teams waste time — and therefore money — searching for information, backtracking on workflows, and even using the wrong data, which results in errors. Vendor master data management enables you to remove the chaos from the operational components associated with vendors. Your processes will be faster, more organized, and more efficient — cutting costs for your organization.
Keeping You Compliant and Secure
Vendor master management software allows you to optimize payment for all vendors so your organization doesn’t have to hold onto sensitive banking information, potentially compromising you and your vendor. The software also monitors for fraud in an ongoing manner, ensures security for all payments within the platform, and allows you to set permissions so only the right parties can view the correct information. From a compliance standpoint, the software enables you to track approvals and document version histories so you’re always ready for an audit and monitor regulatory adherence.
Making Data Clear and Consistent for All Users
Manual methods of managing and communicating with vendors can result in employees deciphering emails or paper with illegible handwriting. Vendor master data management enables you to control how information is submitted and stored in your organization, it centralizes communication into one platform. Your employees can easily keep track of vendor data without having to go back and forth with a vendor about physical notes or emails.
Optimize Vendor Relationships, Costs, and Work Today
If you’re curious about how vendor master data management can drive up ROI and transform how you manage vendors, contact All Star today.