Prime Advantage has invited industry experts to share insights on achieving manufacturing and business success. In this post, Stephanie Dula, Communications Manager at PayStream Advisors discusses strategies for better corralling procurement data.
Today’s procurement professionals are seeking new ways to gain visibility into the massive transaction volume that accompanies digitized business processes. In an ideal world, this data is visible, meaningful, and actionable. But we don’t exactly operate in an ideal world. Much of the data challenges that operations wrestle with are related to their supplier networks. In fact, poor data management ranks as the number one obstacle to smooth supplier relations according to PayStream Advisors.
In the manufacturing industry, there are specific compliance challenges that make this data management especially time-consuming. These challenges will only multiply as globalization intensifies. To meet all government invoicing, tax, and legal requirements, manufacturing organizations must establish controls for onboarding international suppliers. These controls often take the form of many different documents and spreadsheets, as well as lengthy email chains.
Many organizations are now utilizing supplier management solutions with native document management and risk assessment questionnaires that help streamline the qualification process. Some software solutions offer third-party supplier screening tools as well, which helps offload much of the tedious fact-checking that accompanies this critical task. Once a supplier is successfully onboarded, supplier information management platforms can store and manage all relevant supplier materials, documentation, and credentials. Buyers can easily search and retrieve relevant information, including any forms and documents obtained through email.
To drive savings and long term-collaboration within your supplier network, it may be necessary to supplement your legacy system with some of the modern tools mentioned above. But it’s important to pace yourself. It’s easy to bite off more than you can chew in a growing technology market with dozens of automation solutions aimed at supplier relationship optimization. Much research on supplier network management automation has reinforced the importance of measuring processes against how they align with business goals, and making improvements before implementing a new tool. The last thing anyone wants to end up with is an accelerated version of the same risky manual process.
Take the time to step back and ask some ‘big picture’ questions. For example, is your supplier risk policy fully flushed out, well documented, and communicated? How do you go about vetting suppliers today? What data do you need about your suppliers to make better strategic decisions? What’s working well and what’s not? How much risk are you willing to accept for the sake of speed and efficiency? Once you’ve done some internal work and established some quality guidelines for assessing suppliers, you’ll be prepared to put tools in place to standardize pieces of vetting and registration process.