Some of the irritations that procurement professionals face in their daily work are very easily avoidable.
With a bit of thought and the right software platform, a lot of busywork and unnecessary admin can be eliminated or simplified. One such example is the vendor intake process.
My guest this week is Nick Verkroost, COO of vendor onboarding and master data management solution OCG Software, about keeping things simple and the hidden value in robust vendor master data.
I walk through some of my personal frustrations from the corporate world of how inefficient the vendor onboarding process is, through a mix of poor communication, excessive compliance requirements, vendors not following the process right the way through to internal routing of approval workflows being broken.
Onboarding a supplier should take a day. In reality, many corporate procurement teams tear their hair out with inefficient, Excel-based processes that take weeks to add new vendors into their system.
The age-old tale told by stakeholders to their suppliers because of the painful vendor addition process that takes far too long.
Nick describes the desired end state as:
"We need to create a mechanism by which you as a customer and me as a supplier can exchange master data in a very seamless and fluid manner; highly secure, fully auditable but also with a process which we've all understood fully aligns with how you want to onboard a supplier into your organisation".
Each individual piece of tech has the requirement to onboard or input supplier data. Be it ERP systems, e-sourcing tools, P2P software or risk management solutions.
None of them are harmonised. Each of them requires different attributes of vendor data to enable them to function. But none require a uniform, comprehensive set of criteria which fulfil an organisation's compliance and vendor due diligence checks, as well as the data required in order to pay invoices and transact with the supplier day-to-day.
However, where they've seen the most success in terms of evolving customer acquisition trends and where they're focusing most of their marketing efforts nowadays is with SMEs and the mid-market. This market segment generally is more dependent on Excel-based data and sees the bigger payback in relative terms.
Being able to give these types of businesses the ability to see a more holistic view in one single source of truth when it comes to due diligence documents on risk and CSR, on top of just pricing and contractual terms, has a huge invisible value vs. this data being stuck in silos.
The pandemic, and the ensuing crisis management, laid bare the gaps that exist in a lot of vendor master data. Something as simple as missing email addresses and incorrect phone numbers meant that it was impossible to contact suppliers quickly and en masse to manage an emergency situation.
Poor master data can also lead to:
