Vendor Onboarding Trends in 2023: Prediction #3
Experts Weigh In On Vendor Management Trends in 2023. Part Three of a Three-Part Series.
Today’s third and final 2023 vendor onboarding prediction harkens back to my original beef in our first prediction blog.
Simply put, vendor management doesn’t get the respect it deserves across the entire organization.
Too often, the work being done to ensure vendor payments and compliance is seen as a logjam to business. It’s not viewed as the strategic support function that it truly is.
Let’s go to the illustration below.
The PaymentWorks team created this image to illustrate the foundational issues that exist in almost every vendor management strategy we see.
These issues make it harder for procurement and accounts payable teams to convey the importance of vendor management throughout the organization.
Thus, the cycle continues. The vendor desk continues to go unnoticed and underfunded. Individual staff members are left to handle a near insurmountable load of manual work themselves.
Like clockwork, holes in the manual vendor management process continue to appear. Then, the entire organization experiences continued lack of efficiency. Additionally, the risk of B2B payments fraud and other compliance issues increases.
And the cycle goes on.
If your vendor master file is built on a crappy foundation, then a lot of garbage is going to make its way in.
When garbage makes its way in, garbage then feeds your P2P systems, your business processes and your functions. Yes, your entire organization is affected by garbage input.
Ensuring the vendor master data is pristine is a big job. Furthermore, it’s complicated by multiple pressure points around compliance and preservation of working capital.
Look again at the illustration. Can you relate to any aspects pictured?
You may have a broken foundation that lets in all sorts of information that may or may not be accurate.
This bad data impacts all aspects of your department, and has serious organization-wide implications.
There are many other ways that a faulty vendor management foundation impacts your organization. These are just a few.
And here’s the thing. No single person is responsible for the foundation of your vendor management strategy.
Rather, strengthening your foundation is a team-wide, department-wide, and organization-wide effort.
To sum up, many people, processes, and products/technologies are required for secure, compliant, and profitable vendor management strategy.
Review the list of the ways that unreliable data affects your organization. Think about who you have tasked with making sure your data is true and accurate.
Ask yourself and your team the following questions:
While these questions are rhetorical, I think I already know the answers,. They aren’t positive.
The majority of finance and procurement teams also know the answer too. They know the person charged with gatekeeping the financial system is usually left to sort through vendor onboarding processes and procedures alone.
Oftentimes, this person has little clarity about what is at stake, and even less support to ensure they get each piece of the data exactly right. Not to mention they have a ton of work on their plate. They most likely even take work home with them and on vacation. It’s no joke.
Finance and procurement teams know these people are under enormous pressure to move as fast as possible, while also being as accurate as possible.
As a result, a Sisyphean task faces your staff. The boulder grows bigger and the hill steeper with each passing day.
We’ll end our 2023 vendor master predictions series with a challenge to you:
More than likely, it’s time to re-think your investment in the management of your payables strategy.
Your entire organization depends on getting it right.
Not sure where to start when it comes to creating a better foundation for your vendor management? Here are a few things you can do right now.
We have a ton of additional resources for you. Share these with your procurement and accounts payable staff, leadership team, and departments throughout your organization.
Remember, the goal is to cultivate a culture where the role of the vendor desk is truly appreciated.
The only way to do that is to make your entire organization aware of everything that the vendor desk does, and why it’s crucial to everyone’s safety, cash flow, and efficiency.