The Risks of Bad Vendor Data Management

Maybe UT System’s story rings a little too close to home. It’s not uncommon for organizations to lack the internal resources for optimizing vendor data management. Before you know it, it’s at the bottom of the priority list, and things start to slip. 

While it might not seem like a big deal, especially when other “more important” things are front and center, not addressing vendor data management issues can have dire consequences. 

Duplicate entries, discrepancies, and bad data: Without automation, vendors may be accidentally added to the system more than once. And if you’re relying on manual labor to onboard and check vendor data, you’re bound to run into inconsistencies. A name gets mistyped here. A wrong vendor name gets links to the wrong bank account there. It’s all very concerning and can lead to headaches for you and your vendors – and more time wasted.

Incomplete data: The next offender is incomplete data. You may think you have everything you need for an onboarded vendor, but over time, you come across missing fields. One vendor doesn’t have a tax ID. Another vendor is missing a contact email address. You’ll likely have to reach out to those vendors by phone or email, which opens the door to fraud and, you guessed it, wastes time. 

Outdated information: Is data being updated regularly? While too many unnecessary changes can be a risk, not updating vendor information enough is not good either. If most of your vendor data hasn’t been updated in months or years, you probably have bad vendor data. Don’t forget sanctions lists are updated regularly, and vendors must continuously be checked against these lists. Not doing so can lead to expensive non-compliance. 

Dirty vendor data is a direct result of bad vendor data management. And it’s common in organizations that don’t have automated processes.

Vendor Data Management Automation in Practice

Don’t worry; UT System’s story has a happy ending. They were able to get PaymentWorks up and running quickly. This allowed UT System to get vendors onboarded without a ton of assistance from IT. This enabled a fast implementation and go-live. 

Then, once they figured out how to move vendors into PaymentWorks, they automated the feed to the ERP. By getting the data mapping right before integrating with their ERP, UT System saved a ton of time. Additionally, it made the switch to a new ERP even easier because they could clean the entire vendor file by having all existing vendors onboard with PaymentWorks. 

Hear UT System’s AP Director, Tisha Marshall, talk about that process here: 

So UT System can be sure the new ERP has accurate, up-to-date vendor information for 100% of their vendor file. 

Automating vendor data management has allowed UT System to:

• Have assurance that payments are going to the right people and the right place- efficiently.
• Significantly mitigate the risk of falling victim to payments fraud.
• Increase vendor visibility and better communication between campuses, resulting in the ability to collaborate to get the best pricing.
• Be more strategic; staff can do more with their roles and add value to the University by doing auditing, reporting, and analytics – things they didn’t have time to do before.
• Continuously enroll new vendors with Virtual Card, adding additional rebate revenue to the department! Hear Tisha talk about that ROI bonus here:

The benefits of vendor data management automation are significant. In the case of UT,  The work they could do with their manual processes now automated proved so significant that the system invested in an additional headcount for the team! Yes, you can cut down on time wasted on manual tasks that are prone to mistakes. But you can also be more value-focused and boost ROI with the right strategy in place.