7 Ways Automating Your Vendor Management Can Deliver ROI
Without a structured vendor management solution, your company is probably losing money every year from overspending on contracts with third parties.
A solution to this is optimizing your vendor spend and reducing the amount of staff time spent on management. More and more companies are doing this by automating their vendor management, with options including web apps and cloud-based solutions that can handle most, or all, of these tasks with tools that offer a unique set of features.
Unique features of automated vendor management
Here are seven unique features of automated vendor management that deliver a return on your investment in a vendor management solution:
1. Expense savings are gained from real-time visibility into vendor management and include deployment, awareness of upcoming price increases and dates, standardization and centralization of prices, automated vendor performance reviews, and avoidance of above-market pay rates and supplier markups.
2. Gain personal time and labor savings by reducing the hours individuals spend at vendor management, including due diligence.
3. Reduce human error through transparency and the automation of tracking and calculating dates and renewals, assigning of required documents, and scoring of risk and performance metrics.
4. Collaboration savings are facilitated by more visibility, with direct input across channels and siloes encouraging teamwork, enabled by vendor management templates that store vendor information and manage multiple relationships simultaneously.
5. Compliance and audit savings occur due to reduced time spent preparing for audits and examinations and to responding to auditor and examiner requests, with an increased likelihood of compliance.
6. Financial disclosure and legal review savings arise from reduced time to request, retrieve, review, and document findings for vendor financial statements and statements of financial condition as well as time and cost for legal review, leading to a standardization of administrative processes like filing resumes, tax forms, certifications, IDs, and more.
7. Documentation printing and storage savings happen thanks to reduced printing and storage in folders and paper files, as digitization provides universal access to vendor documents.
Automating vendor management can guarantee an impressive return on investment across multiple categories. It’s also ROI that happens very quickly, especially when it comes to process-related efficiencies. By automating your VRM processes, policies and workflows, you can save time, reduce resources, and spend less for third-party services.