Streamlining the Vendor Management Process 

Third party risk management can be a very frustrating part of the business. Vendors are absolutely crucial to business operations, but they operate independently, which makes them an uncontrollable factor for management. Businesses that do not have a proactive vendor management process find themselves in trouble when one of their vendors makes a mistake. If the vendor fails to deliver services, it can stop the business from delivering its services to its customers as well. That is why it is important to streamline vendor management.

Manage the Full Life Cycle of All Your Vendors

Businesses need vendor life cycle management if they want to ensure smooth operations. Vendor management systems that offer life cycle management functionality ensure that all the necessary steps are followed, from onboarding to offloading. It is important to ensure that all documentation is complete before a vendor is onboarded. It is also important to ensure that the vendor is provided with all the required information to deliver you services the way you need them delivered. That’s not all – life cycle management means that every aspect of the vendor relationship is managed. This means that vendor progress needs to be tracked every month and a report needs to be created.

Risk Scoring

Risk scoring is always an important part of streamlining the vendor management process. Businesses need to know the reliability of their vendors and the sensitivity of the business in relation to the services delivered by the vendor. If the vendor is supplying something that does not affect the business majorly then the risk will be low. However, there are vendors that supply products, materials, and services that are essential to run a business. A factory cannot run if it does not get the chemicals and materials it needs during production. An office cannot run if it does not have an active internet connection. These are examples of areas where vendor risk is high and needs to be managed proactively.

We recently publish How you can decrease risks through vendor management.
Risk scoring allows businesses to close their vulnerabilities, which is why it is such a crucial component of the vendor management process. Risk scoring tells businesses where they need backups. Any vendor that operates in a high risk area needs to have a backup or even multiple backups if needed. Businesses can also do risk scoring on the vendors themselves to determine which vendors are reliable and worthy of maintaining a business relationship with.

Communicate Assessments or Workflows to the Vendors

Another advantage of the streamlined vendor management process is that it gives your business the ability to provide feedback and insights to the vendors. If a vendor is consistently making a mistake or delivering services in a way that is inconvenient for your business, they need to be informed. They need to be given complete information about where things are going wrong and why your business needs them to deliver services in a different manner. If you continuously provide your vendors with feedback, they will keep tweaking their service delivery methods until a perfect equilibrium is achieved.

Check our recent post Three Benefits of Vendor Management Systems.

Streamlining Needs a Central System

The best way to streamline the vendor management process is to manage it through a centralized system. Vendor management systems are quickly becoming a common sight because of the benefits that they provide. They provide management with an easy and organized way of ensuring that their vendors are qualified and deliver the services that are needed. These systems offer full vendor life cycle management along. They also help in managing risks and compliance. Businesses can ensure that their vendors fulfill all the legal prerequisites for delivering services, including certifications and assessments.

Interested in seeing how a vendor management system can help your business? Get in touch with our team and see what the Predict360 Vendor Management system can do for your organization. The Predict360 vendor management system has been designed to help business foster better vendor relationships and ensure vendor compliance. It helps businesses manage third party risk as well. Get in touch with our team for a demo of the capabilities of the solution.

About the Company

360factors, Inc. (Austin, TX) helps companies improve business performance by reducing risk and ensuring compliance. Predict360, its flagship software product, vertically integrates regulations and requirements, policies and procedures management, risks and controls, audit management and inspections, and on-line training and qualifications, in a single cloud-based platform based on artificial intelligence.

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