Those of you following Spend Matters in recent months will remember a post on VendorMate , a vendor registration, credentialing, and compliance monitoring solution provider with a large footprint in the healthcare sector.
Not long ago, I too spent some time talking with Andy Monin in an effort to understand the extent of their offering and how they differ from services provided by providers such as Austin Tetra, Open Ratings, Browz, and Connect4Growth. It was an illuminating discussion and I believe that they are truly fulfilling a need in the healthcare sector in particular and that the financial sector needs to take a long hard look at their offering.
Jason Busch highlighted some of the benefits of the Vendormate solution, including the capture of supplier information through an online registration portal, the capability to capture supplier credentials and certificates, the built in rating and scoring system that uses 126 data points, user defined thresholds and risk tolerance, and 3rd party data to assign each vendor a risk score, and the ability to manage compliance risk through exception and be alerted when a supplier may have fallen out of compliance.
What Jason did not highlight were the following facts:
- most mid-size and larger organizations have no clue how many vendors they are doing business with, even within a single commodity category (a point that the spend visibility vendors spend a lot of time trying to drive home)
- many companies go through peaks and troughs with respect to vendor cold-calls; after a major advertisement or in a public standing offer renewal period, a company will be bombarded with more calls than it can handle, while the rest of the year calls will be few and far between; furthermore, it can be difficult to differentiate between vendors that can provide positive productivity and savings opportunities and those that will do nothing more than waste your time and money – a systematic approach, such as that provided by Vendormate, for receiving, screening, and processing these vendors helps you differentiate the gold from the coal and insures that your business operations are never disrupted as a result of vendor cold calls
- regulatory compliance, terrorist screening, and fraud are huge problems that need to be addressed not only in your company, but in your supply base
- many companies have no means, or no time, to insure that vendors are aware of, sign off on, and agree to policies and procedures
- since Vendormate implements a paid subscription service, vendors have an incentive to keep the information current
Vendormate’s solution addresses these problems as follows:
- by providing a common registration system, and refusing to deal with any supplier not in the system and approved, you can know precisely how many vendors you are dealing with and precisely how many provide you with a certain category of goods; this can greatly improve the accuracy of your spend visibility and analysis efforts
- by providing a self-serve supplier portal, especially one that comes bundled with a registration fee (to offset processing costs and credential review), a buyer can streamline vendor registration, review, approval, and selection
- by integrating with third parties that provide terrorist watch lists and companies that have been identified as committing fraudulent activities in the past, companies can insure they remain in compliance with their vendors and mitigate some key risks
- by providing you with a centralized process, it can insure that a supplier accesses a policy, and signs off on acceptance before completing registration; this is key to mitigating risk and future litigation
All-in-all, it’s a great way to kick-start your vendor management and compliance initiatives, especially in the verticals they have considerable strength and experience in. In addition, I highly recommend you check out Vendormate‘s blog, it is shaping up to be a good resource on vendor management.