This post is based on material contained in the following Spend Matters Compass Series research: Beyond One-Off Initiatives and a Virtual Vendor Master – Advanced Use Cases for Supplier Management. Please click here for Part 1 of this series. Another key element where advanced supplier management processes can support cross-procurement efforts includes contract management and services procurement (SOW) linkages.
These types of integrations enable the dissemination of change orders, milestones, deliverables, and specifications. The ability to engage vendors directly via supplier management tools or integration with contract management systems (and in the case of services procurement, these are tightly connected to VMS/MSP solutions) where ongoing performance is reported on and tracked is another key enabler. The goal should not be to edit contracts via a SIM toolset but to deliver a full picture of contractual activities within the SIM experience. Since many users do not have access to CLM solutions, the relevant CLM content should be visible to those that engage around a given vendor.
Further, such advanced supplier management use cases can enable supplier performance management and vendor development initiatives by leveraging SIM not just as a repository but a broader collection, collaboration and enablement tool to manage supplier site visits, audits, cost reduction workshops, action plans and ERP-related performance metrics. In addition, advanced supplier management approaches can help bridge both internally collected/managed and third-party sources to monitor the financial health and risk of vendors and critical customers. These efforts entail the management data points ranging from audited financials or self-reported numbers and ratios to D&B and other third-party metrics.
Perhaps the most powerful supplier management use cases come from what we refer to as dynamic marketplace solutions that connect procurement, finance, legal and operational interests through aligned supplier information management efforts. Indeed, the cutting edge of supplier management approaches is the integration of information and processes across functions. There has been a clear trend, accelerated by consolidation of data across functional bounds through direct system integration and structured master data management approaches. A sophisticated SIM solution is essential to enable this level of functionality.
Stay tuned as we investigate these dynamic use cases further. Or download the full paper today in the Spend Matters PRO Research Library: Beyond One-Off Initiatives and a Virtual Vendor Master – Advanced Use Cases for Supplier Management.