As businesses take the first steps of recovery from the COVID-19 pandemic, we already see massive shifts in the way companies are looking at their supply chain. One segment, in particular, is the vendor management process. With the vendor management software market poised to grow by $3.96 billion by 2024, companies need to assess their processes before they feel even more profound impacts of delayed adoption.
The vendor management process goes beyond sourcing new partners or managing current orders, but also includes ensuring that certifications are up-to-date and accurate, completing risk analysis, negotiating terms and contracts, and optimizing internal resources. Many industries remain digitally-hesitant to adopt technology into their vendor management processes, which is a costly mistake. Manual operations through email, phone calls, and Excel sheets can cost businesses up to $10 billion in assets. In a market that demands efficiency for survival, reluctance to technology is no longer an option.
So, what can businesses do to streamline processes for a more cost-effective and optimized approach? The first step is to audit their current vendor management operations. What procedures work well, and where can methods improve? How do team leaders assign and manage accountability across their employees? How do they manage compliance and accountability across their vendors? Where is the most time spent that slows down the rest of the supply chain? When businesses take a deep dive into their operations, they can identify the types of solutions that are necessary.
While some of the solutions can emerge from internal streamlining, businesses need to identify software that can strengthen their processes. Historically, technology developed for the supply chain was complex and siloed based on the intricacy of the operations. However, we are currently living through some of the most challenging times in modern history, which breeds innovation. Software solutions will now be lightweight and intuitive to fit the needs of all supply chain participants to stay up-to-date in the new normal.
Based on the results of the supply chain audit, businesses can vet software solutions that will strengthen their operations. Team leaders need to think of all the participants from internal executives and managers down to factory managers and what tools will give each of those members access to the data they need.