Are your supplier diversity personnel spending their time working with suppliers in order to build capacity and find new opportunities, or are they mired in time-consuming tasks like verifying supplier status and cross-checking data? If the latter sounds familiar, it's time to invest in comprehensive supplier management software in order to make your job easier.
When looking for a supplier management software solution, you want something that does more than track spend—you want a solution that streamlines processes, insures compliance, and offers custom reporting, all backed by accurate data. Here are six things to look for:
1. Access to Constantly Updated Supplier Data
Your supplier diversity program is only as good as the data it uses. With supplier data constantly in flux, you can’t afford inaccurate and outdated information on your supply base. Procurement decisions are business decisions, and having insight into your data empowers your organization to be confident it is making the right choices with suppliers.
CVM Solutions offers a Master Database populated with millions of small and diverse supplier records from 350-plus verified sources. The Master Database is updated frequently so that you can confidently build and grow your supplier diversity program.
A Data Enrichment service references and cleanses your supplier data against the Master Database, providing supplier information standardization as well as completion of missing data. Duplicate suppliers and misclassified locations can lead to wasted time and resources for your organization, driving up unnecessary costs.
2. Identify and Vet Potential Suppliers
A supplier management solution should make it easier for you to find and assess new or alternate certified diverse suppliers. Supplier Locator software connected to a Master Database provides accurate, up-to-date company and supplier contact information that allows you to search and filter by diversity category, certification source, commodity and area of expertise, geographical location, and more.
Once you've identified potential suppliers, automate the onboarding process with a custom supplier portal. You set up the criteria that suppliers must meet in order to be considered for bidding opportunities, the supplier completes the process, and then your supplier diversity team contacts the supplier in order to further the relationship. By automating the vetting process, you've saved hours of time that can be put into more valuable tasks.
3. Perform Risk Assessment and Management
Supplier data are constantly changing. Mergers and acquisitions, ownership changes, and other factors can affect a supplier's diversity status. Data enrichment services help you track certification or classification status in order to mitigate risk and maintain the integrity of your diverse spend when preparing both internal and external reports.
Supplier diversity compliance requirements can be confusing or intimidating, especially for a company that is new to federal contracting, which requires that vendors at a certain threshold meet diversity spend goals. Fortunately, the secret to compliance is really the secret to any successful supplier diversity program: Establish realistic goals and maintain accurate tracking of your diverse suppliers and your diverse spend. Supplier management software helps you document the process every step of the way, ensuring that you are in compliance with federal mandates.
4. Measure Supplier Performance/Reports and Metrics
The benefits of accurate reporting cannot be overstated. Detailed reporting shows us how our efforts are paying off, helps identify areas for improvement or potential risk, establishes benchmarks, and aids in setting goals.
Detailed reports identify your top suppliers by spend so that you can recognize and reduce supplier dependence before it causes an interruption in your supply chain. Alternatively, a report may reveal an opportunity to increase spend with suppliers with deteriorating revenue in order to ensure their economic success and the quality of your supply chain.
Look for a supplier management solution that uses data from verified sources and gives you the ability to customize reporting down to a granular level.
5. Ease of Communication/Relationship-Building
Building relationships with your suppliers is the surest way to grow your supplier diversity program; it's also time-consuming. Make the most out of your time—and your supplier's time—by streamlining and automating the process wherever possible. Use supplier management software in order to send out reporting reminders and notifications, check on supplier status, and alert yourself to potential risks in advance so that you can communicate with your suppliers.
Effective internal communication is also important as you integrate supplier diversity into your organization's culture. Everyone likes to hear that their efforts are paying off, but often we forget the importance—and positive impact—of communicating success. Look for supplier management software that allows you to set up customized messages specific to internal and external audiences that clearly define the program scope, details, and goals.
6. Growing and Improving
Just as diverse supplier status is constantly changing, so are your business and its needs. As your business grows, your supplier management software should grow with you. Look for a solution that is fully supported and being developed in order to stay current on—or even ahead of—best practices. A stagnant supplier management software solution is a dead software solution.