VMO because –

ONE SIZE DOESN'T FIT ALL

Each company has their unique needs which may be different from that of other companies. This is the reason no two vendors are similar and therefore sometimes making an attempt to force a relationship with a vendor which contrasts one’s company culture, volume can be like trying to fit a square peg in round hole.

There is no denying to the fact that organizing one’s vendors can save a considerable amount of money, but not every vendor or deal gets same amount of attention from the vendor management office. The aim is to allot resources to the relationships that have major impact on enterprise strategy.

It’s necessary to first know what one is looking for in a vendor. Then weigh the vendors depending on the most crucial things, things which fall into tie breaker category. Having a clear vision how the vendor would be selected saves a lot of guesswork and some serious headaches.

Fix a target and then make a list. This would give a clear picture of how much a vendor needs to deliver in a period. Keep a track of all the past relationships, which vendor performed extremely well and which vendor disappointed.

Having a good vendor management system in place is not a simple process. It is a continuous process of maintaining communication with vendors, so by knowing and communicating one’s expectations to supplier one can lessen the possibility of misunderstanding and problem in supply. By having a good vendor management, a company will be in a position to be successful.

IT SOURCING IS NOT "BUYING TOILET PAPER"

Vendor management is a complex task. It has a wide range of influence on the business. Maintaining good relationships with the existing vendors’ means on-time and efficient delivery.  On the other hand, poor vendor management system can lead to bottle-necking and other inefficiencies. Vendor management comes down to a lot more than simply trying to haggle for the lowest price. Enterprises that have a formal vendor management group clearly gain both monetary and strategic advantages.

Communicating with vendors is just as important as communicating with customers. Having proper communication with vendors builds a win-win relationship with vendors as it leads to increased efficiency, reduced costs, better customer service and more over it builds trust amongst two parties.

Gone are the days when organizations focused on price, without understanding the underlying technology issues that affects IT’s ability to serve business needs. Today, large organizations need vendor management because of their scale.

About Author:

Nisha Tolani is consultant and part of Systems Plus Pvt. Ltd. She is a part of consulting team that delivers Sourcing and Vendor Management Office projects. She can be contacted at: nisha.t@spluspl.com