How do you manage your suppliers?
One of your primary tasks as a decision maker in your organization is to ensure that your suppliers are organized correctly. Understanding where each supplier fits into your supply chain can drastically improve your supplier risk and supply chain risk management and can protect your business from the effects of disruptions – both predictable and unforeseen. The question, then, is around the most effective and efficient way to manage your suppliers. With Supply Chain Partner as your partner, you can implement a supplier information management (SIM) system to give you full control. If you’re not entirely sure if a SIM system is the best option for you, have a look at our guide of everything you need to know.
What is supplier information management?
Supplier information management is the process in which a business captures, stores, organizes, and categorizes all supplier data in a single location. An important part of supplier information management is that it moves your supplier and procurement processes towards true digital transformation. As it digitizes your processes, the data relevant to your suppliers can be drastically improved and analyzed on a global scale.
What is a supplier management process?
A supplier management process is the system that traces a business’s relationships with its suppliers and verifies that suppliers have been paid while the business receives the full value of its purchases. This system can identify the strengths and weaknesses of the supply chain and the supplier management process and highlights areas to be improved. As errors in this process can lead to substantial losses of efficiency for your businesses, having a supplier management process is a critical part of supplier information management, and assisting your organization in eliminating risk and excess spending.
How does supplier information management work?
The SIM process can be broken down into several steps. First is the evaluation of suppliers, which ascertains whether they are a fit for your company, and whether their goods and processes fulfill your needs. Then, the supplier needs to be onboarded, which can be done digitally once processes have moved to the cloud, to keep relevant parties notified and to ensure that the supplier is made aware of your organization’s processes. Then, the supplier is categorized based on risk, type of goods, total spend, and the importance of the supply. Once the partnership is established, the relationship must be developed and maintained to improve the process and ensure supplier satisfaction. Finally, transactions and processes must be analyzed to identify potential areas of improvement and to verify that the terms of the contract are being met.
The overarching purpose of SIM is to develop the supplier relationship and increase the efficiency of your systems – from eliminating manual processes to providing greater oversight of your suppliers and their data. As an expert in supply chain management and procurement, Supply Chain Partner (SCP) can assist your organization to build out supplier information management systems that suit you perfectly. Whether by integrating with your existing systems or defining new processes, SCP can help your organization enact and adopt the appropriate SIM system that will support your supplier relationships and provide the value your organization needs.