• 6 min read

Simplifying Source-to-Pay Workflows with Vendor Data Master in a Connected Ecosystem

Vendor Data Master (VDM) is a centralized repository of information about a company's vendors, suppliers, and partners. The vendor data master provides a comprehensive and up-to-date view of the company's vendor landscape, enabling better decision-making and more effective management of the supply chain. By preserving key vendor data elements in a centralized repository, companies can more easily manage vendor relationships, monitor vendor performance, and mitigate supply chain risks.   

What information is preserved in VDM?  

The exact information that is preserved in the VDM can vary depending on the specific needs of the organization; however, these are some common data elements that may be included:  

  1. Vendor identification information: This includes basic information about the vendor, such as their legal name, address, and contact information.  
  2. Vendor financial information: This includes data related to the vendor's financial status, such as payment terms, credit limits, and payment history.  
  3. Vendor compliance information: This includes data related to the vendor's compliance with regulatory requirements, such as certifications, licenses, and permits.  
  4. Vendor relationship information: This includes data related to the company's relationship with the vendor, such as the history of transactions, contracts, and communication.  

How does Vendor Data Master help enterprises with a connected Source-to-Pay experience?  

Vendor Data Master (VDM) can be a valuable tool for contract, invoice, and supplier relationship management, providing a centralized repository of information about a company's vendors, suppliers, and partners.   

Did you know with a connected source-to-pay solution, you can derive insights from VDM regarding vendors' performance, which can be used as a negotiating point in future contract negotiations? It can also be used to monitor vendor performance over time, enabling companies to identify trends and make informed decisions about vendor relationships.  

[A] Ways in which VDM can help in contract management:  

Determining Vendor Eligibility  

VDM can help identify and classify vendors based on their characteristics, such as size, industry, and location. This can be useful when determining which vendors are eligible for specific contracts.   

Monitoring Contract Compliance   

VDM can be used to monitor vendor compliance with contractual obligations, such as delivery schedules and quality standards. By tracking vendor compliance, companies can identify potential issues and take corrective action before they become more significant problems.  

Terminating (or Renewing) Contracts  

VDM can help companies manage the contract renewal and termination process by providing a centralized location for tracking contract expiration dates, renewal options, and termination clauses.  

Overall, Vendor Data Master can be a crucial tool for contract management, enabling companies to manage their vendor relationships more effectively. In addition, by providing a centralized repository of vendor data, VDM can help companies make more informed decisions about vendor selection, contract negotiation, and contract management.  

[B] Ways in which VDM can help in AP (Accounts Payable) Automation (Invoice Management)  

Vendor Data Master (VDM) can be a valuable tool for Accounts Payable (AP) managers, who manage the payment process for vendors and suppliers. Here are some ways in which VDM can help AP managers:   

Preventing Fraudulent Payments  

With Vendor Data Master, AP managers can quickly identify and verify vendor information, such as legal name, address, and tax identification number. This can help reduce errors like duplicate payments and missed discounts and prevent fraudulent payments.  

Preventing Payment Disputes  

Maintaining a centralized vendor repository is a single source of truth for AP managers wherein they can store and manage payment terms and conditions for each vendor, ensuring that payments are made according to the agreed-upon terms. This can help prevent payment delays and disputes.  

2-way and 3-way Invoice Matching  

You can integrate vendor data master with invoice management software to automatically match invoices with purchase orders and receiving documents. This can reduce errors and streamline the payment process.  

Tracking Payment Performance  

VDM can store payment history for each vendor, enabling AP managers to track payment performance over time. This can help identify potential payment issues and improve vendor relationships.  

Overall, Vendor Data Master can help AP managers to more effectively manage the payment process for vendors and suppliers, ensuring that payments are made accurately and on time. In addition, by providing a centralized repository of vendor data, VDM can help reduce errors, improve vendor relationships, and streamline the payment process.  

How to effectively manage Vendor Data Master with Vendor Onboarding Solution?  

Vendor onboarding software can be a powerful tool for managing Vendor Data Master (VDM). One of the key functions of a vendor onboarding solution is to manage vendor data master, which refers to collecting information about the vendors an organization works with. This information includes details such as the vendor's name, contact information, tax identification number, banking information, insurance certificates, and other relevant documentation. 

Here are some ways in which vendor onboarding software can help:  

Streamlining the onboarding process:   

Vendor onboarding software can automate collecting vendor data, reducing errors and speeding up the process. This can help ensure the accurate and efficient addition of new vendor data to the VDM.  

Ensuring data accuracy and completeness:   

Vendor onboarding software can provide validation checks for data fields, ensuring that the required data is complete and accurate. This can help improve the overall data quality in the VDM.  

Enforcing data governance policies:   

Vendor onboarding software can enforce data governance policies, such as data retention and privacy policies. This can help ensure vendors provide data compliant with company policies and regulations.  

Facilitating communication with vendors:   

Vendor onboarding software can facilitate communication between vendors and the company, allowing for seamless collaboration and information sharing. This can help improve vendor relationships and ensure that the VDM is up to date with the latest information.  

Signing Off  

Overall, vendor onboarding software, like Aavenir Onboardingflow – Vendor Onboarding and Information Management Solution on ServiceNow, can be a valuable tool for managing vendor data master, helping to ensure that vendor data is accurate, complete, and up to date. By streamlining the onboarding process, enforcing data governance policies, and facilitating communication with vendors, Aavenir Onboardingflow enables more efficient and effective management of the VDM. BOOK A DEMO  

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