Vendor Master Cleansing is a topic that is gaining in popularity. Recently Shanna Flynn of Lavante wrote a blog comparing Vendor Master Cleansing to cleaning your room at home.
The bigger your company gets, the greater are the chances that your vendor master file will become filled with missing, outdated, inconsistent information, duplicate files, and other problematic vendor related information under the same corporate umbrella.
Vendor Master Cleansing can help your organization in many ways including
- Avoid higher costs associated with duplicate payments
- Decrease operational risks and silo’s data
- Reducing Missed discount cash opportunities
- Reducing Missed volume rebates
- Avoid fraudulent and non-transparent payments
- Increase Regulatory compliances
Knowing the advantages one might ask… When should I engage with Cleansing my Vendor File?
Well, the truth is, there’s never a Bad Time to do a Good Master Vendor File Cleansing!
There are some important business moments that can trigger a clean-up activity of your master vendor files, even if you haven’t conducted this kind of activity before:
- The new accounting package installation
- The hiring of a new CFO/controller
On the other side, it is a very common practice for some companies in situations where the master vendor files have never been cleansed, and an installation of the new accounting system is already on the way to simply start all over from the scratch, rather than at least try and cleanse the existing files. What’s the reason and justification for these “drastic measures”? Well, sometimes it may seem that it is easier to have a fresh start than to try sorting out the overwhelming mess of countless corrupted and inaccurate vendor files. However, this scorched-ground-tactics can be quite an expensive and a time-consuming adventure. That’s why there should always be a second chance for the first-time master vendor file clean up. Right?
Shanna Flynn’s Article on Vendor Master Cleansing
Understanding how fundamental clean supplier data is important for your business. Without clean data, all of your business processes could be in trouble. Don’t turn a blind eye to supplier data! Make sure your data stays clean.
Maintaining accurate data requires businesses to go through the supplier data periodically and scrub it. Cleansing the supplier data involves updating information, standardizing it, and reduplicating records. Clean data will decrease supplier risk and will increase supplier compliance. Having accurate data is crucial for having an effective supplier information management process. There is a need for an effective supplier management process when working with numerous suppliers, doing business with multiple suppliers requires a lot of documents and valid information to be traded.
Supplier data accuracy is important because, with rapidly changing regulations and an expanding supplier base, it is difficult for your businesses to have a relationship with your suppliers and know if their data is accurate and up-to-date. Not having clean supplier data is the root of all problems within a business. New rules and regulations are constantly taking place, making it hard for businesses to stay compliant at all times. Working with suppliers that aren’t regulated or validated could get both them and your business in trouble. Not having accurate general company information will increase the costs of managing these supplier profiles, incorrect payment information can increase risk, and poor supplier compliance is also increased. Dirty data affects all aspects of your business; what may seem to be a minor issue can disturb your business by creating unnecessary risks and wasted money.
All across the board, businesses have problems with inaccurate supplier data. All around the world parents have problems with their children’s dirty rooms. If you have children, I’m sure you’ve asked them at one time or another to clean their room. I bet that most of the time they don’t end up cleaning their rooms to your liking so you close their door to avoid looking at the mess. With supplier data, you don’t have the ability to just close the door to avoid seeing the dirty data. Turning a blind eye to dirty supplier data is bad news, you don’t see what is going on with the data which could land your business and your suppliers in hot water. Maintaining accurate data and a good relationship with your suppliers is important, especially if you are continuously doing business with them. The data that needs maintaining includes general company information, credit risk, and supplier compliance.
Lavante is the leader in vendor portal software, supplier onboarding, supplier information management, supplier data, vendor master data management, profit recovery.
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