Every hour the following happens worldwide:
-40 CEOs are fired
-80 businesses are closed
-240 business addresses are changed1
Not only do the changes like those listed above have negative effects that ripple across business functions, these shifts mar data stored by companies across the globe. Global companies typically have several financial systems in various locations where data is stored. That data is stored in multiple local formats and is often maintained manually by local teams. So, changes in business often translate into messy data, which poses difficulty for properly managing supplier information. And that’s where we’ll start in Part 1 of this series on how to improve supplier information management: understanding the problem.
When is supplier information management difficult?
Without a fully integrated purchase-to-pay solution that creates a single source of truth for companies, proper supplier information management is challenging. It’s difficult to keep supplier information clean with changes needing to be made not just in one system, but in multiple disparate systems, by multiple people, in multiple locations and in various languages.
Because of poor supplier information management – up to 96% of supplier contact data within a given company’s customer files and customer relationship management systems is at least only partially inaccurate. 1
Why should you improve supplier information management?
Poor quality, erroneous supplier data has obvious and unfortunate consequences such as:
Low/stagnant invoice automation rates due to the requirement for several manual verifications when processing invoices
Increased risk of late or inaccurate payments since invoices that require more human intervention due to incomplete, incorrect supplier data often get delayed in processing
Inefficiency in AP due to time spent in discussions with suppliers to verify information and correct errors.
Additionally, frustration grows, and relationships suffer. Increasing invoice-related dialogue can damage supplier relationships. Accounts Payable professionals feel frustrated with repetitive manual checking of missing or flawed data. The results are strained buyer-supplier relationships, poor performance in AP and late or even duplicate payments.
Where should you start when looking at how to improve supplier information management?
The first step is acknowledging the current reality. Companies must make the decision to no longer accept the lack of visibility and data fragmentation and enact a systematic approach to properly manage supplier information. Companies must recognise the opportunity proper supplier information management presents not only for cost savings but for better, more strategic supplier relationships.
This starts by looking at how to fully integrate procurement and AP processes with automation. Basware commissioned Forrester Consulting to conduct a Total Economic Impact™ (TEI) study and examine the potential return on investment (ROI) enterprises may realise by deploying Basware’s end-to-end purchase-to-pay cloud solution. The study found that organisations facing challenges from disjointed procurement and finance teams and disparate systems can realise 307% return on investment.
The next step is to look at how that purchase-to-pay solution supports proper supplier management to turn problems into opportunities.
How can Basware help?
At Basware, we believe in helping customers realise success with fully integrated purchase-to-pay solutions, a network that is easy for suppliers to join and augmenting financial processes with solutions that make tasks like supplier information management seamless. Ready to learn more? Reach out – we’re here to help.
1 Dun & Bradstreet: The Big Payback on Quality Data