Supplier information management (SIM) refers to a business's system capturing, storing, updating, and analyzing all supplier data in a single location.
It helps organizations create a detailed understanding of their supplier’s capabilities and weaknesses.
Typically, SIM tools are packaged into an online portal, where suppliers can self-serve onboarding, account maintenance, and data management processes.
It also includes processes to complete full audits to ensure compliance and minimize supplier risk.
The software may also send automated alerts to ensure suppliers can stay on top of key metrics and documents with the need for administrative overhead from the buyers.
According to a May 2022 report by APQC, respondents still need to start using a supplier relationship management solution; 69% are extremely likely to implement it within the next two years.
Recent supply chain disruptions have highlighted the importance of cultivating strong supplier connections.
Consider some of the key benefits that drive the market toward the adoption of supplier information management software solutions.
See Supplier Information Management in action
Benefits of supplier information management
According to a survey conducted by Procurement Leaders, supplier performance and risk management are the top focus for chief procurement officers.
Supplier information management offers significant benefits for procurement teams as a standard business practice, and the most common are listed below.
Cut administrative costs
Instead of manually entering supplier information, SIM encourages suppliers to self-serve.
This ensures you have the latest information for your business without entering the data yourself, saving time and cash.
Automate certain tasks
SIM automates many rudimentary tasks. Alerts, notifications, and messages are sent to suppliers to ensure that essential documents are kept up to date.
In addition, rudimentary compliance tasks can be automated to ensure new certifications and accreditations are kept current.
The supplier relationship management system also intervenes when suppliers need to update their details by putting non-compliant suppliers on hold.
With just one system managing all your supplier data, you’ll avoid duplication, reduce errors, and ensure all your supplier data is the same across your entire business.
Having ready access to real-time data keeps a company in the know and ensures that all teams in the business are on the same page.
Capture key information
SIM encourages procurement teams to capture better-quality data on their suppliers, including risk metrics, KPIs, and specific supplier capabilities.
This information proves to be invaluable for procurement teams when it comes to evaluating suppliers.
Protect sensitive data
Handling third-party data comes with a measure of risk. One way to mitigate this inherent risk is to use a software solution to protect sensitive supplier data.
A cloud-based solution creates an accessible yet secure portal for partners to enter data. This limits the transmittal of such data through insecure means like paper, fax, or email.
Integration with ERP systems
Data analysis is improved with separate data repositories that can communicate, giving your business a greater overall view.
Supplier information management software should integrate seamlessly with popular ERP systems through prefabricated connections or rest APIs to provide a holistic view of supplier relationships.
Frequently asked questions about supplier information management
Supplier information management software is designed to provide a dedicated portal for vendor partners to input and maintain company information.
Cloud solutions provide anywhere, anytime access to reduce the risk of data loss.
SIM software can:
- Accelerate the onboarding process for new partner companies
- Minimize manual data entry by internal staff
- Simplify comparisons between vendors
- Streamline supplier communications
Suppliers are a key break point in your business processes, and supply chain disruptions are a continuing problem in many industries.
Reviewing supplier performance data against key indicators can help your business choose the right supplier for the right purchase.
Having vendor information, performance statistics, and relationship data in one solution can provide the following:
- Improved supplier reliability and reduced risk
- Improved customer service
- Streamlined and simplified business processes
- Reduced costs
- Monitored vendor compliance with data requests
Vendor management software puts the tasks of onboarding and ongoing updates to supplier information into a secure, self-service portal.
The supplier, rather than internal staff, is responsible for providing initial and regularly updated company data.
Alerts ensure that supply partners are notified of necessary entry tasks.
For every third-party company you do business with, things like current contact information and contract terms are necessary.
The system also captures key data based on vendor type. The master supplier database can gather information via questionnaires and regulatory requirements.
This ensures that you remain compliant and data stays fresh. Thus, your business is protected from working with non-compliant supply partners.
Other data that can be collected includes benchmarks for calculating key performance indicators that allow you to compare vendors to make strategic sourcing decisions.
When this vendor-specific data is paired with connections to external rating metrics like Dun & Bradstreet, a full view of vendor capabilities can be achieved.
Yes, supplier information management software can integrate with other systems, and that is one of the key positives of SIM software.
It keeps procurement and accounts payable departments communicating and prevents the trend toward data silos.
Supplier Management from Medius connects to supplementary solutions and popular third-party ERP systems. This gives staff the power to see the whole picture and use tools they are already trained on.