Over the years of doing webinars about Vendor File Management, I have been shocked by how much feedback these presentations have generated. One of the most intriguing topics from these webinars was how to build a case for a vendor file management program. Although it may require time on your part, the most effective way to create management support for you to contract resources to help clean your vendor file is to perform some quantifications about what your out of control vendor file is costing you. Some of the things we suggested during these webinars were to quantify the following:
- Value of time spent resolving payment errors
- Customer service costs associated with payments sent to wrong location
- Costs of reissuing checks
- Time spent setting up vendors multiple times in error
- Costs of NOT using automated payment technologies
- Time is wasted trying to find and verify accuracy of vendor information.
- Inability to take early-payment discounts, confirm contract terms are being adhered to, or to ensure that employees work with preferred vendors
- B-Notice Fines Most companies evaluate data quality projects because they qualitatively know these things are hurting them.
Demonstrating the cost of a poorly maintained vendor file will quickly get management attention and support. I would also offer one other idea that we left out of the webinar because we did not want to make the event a sales pitch. Our own solution (at Lavante) couples vendor file management and Profit Recovery so that you can drive a hard ROI in addition to many different softer ROI’s outlined above.
In any event, Vendor Files are a universal pain point for most large enterprises and if you are trying to get momentum behind a cleansing project, I strongly encourage tying the project back to dollar saving potential.