Does Having A VMS Improve Vendor Performance?

With the ever-surging competition in the global marketplace, companies are indisputably dependent on the external workforce for goods & services. Businesses continue to scout for talent and resources from around the world. While beneficial, it is challenging to keep track of all of them.  

 Having a global talent base facilitates flexibility and easiness in procuring specialized skills. Though, it does toss up some managerial and administrative obstacles along the way. There are financial, legal, and security consequences to worry about while dealing with a remote workforce.  

When your vendors are spread across the globe, a competent vendor management system can help you manage the orders, finances, and contracts a little better. Dock VMS takes a systematic approach to handle all the particularities of vendor management. Whether it's vendor hiring or onboarding, you can steer the entire operation with complete visibility and efficiency. And irrespective of the location, department, or scale, organizations can introduce a consistent system for the vendors with vendor management software. Now, let’s discuss in detail how exactly Dock VMS enhances vendor performance.  

How does VMS help to improve vendor performance? 

As labor and service providers, vendors play a crucial role in the overall efficiency and reputation of an organization. That is why it is vital to maintain the performance of all the external workforces associated with a business. Aside from tools to effectively manage vendors on a single platform, VMS also offers services to improve vendor performance.  

 1. Vendor scorecards

Dock VMS is not just limited to storing and organizing vendor-related data. The platform offers comprehensive features and tools essential for an optimized vendor relationship. One such feature is the vendor scorecard, where you can analyze and rate all the vendors. In the scorecard, you can assess and review the vendors in areas that suit your business. 

From cost to quality, you can use different performance indicators to customize your scorecards based on each vendor. If there is a constant evaluation based on key performance indicators, there is always a scope for improvement. Consequently, the vendors will be able to realize the shortcomings in their operation and work towards rectifying them. 

 2. Track activity in real-time

The Dock vendor management system offers activity tracking to keep up with all the vendors. Businesses can easily oversee the duties and commitments of vendors in real time. So, if there is any performance gap, companies and vendors can identify it in the initial stage. This ongoing monitoring can ensure the quality and promptness of the deliverables. Also, it ensures that the company gains increased value performance from its vendors over time. 

 3. Track certifications

For maximum productivity from the external workforce, businesses need to optimize the hiring and procurement process. With Dock VMS, companies can utilize supplier assessment and applicant tracking to guarantee only the best services. Consequently, the company will only have to deal with talents that have the required qualifications and certifications.  

The vendor management software also acts as an all-in-one platform to collect and store all the necessary vendor-related documents such as certificates, insurance, contracts, etc. This intelligent hiring and document management helps to bring efficiency and consistency to vendor performance. Also, since the workforce is geographically divided and follows different labor laws, a vendor management system can help to enforce compliance on all levels.  

 4. Vendor questionnaires

Businesses require extensive information about vendors and their activities to establish a productive relationship. Dock VMS features a customizable questionnaire that helps to gather all the essential vendor data in one go. It is a strategic and straightforward way to communicate with prospective vendors. The vendor management team has complete control over the questionnaire. So, they can strategize and prioritize questions pertinent to their business. Thus, the HR and procurement teams are better equipped to identify the right kind of labor and services.  

Questionnaires help to edge out the less viable options and arrive at a vendor that meets their needs. Thus, with Dock VMS, businesses can make an informed decision when choosing an external workforce. And from the get-go, the company and the vendor are aware of each other’s needs. As a result, there is a productive, collaborative, and long-term vendor relationship. It streamlines the vendor relationship and enhances their performance down the road.  

 5. Accountability

Extensive data-driven reports are the backbone of a competent vendor management system. From comprehensive vendor records to scorecards, all help businesses accurately evaluate vendor relationships. This continuous collaboration between all the stakeholders to share data can lead to improved accountability among the vendors. As a result, vendors will be more inclined to take steps to improve their goods and services. Both incentives and penalties for their service are evident through the management platform, so vendors can gauge their success and alter accordingly.  

 6. Risk management

Dock VMS empowers organizations to mitigate the risk associated with employing an external workforce. From financial to legal, vendors pose many threats to the reputation and functioning of a company. The automated management system offers several features such as scorecards and notifications to control the risks involved.  

An optimized VMS and reduced risks mean maximum productivity and quality work for the organization. With comprehensive risk management, the vendor relationship also improves considerably. These evident improvements reflect positively on the overall performance of the organization.  

Why is vendor performance important? 

As we discussed, vendor performance and credibility are vital to a company’s reputation and growth. Moreover, optimizing the vendor management process through VMS means reduced risks, time, and operation costs. 

With enhanced vendor performance, businesses are guaranteed consistent high-quality and value products from their vendors. And in the long run, this consistent performance can convert into an improved brand image and customer satisfaction. That is why it is vital to take every necessary step to maintain and enhance vendor performance. 

How to improve vendor performance with VMS? 

Now that we have established the importance of vendor performance for the existence of a company, let us see how you can maintain it with Dock VMS. Vendor management does not end with acquiring a competent workforce. 

If there is too little focus on vendor performance, there is no room for growth or improvement. The following techniques and methods will help an organization to ensure that efficient vendor performance is consistent, not a glitch. 

 1. Achievable Goals 

Once you have decided on a vendor, it is crucial to clearly define your expectations and requirements. If you set the benchmarks early on, it would make it easier for the vendors to meet your needs. Moreover, having clearly cut organizational standards helps to evaluate vendor performance and compliance. With Dock VMS, you have access to questionnaires and vendor portals to lay down your organization’s needs and demands.   

 2. Data Collaboration 

For a long-term vendor relationship, it is crucial to constructively collaborate at each stage of the work cycle. Continuous communication and strategizing can make it easier to achieve high-yielding results for both vendors and organizations. Vendor notifications and self-service portals available on Dock VMS can help businesses to stay on top of their vendor relationships. 

 3. Realistic Deadlines

Apart from strategic goals, achievable deadlines must be set for the vendors every step of the way to ensure definite results. They help organizations gauge progress and milestones at each stage. Keeping the deadline is a relevant performance indicator for a vendor. Also, fixed deadlines for goods or services prevent unnecessary risks and delays. 

  4. Monitor Vendor Performance

 Every business is different, so organizations need their own set of standards and criteria to judge vendor performance. The key performance indicators must include both quantitative and qualitative methods for a complete vendor assessment.  

Timeliness, quality, cost, customer service, and so on are key metrics to weigh a vendor’s competency. But the monitoring must be an ongoing process if you want to yield long-term results. With vendor scorecards, companies can strategically evaluate vendors for ceaseless improvement.  

 5. Identifying risks

Risk is an unavoidable part of vendor relationships. But with proper vendor risk management, organizations can minimize the downsides of working with an external workforce. Businesses need to continuously assess to identify risks at every stage of the process. The impact of risks depends on an organization's risk management method. Dock VMS offers a centralized repository, secure storage, vendor notifications, and more to monitor and mitigate threats associated with vendor relationships. 

In a nutshell 

We already know that vendor management systems are critical to keeping up with all the external workforces associated with a business. Through different tools and features available through Dock VMS, companies can achieve the highest level of reliability, quality, and performance from vendors while limiting the risk. From vendor notification to active tracking, our VMS has it all. Get a live demo today to learn about all the benefits of our vendor management system.