Vendor Relationship Management (VRM) is a structured approach to managing and continually improving your business’s interactions with external vendors that supply goods and services to you.
Despite the advancements in technology, some businesses still rely on manual, traditional methods for managing these relationships.
This approach, often characterised by scattered data, lack of real-time visibility, and reliance on outdated communication methods, can lead to significant challenges.
In regulated industries, where compliance, data integrity, and operational reliability are paramount, the drawbacks of manual vendor relationship management are even more pronounced.
Healthcare, Finance and Biotech businesses face severe consequences if found to have inefficient vendor relationship management processes. Whether it’s failed audits, fines or operational disruption, these events can have huge ramifications for your business."
At Gatekeeper, we know that vendor relationship management (VRM) software can prevent some of these issues. In this article we’ll look at:
- Traditional vendor relationship challenges in regulated industries
- VRM software features your business should prioritise
- Police Bank's success story with Gatekeeper
Traditional vendor relationship management challenges
At Gatekeeper, we help customers in Finance, Healthcare, Insurance and Pharmaceuticals, to overcome specific business pains that necessitate robust VRM solutions. These pains revolve around three critical pillars:
- Having visibility: In regulated industries, a lack of visibility into vendor activities and performance can lead to significant compliance and operational risks. Manual methods often result in fragmented and outdated vendor data, making it challenging to track performance metrics or compliance statuses effectively.
- Being in Control: Without a centralised VRM system, organisations in regulated industries struggle to exert control over their vendor relationships. This includes slow vendor onboarding, difficulties managing contracts, limitations with ensuring adherence to regulatory requirements, and effectively responding to vendor-related risks.
- Safeguarding Compliance: Regulated industries are subject to stringent regulatory requirements such as HIPPA, PCI DSS and GDPR. Manual vendor relationship management methods can lead to gaps in compliance tracking and documentation, increasing the risk of regulatory breaches and the associated penalties.
Vendor relationship management doesn’t start or end with your third-party vendors. You need to consider what goes on downstream because any non-compliance throughout your supply chain can easily ladder up into your corporate responsibility.
“Many organisations are still unaware of the dependencies and exposures inherent to third-party relationships and simply focus on managing their own security posture. Others are aware of those issues but don’t make vendor decisions based on security and/or require vendors to meet certain standards. Even firms that do establish third-party security requirements can struggle to continually monitor compliance and progress.” - SecurityScorecard
Relying on traditional methods can exacerbate issues. Most vendor risk, such as non-compliance, is a direct result of not knowing what you don’t know. Watch the video below to find out more.
Must-have VRM Software features
Gatekeeper is designed to streamline vendor management processes, ensure compliance, enhance performance monitoring, and mitigate risks.
Let’s take a look at some vendor relationship management features below.
| VRM Feature | Description | Benefits |
|---|---|---|
| Vendor repository | A centralised database within Gatekeeper for securely storing and managing all vendor-related documents and information. This feature is designed to keep all vendor contracts, communication records, and compliance documents in one accessible location. | Facilitates efficient vendor information management by providing a single source of truth for all vendor data. This repository ensures easy access to vendor documents, enhances data security, and supports better decision-making with comprehensive vendor information. |
| Vendor Portal | A self-service solution that enables businesses to collaborate with vendors in a secure online environment. It allows for vendor registration, onboarding, information collection, and ongoing management, all hosted on a branded portal with your URL. | Improves efficiency by streamlining vendor management processes, offers a centralised location for vendor data, and automates key aspects of vendor collaboration. The Vendor Portal is a collaborative hub where you manage and track all interactions. |
| Messaging Centre | A dedicated area for collaboration with vendors, which can be used within the Workflow Engine and Vendor Portal. Attach files to messages, so that everything is in one place. Add comments against an existing thread and include users who do not have access to Gatekeeper. | Collaborate, notify vendors of action required and keep a full history for audit purposes. Build stronger, more effective partnerships by improving communication and increasing transparency. |
| Kanban Workflow Engine | A visual tool to configure and trigger workflow processes for vendor onboarding, invitation, documentation updates, and performance reviews. | Enables clear visualisation of vendor-related processes, aiding in efficient management and oversight of vendor activities. |
| Market IQ Suite | A suite of tools that offers you sophisticated and up-to-date insights into the financial, cyber and ESG risks associated with your vendors. All information is centralised within the vendor repository and automated alerts can be sent to vendors if there is a downward trend. | Enhances risk management by informing you - and your vendors - about significant changes in your vendors' status, aiding in proactive, collaborative decision-making. |
| Risk Module | Manages supplier risk by triggering escalation and workflows based on risk assessment. It includes tools for comprehensive risk evaluation and management. | Improves risk management practices by providing tools for assessment and escalation, ensuring compliance and mitigating potential risks associated with vendors. |
| Events | Events from Gatekeeper allow you to automate communication with your vendors. Configure reminders for important tasks, such as due dates and assign them to your vendors to drive action. | Setting and assigning Events for important tasks and due dates ensures timely actions from vendors, reduces the risk of non-compliance, and minimises manual follow-ups. Automatic alerts enable proactive vendor management, while consistent and error-free communication fosters better, more collaborative relationships. |
| Integration Support | Gatekeeper offers extensive integration support with over 220 third-party solutions, including NetSuite, for seamless data synchronisation. | Facilitates operational flexibility and consistency across systems, streamlining data management and reducing the need for manual data entry. |
By continuously monitoring and evaluating vendor risks, your organisation can mitigate potential threats, such as data breaches or non-compliance with regulatory standards, which can have significant legal and financial consequences.
Vendor Relationship Management Case study
Before working with Gatekeeper, Police Bank experienced pain points with onboarding third-party suppliers. The business came to market for a solution that could:
- Reduce supplier onboarding time through automation
- Help achieve and maintain flawless compliance with regulatory requirements
- Replace manual processes associated with vendor and contract tracking
Since working with Gatekeeper, Police Bank has been able to build all necessary assessments, due diligence checks and a full audit trail of all vendor processes. Visibility has increased, there is transparency over third-party supplier management and processes have been streamlined through workflows.
Read the case study below to find out more.
Wrap Up
This holistic approach of combining VLM, CLM, and TPRM - known as VCLM - empowers regulated industries to:
- Manage their vendor relationships more effectively
- Ensure compliance with contractual and regulatory requirements
- Mitigate risks associated with third-party engagements
If you’re ready to improve your approach to your vendor relationships, speak to one of our experts today.
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