Gather ‘round, friends, and we will tell you a tale of destruction, selfishness, and loss. It’s a scary scenario that is, frankly, all too common in the world of Supplier Networks. Supplier Networks provide a software infrastructure that connects to suppliers electronically for management of POs, invoicing, and all of the other required AP components. While the end result of converting to a Supplier Network has some advantages, that conversion would require a lot of time and labor from your vendors to comply with the new system requirements. We know the last thing you want to do is ask your critical vendors to jump through hoops to give you a little added efficiency. In fact, some Supplier Networks require burning bridges with your suppliers and vendors. Is that truly efficient? How is that going to impact your bottom line?
When you partner with DataServ on AP automation solutions, your success becomes our mission. We not only value our relationship with your organization and your employees, but we understand how important your organization’s vendor and supplier relationships are. We take pride in preserving those relationships and maintaining efficiency throughout your P2P processes. But you don’t have to take our word for it. Our AP clients recognize the value and efficiency they have achieved with our paperless OCR-intake approach (in whatever format it comes in) that delivers clean and useable data – all while ensuring 99% pre-ERP accuracy. DataServ creates a digital stream for purchase orders, invoices, and receipts, so there will be very little time required from your staff, vendors and suppliers to interact with our AP processes. Our clients know that DataServ would never want you to sacrifice your valuable relationships in order to adopt our solutions.
The Threats Begin
We have heard the horror stories from our own AP clients who were informed that the Procurement office of their own department was moving forward with a clumsy, forced rollout of a Supplier Network after AP had worked diligently to negotiate payments and discounts with suppliers and vendors. Our AP clients are embarrassed to see these email threats to their vendors, and disagree vehemently with the attempt at strong arming the vendor to take on additional work and cost in order to comply. Many of their vendors just won’t convert to the new Supplier Network, even when they receive a strongly worded email warning “your purchase orders (POs) and invoices will ONLY BE transmitted using this new platform.” That means you could be losing a key vendor to your operations if they refuse compliance or at minimum creating paperwork that now falls outside the process. When we hear this horror story from our AP clients, we understand their frustration. It’s a classic case of the right hand not knowing what the left hand is doing. Don’t let your hard work and efficiencies be undone by Supplier Networks chosen by your coworkers!
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AR Fights Back
We work with a lot of large global companies on the AR side and they’re adamantly against Supplier Networks because of the added demands on their Financial Operations resources, both in terms of time and direct costs. For most of them, the time is more difficult to swallow than the cost as many companies are not hiring additional staffing in Financial Ops. A forced change in their AR process means using overtime from the people they have today that were already feeling overworked. Not only is this expensive, they know that these overworked folks will eventually burn out and find new jobs. Add to that the number of customers these companies must bill — and you realize why they hate the concept of closed loop networks.
Worst Case Scenario
Let’s say you have 5,000 customers and they all use a different Supplier Network — each with a different set of systems and rules — how would you ever interface with them all? Now assume that even one of those customers change their Supplier Network. Or the Supplier Network changes its rules, which happens all the time. Of course, you know there will be even more change when you take on new customers who are on yet another Supplier Network or when you change the products or services you provide.
Thrown into the Lion’s Den
Because we work closely with our clients, we have been involved with the implementation and rollout of several of these Supplier Network solutions. One thing we hear over and over is that it is a daunting task to convince vendors to change their business processes. Many vendors are understandably not interested in adding cost or hours to their Financial Operations team. All vendors have their own business process around AR and billing, a process that must change in order to meet the Supplier Network’s requirements. Supplier Network providers do offer vendor onboarding services — for a fee. Clients who have attempted to do their own onboarding tell us that they had to have very experienced resources calling and meeting with vendors to help fully understand and successfully meet the Supplier Network requirements.
Sit Tight, Help is on the Way
DataServ understands the importance of maintaining and improving relationships with suppliers. If you had a choice between automation solutions that saved you money but are a burden to your suppliers, or the solutions offered by DataServ which can benefit you without burdening your suppliers, we know DataServ can help you achieve optimum Supplier Relations Management (SRM) outcomes. In a 2013 report on SRM, Price Waterhouse Cooper (PWC) found that the average company’s SRM maturity level is low, and that not enough resources or planning are put into the SRM process. PWC also found a “positive correlation between the presence of SRM and an increase in market share, responsiveness to market changes, increased return on investment and shortening order fulfillment lead times.” The previously mentioned supplier networks make the SRM function secondary to efficiency. Is it worth using supplier networks just to increase market share and increased ROI if it means jeopardizing your supplier relations? DataServ offers automated AP services that put SRM first, increasing marketing share, responsiveness to market changes, increased ROI and shorter order fulfillment lead times ALL WHILE preserving the valuable supplier relationships you’ve built.
From our inception we created solutions that are:
- Pragmatic, sustainable, and affordable for real-world process automation challenges
- Delivered as a service - before there was a Cloud
- Tailored to your business
Our incredible, long term relationships with clients demonstrate one of our core beliefs: evolution.
So, as you explore and compare SaaS solutions that automate your Accounts Payable and Accounts Receivable, you should expect more. You can trust DataServ with your valuable supplier relationships, and we hope you will reach out to learn more about why DataServ’s services give you all the cost savings and efficiency in AP processes that you are looking for without putting any added burden on your suppliers.