Executives and managers already understand how vital it is to manage employees. However, for those who work in the supply chain industry, there is the added difficulty of vendor management challenges.
Creating efficient and healthy relationships with your third-party partners is essential to this sector, and it could mean the difference between failure and success.
In order to generate sustainable growth, effective vendor management is key — but it requires attention and care.
For instance, one of the most common obstacles in vendor management is excessive administrative costs. Decreasing these expenses requires attentiveness, especially when it comes to assessing processes for reporting, workflow and data collection. Otherwise, you could be duplicating efforts and spending more time and money than is necessary.
Another recurrent mistake that executives and managers make is overlooking the flow of communication. Direct, consistent contact with your vendor could help avoid confrontational situations and unhelpful disagreements. This is why it is critically important to maintain an open line and discuss issues as a team.
Furthermore, when working with outside parties, many companies make the mistake of leaving their information unprotected, opening the door to data breaches. If you are sharing a software platform with a third-party partner, make sure that it is secure with all the appropriate measures.
Many decision-makers have difficulty juggling the responsibilities associated with third-party vendors. In turn, these relationships suffer and hinder the profitability and productivity of the rest of the company.
However, if you take the time to build strong partnerships between your organization and the third parties who help you, those responsibilities become easier to manage.
For more great information on common challenges and solutions in vendor management, look over the accompanying infographic on overcoming vendor management challenges.
Infographic provided by American Transport Group.