Even the smallest procurement team often deals with thousands of suppliers, and Canopy offers a solution that makes managing relationships possible.
It may be a 'team' of one person, but in many businesses, the procurement function has many hundreds, or even thousands, of suppliers to look after. They'll be responsible for onboarding, assessing risk, monitoring compliance, and ongoing relationship management. As we know from our experience speaking to procurement professionals, that can be overwhelming without the proper support (in the form of both management buy-in and technology). In our latest blog, we investigate the challenges that procurement professionals face, and how Canopy can boost the power of procurement, however small the team.
Tiny team, huge responsibility
In our experience, procurement teams are often swamped, especially as many small- and medium-sized enterprises (SMEs) only have a single procurement person. In that sort of business, an individual could be handling 500-2,000 suppliers. Historically, it's been an outbound relationship; procurement sends out a new supplier questionnaire, often as a Word document, which they then need to chase. When the completed questionnaire does arrive back, they'll probably have to enter salient details into the ERP. And the data for each new supplier will take up to 30 minutes to enter into the system. Once that's done, most questionnaires will be filed in a drawer (or an electronic equivalent).
Often, procurement has no time to complete basic checks such as a supplier's financial risk. This can mean that big compliance issues get kicked into the long grass. One crucial example that we've frequently heard of is the difficulty in scheduling checks for updated insurance certificates. Again, this will often require chasing busy suppliers. And this is especially important where the supply chain is decentralised (for instance for FM, maintenance, and property management companies, and housing associations). It can be a particular challenge to manage on-site visits across a portfolio of properties and ensure compliance at an individual level.
Third-party vetting may add to the problem of fragmented supplier data
Of course, there are third-party applications which can handle certain elements of vetting suppliers. Companies such as Achilles, Avetta, Ecovardis, RISQS, SafeContractor, and GRMS provide a level of comfort that a supplier meets operational criteria. And procurement teams can also gauge credit risks by using such companies as D&B or CreditSafe.
Ignoring the cost, one of the problems with relying on these third-party sites is that it can fragment supplier data. This can already be a problem for procurement, given supplier data held on the ERP isn't searchable. If you add in potentially three or four third-party compliance applications, it can be a bewildering task to find the information you need on a particular supplier. For instance, one large UK construction company we've been speaking to has around 10,000 suppliers. It manages some operational risk via Avetta, some via Achilles, some via RISQS, and many are in none of these. That's a lot of systems to sift through to check supplier compliance.
Another element of data fragmentation comes with different levels of category approval. This can be difficult to manage across disciplines, geographies, or business units. For instance, a supplier may be approved for HVAC, but not for electrical installations, due to different applications and methods of achieving compliance for each category type.
Canopy provides a solution with visibility and control
With Canopy, supplier management becomes more of an inbound relationship, freeing up valuable procurement time to look at broader business goals. The onus is on the supplier to keep themselves compliant. And with the ability to block non-compliant suppliers, procurement can gain an additional level of comfort. For instance, the platform sends automated emails to suppliers signalling that key compliance documentation is about to expire. It will also explain which documents they need to update to maintain their profile in the platform's search results. It's a two-minute process for the procurement team to ensure that their suppliers have uploaded the requested updated documents.
Suppliers too can recognise the benefits of this system, as it's a simple process to upload new data as required. Canopy also pulls in information via API from third-party sites, be that for compliance or credit risks. And with multi-faceted approval through the supplier onboarding form, different teams within an organisation can overcome differences in category approvals. That way, compliant suppliers can be considered in all the areas where they operate.
ERP doesn’t give you the visibility of supplier data beyond the transactional side; for instance, there's no view of a supplier's risk profile. In contrast, Canopy has all the supplier data in one place. And with visibility comes control. If you want to see all your suppliers on one dynamic dashboard, then Canopy could be the solution that boosts the power of procurement in your business.
To find out more about boosting the power of your procurement team via Canopy, our award-winning supplier management platform, contact one of our team today.
Visit: www.team-canopy.com
Email: hello@team-canopy.com
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Post by Doug McLean
Doug is an experienced business leader and the Founder of Canopy (OCG Software), the rules-based Supplier Management platform. Doug's focus is ensuring our clients maximise the opportunities that Canopy offers, to achieve commercial and operational excellence.