While manual processes to get supplier data into your ERP are time-consuming and error-strewn, Canopy automates and refines the procedure.
In many organisations, the ERP sits at the heart of operations. It must be a robust and solid system because it governs the financial position of the business. But because of this rigidity, there are natural shortfalls in what the ERP can be configured to do when it comes to dealing with suppliers. While there's a lot of supplier information captured at the onboarding process, it's not always easy to keep it updated. And this supplier information isn't always readily available across a business. But we've got an agile, cloud-based platform that makes the most of all that supplier data for procurement teams. That's the beauty of Canopy. In this blog, we're asking you: how do you get supplier information into your ERP? We make a case for automating your processes to save time, reduce errors, and make your relationship with your suppliers better.
The downlow on ERP
All businesses need to record accounting information from sales and purchase ledgers, purchase orders, invoices, and payments, through to managing creditors and debtors. This information was one of the first areas of business which benefited from the IT revolution in the late 1980s. Throughout the 1990s, accounting systems became more complicated and ambitious, branching out into resource and manufacturing planning. It's when the term ERP (enterprise resource planning) first gained currency. And it spawned such systems as SAP, Microsoft Dynamics, Oracle Financials, PeopleSoft, and iScala.
These are big systems, but they're not very flexible and there's usually limited access across a business due to the cost of licenses. Many companies use ERP as a main data source for supplier information. But for procurement teams, detailed answers on practical questions such as insurances, qualifications, risk, and compliance can be hard to come by through the ERP, where the fields simply do not exist.
Manual systems are time-consuming but not timely
Of course, many businesses use a manual process to enter supplier data into an ERP. It's a process that has several downsides. In a typical ERP, there may be 35 fields of data to add to a supplier record to onboard a new supplier to the system. It could easily take an administrator 30 minutes per supplier to add this data. What if you have 10,000 suppliers? The sheer scale of necessary resources acts as a disincentive to onboard new suppliers, which may mean you're not getting the best value in competitive fields.
What's more, the ERP doesn’t necessarily help with understanding a supplier's attributes. For instance, business names can be misleading. ABC Taxis may operate in multiple cities, but you only know about the services they provide in Aberdeen because that's where you used them previously. If the ERP shows they're based there, you might not know they also operate in Birmingham and Chester, and they can supply other (transport) services. So there can be a converse tendency to let the number of suppliers of similar services in different locations to get out of control.
Canopy to the rescue with automated updates to the ERP
How can you ensure you have the best data on your suppliers in your ERP? Trying to build automations into the ERP directly takes time, costs a lot of money, and is very inflexible when you need to make changes quickly. This is where a system like Canopy comes into play. With Canopy, building automation workflows is easy, as we use API or batch processing to feed information through from Canopy to the ERP. Here we highlight five advantages that Canopy has over manual processes to update the ERP:
1. Saving time and resources
It takes time to onboard a supplier using an ERP (for instance, typically 30 minutes with SAP). In contrast, with Canopy, it takes a minute to send an invitation to a supplier to provide their information which then feeds the ERP via an API. Of course, the data needs review after submission, but this is a much more straightforward process. What's more, we don't license our platform by user numbers, so both supplier contacts and the stakeholders across your business have access to review the data according to their business function.
2. Reducing the scope for mistakes
With manual processes, there's scope for multiple mistakes when onboarding a supplier. As a single-threaded, time-consuming process, there is often an urgency to adding new suppliers. This means there may be shortcuts, which are more likely to breed mistakes. And with inadequate processes to go back and re-check information over time, data may not be current and therefore may not be reliable. This means you could be dealing with a non-compliant supplier - whereas Canopy can send a trigger to the ERP which puts a non-compliant supplier 'on hold' for POs or payment.
3. Coping with multiple ERP systems
What happens when two (or more) companies using different ERP systems merge? Again, it's a complex and time-consuming process to merge and manage legacy ERPs, so companies will typically run ERP systems in silos. The Canopy platform can speak to multiple ERP systems concurrently , as the API can push and pull data to and from multiple ERPs simultaneously. The front page of the platform has all the information on suppliers in one place (the vendor master record), regardless of the ERP(s) that sits behind the data.
4. Getting the best from your suppliers
Canopy generates an invitation to onboard a supplier to provide specific goods or services in a particular place: what they do and where they do it. The supplier can then add additional information about their geography and business function, using tag words that help you to home in what they can supply. This provides an incentive for a supplier to market themselves to you as their client. And it avoids the risk that generic business names don't give you enough information about your suppliers.
5. Being easier for your suppliers to work with
It's also important to think about how easy it is for a supplier dealing with your company. At times of crisis, it can be a supplier's market. If it's more straightforward to deal with you than another company procuring their service, a supplier is more likely to choose to work with you than your competitor. Never underestimate the benefit of being a customer of choice for your suppliers.
To find out more about OCG Software and Canopy, and how our award-winning supplier management platform automates your ERP supplier information processes, contact one of the team today.
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.