But not every vendor relationship is created equal. A true, risk-based approach requires organizations to first segment their vendors based on pre-determined criteria, and then establish an appropriate level of ongoing due diligence and oversight activities based on the assigned level of risk. And while the specific activities may vary across organizations, there are three types of risk you want to be sure to address.

• Operational Risks
• Financial Risks
• Regulatory Compliance Risk

OPERATIONAL RISKS

Operational risk is the risk that your organization will experience a major failure, shutdown, or unexpected disruption of some segment of your business if a vendor’s processes, people, or systems fail. The operational risk goes hand in hand with your reliance on a vendor and is typically higher with vendors that provide services such as outsourcing, IT systems, and data.

There are two good ways to take a proactive approach and mitigate operational risk: perform periodic on-site and/or due diligence reviews and create a contingency plan should you experience a failure with a risky vendor. These two risk-mitigation activities go hand-in-hand, especially for mission-critical vendors. Monitoring daily performances that don’t meet the standards required is also a good indication that in a time of risk there is a higher risk of disruption or failure.

FINANCIAL RISK

Financial risk is the risk that your organization is negatively impacted financially due to a vendor relationship. This can come in two forms: excessive costs and lost revenue.

Poor Vendor Service due to Finances

Many supplier performance issues are related to finances.

Deliveries were late, and shortages were piling up with no relief in sight. The primary supplier was actively blaming the secondary supplier for the bottleneck, claiming that their supplier was behind in their coating process. They began casting aspersions on the supplier’s lack of process control, communication and even hinted at ethical issues.

While the protocol was for the primary supplier to manage all downstream relationships, this problem had escalated high enough that it was time to call the supplier directly to get to the bottom of the issue and develop a get-well plan.

Negotiating and Enforcing Contract Compliance

Organizations understand the importance of managing competitive solicitations and negotiating good pricing. But negotiating a good price has little to do with managing costs, which comes from enforcing contract compliance, effectively managing the procure-to-pay cycle, and performing periodic cost and contractual audits. It’s the work done after the vendor contract is negotiated that mitigates the risk of excessive costs.

The other financial risk relates to the reliance on vendors who support your revenue-producing activities. Examples include fundraising companies, outsourced service providers, and fulfillment centers, to name a few.

It may also include vendors whose technologies you use to process financial transactions. Problems with these vendors may delay access to revenue or, in the worst cases, result in lost revenue for your organization.

It’s important to identify and segment these types of vendors to design the most appropriate diligence and oversight activities and to also integrate with your vendor management operational risk planning as it relates to contingencies.

Regulatory Compliance Risk 

This has become a HOT TOPIC in many industries. Nonprofit organizations like health plans, healthcare systems, and credit unions, along with those that receive Federal grants, are heavily regulated by Federal agencies. And in many cases, certain regulations pass through to third-party vendors.

Regulatory compliance risk is the risk that a third-party vendor will violate a law or regulation that your organization has placed on them as a requirement for doing business with you.

Ensure your risk management activities enable you to evaluate how well your vendors are complying with the appropriate laws and regulations.

Even though a supplier may be remarkably reliable, the fact that their component or ingredient is essential to your finished product makes them high-risk. Partnering with a company that oversees these risks to proactively avoid business disruption is key to avoiding potential problems.

Audits aren’t just necessary for validating new suppliers––they’re an important tool for maintaining quality and compliance over time. The recent rise in outsourcing only further underscores the importance of having a plan in place to conduct regular evaluations led by skilled quality professionals.

Limitless Technology, LLC has been managing complex indirect spend and vendor documentation since 2006 for some of the largest companies in the USA saving them millions in costs.

Through our Billing Optimization and Vendor Management Solutions proprietary platforms, we utilize technology, processes, expertise, time, and resources to improve our client’s bottom line.

Limitless Technology manages your vendors, so you can manage and grow your business.

For Additional Information Contact us at 407.330.4466

We all understand the importance of overseeing our vendor ecosystem, but today we’re paying it a bit more attention as we realize the critical governance oversight it provides us. Our systems are uniquely positioned to act as a bridge that connects all of our stakeholders.

We have traditionally managed our vendors ourselves, as we feel this gives us better control over our vendors—allowing us to keep a hand in what is going on. However, more established enterprises are seeing the benefits of third-party management, bringing these specialists in to manage the day-to-day oversight of their vendors. Vendor management specialists can help manage transactional activity, collect operational data and even come up with suggestions for improvement.

By outsourcing management of our vendors, we can reduce our costs, improve service delivery, and place our focus on internal resources to help us develop richer relationships and higher strategic value.

Outsourcing certain jobs frees up everyone else in your business to focus on the areas they add the most value. An outsourced job usually requires a particular skill set unique to that industry, so having your existing employees pick up jobs they aren’t particularly trained for will take time away from their own specialized work, and will result in less-than-desirable results. You can’t expect your director of sales to also be an expert at marketing, just like you can’t expect anyone else in your company to quickly pick up the skills required of your own job.

When one individual is responsible for developing and managing an internal vendor management system, that information is often held by just that single person. When that person goes on vacation, takes time off for life events, or quits, the work is shuffled off to a backup who doesn’t necessarily know what to do. This can result in two problems:

1. The backup does it wrong. Tasked with vendor management, the backup will give it his best shot, but if he doesn’t know what he’s doing, he can easily make costly mistakes. This can create problems down the road.
2. The backup wastes a lot of people’s time asking questions. The backup wastes time reinventing the wheel and asking a bunch of questions that the vendor manager already asked.

Outsourcing creates stability. Losing an employee won’t mean losing systems, policies, and procedures. They are already developed and stored in an easily accessible place.

While there are many reasons why your organization would benefit from outsourcing your Vendor Management … Here are 6 of them.

6 Ways Outsourcing to a Fully Managed Vendor Software Solution Adds Visibility and Efficiencies to your Organization?

1. Cloud Based Repository. Increased Efficiency and Productivity.

Automatic Renewal Clauses (“ARCs”) or AUTORENEWALS can be golden for business. But for all their perks, ARCs are notoriously problematic. They may irritate customers who’ve missed the termination window, trap businesses in undesirable ongoing agreements, and undermine the validity of entire contracts. They act to perpetually renew a contract when no notice has been given to terminate it. So how can a business ensure they manage their autorenewal contracts to avoid termination penalties, increased fees, and being locked into an unwanted contract.

Keys to Managing Auto Renewals, Todd Larsen, CEO

3 Keys to Managing Autorenewal Clauses

ONE.

When you sign a contract set a recurring alert as a reminder to review the agreement. Organizations especially those with multiple locations have numerous contracts and agreements. Managing them ALL can become overwhelming. In most cases after the contract is signed, it is FILED and FORGOTTEN! Therefore, managing every contract and agreement is a must or the organization can easily miss autorenewals costing them thousands.

TWO.

Review the contract portfolio completely periodically. While it is certainly important to negotiate the best bargain for the organization, contract risk management increases IMMEDIATELY AFTER contract execution. Collecting autorenewal contracts with an unspecified duration for analysis can be TRULY illuminating! Questions to ASK …

• What percentage of all contracts are autorenewals or unspecified?
• How long ago was the oldest review?
• What types of contracts are auto-renewed? What departments, divisions, or subsidiaries are producing the most autorenewal contracts?

THREE.

If you chose auto-renewal contracts TAG them appropriately. One of the MOST COMMON MISTAKES made by finance, legal, and contract management departments is to open the spreadsheet of contracts and leave the “expiration date” blank. With a blank entry, it is not clear whether it was forgotten or if an expiration does not exist.

Most organizations have autorenewal contracts in their portfolio. Chances are that no one knows how many, how much money is at stake, and what the consequences are. With the three simple steps above you can help your organization master these challenging agreements.

The LIMITLESS Vendor Management Solution (VMS) Software is: fully managed software, enterprise-based, and generates high-level spend and vendor management metrics. VMS provides a SINGLE SOURCE tool providing transparency and visibility into all vendor management processes, documentation, invoicing, and costs.

Imagine all of your vendors at your fingertips in one FULLY MANAGED software solution. Tracking and managing contract auto-renewals is only one of the features of LIMITLESS VMS.

With a Vendor Management Solution, contract experts can negotiate a fixed rate for a particular service. The contract terms must be met ensuring that both parties are aware of what is expected and any variances will be flagged and the vendor will be held accountable for any charges and changes outside of the agreed terms.

Limitless Technology, LLC has been managing complex indirect spend and vendor documentation since 2006 for some of the largest companies in the USA saving them millions in costs.

Through our Billing Optimization and Vendor Management Solutions proprietary platforms, we utilize technology, processes, expertise, time, and resources to improve our client’s bottom line.

Limitless Technology manages your vendors, so you can manage and grow your business.

For Additional Information Contact us at 407.330.4466

Your company starts to grow, and you need more technology to keep up with additional staff, customers and to help improve the process. You are aware of the efficiencies and cost savings made possible by new technologies and are upgrading their infrastructures as a result.

But are you aware of How Purchasing more Technology can lead to Cost Creep?

Every CFO knows about “cost creep”; the slow build-up over time in the cost/revenue ratio. In today’s marketplace, there is an increasing number of service providers who can deliver more efficient solutions, giving end-users more options than ever.

In the beginning, new suppliers are on their very best behavior, cutting deals and slashing costs. The client will enjoy some pretty large cost savings during the first couple of years.

However, as the contract matures and becomes less visible to the client, costs begin to slowly creep up until, if unchecked, they can accelerate way beyond the initially agreed-upon amount.

When you purchase more services, your plans may mutate, creating new contracts that incur additional charges. Over time, small ancillary charges can appear but are not questioned, increasing your bills slowly. This “creep” may leave you paying for services you do not need and may not even understand.

Because data is at the heart of every business and it plays a crucial role in businesses staying connected, technology bills are perceived as a necessary fixed expense and are often overlooked even when the initial cost has increased yet services have not changed.

Companies, Organizations, and Businesses can easily incur monthly expenses ranging from thousands to tens of thousands of dollars each month. Managing the financial component of vendors can be a nightmare! Looking at just telecom you have: Multiple carriers, multiple contracts, introductory offers, equipment, and different locations. Just these factors can lead to poor financial management and procurement processes.

Learn how to improve vendor management processes and improve your bottom line! #stopcostcreep #reducecostcreep

With a Vendor Management Solution, contract experts can negotiate a fixed rate for a particular service. The contract terms must be met ensuring that both parties are aware of what is expected and any variances will be flagged and the vendor will be held accountable for any charges and changes outside of the agreed terms.

If you have questions about any of our VMS benefits contact us today at 866-504-4050 to learn more about our Vendor Management Solutions.

Vendor management is a core competence in successful business. In a competitive marketplace, businesses must look at creative ways to extract more value from providers, while reducing risk and upholding quality.

Simply beating suppliers down on price year after year is not a sustainable strategy!

Limitless Technology, LLC has been managing complex indirect spend and vendor documentation since 2006 for some of the largest companies in the USA saving them millions in costs.

Through our Billing Optimization and Vendor Management Solutions proprietary platforms, we utilize technology, processes, expertise, time, and resources to improve our client’s bottom line.

Limitless Technology manages your vendors, so you can manage and grow your business.

For Additional Information Contact us at 407.330.4466

As companies attempt to streamline their costs, an area that frequently gets overlooked is vendor management. This critical function of an organization is oftentimes plagued with errors and inefficiencies, especially if it has not been given the proper attention.

Problems include not knowing the exact services you have, SLA’s for providing the service and whether or not you’re paying too much. Recognizing the “whether or not” in itself is an enormous problem and a difficult task. However, there are unique service offerings and software based toolsets which companies can take advantage of to fully understand their current vendor environment.

Just as a retail store takes an inventory of what products are on their shelves, companies need to do an inventory of their vendor and supplier management systems. A expertly  managed VMS solution proactively measures and monitors your vendor environment, so you know where every penny is going and the value you’re receiving in return.

It’s easy for unnecessary services — (which in many instances go unused or provide little value) — to creep into your vendor invoice line items. The VMS system analytics gives you a 360 degree view so you can accurately gauge your situation, determine whether service changes need to be made and whether it’s feasible to reduce costs.

VMS is essentially helps analyze where a company’s vendor infrastructure is today and what modifications can be made to improve the organization tomorrow.

The end result of the VMS Service and Software is to ensure individuals responsible for their company’s vendor management can make better educated decisions about what they actually need, what risks are involved and how much to pay for them. Additionally, the data enables them to more effectively manage adds, moves or changes to  line items, equipment and services as their company expands. It puts users in control of their vended services which inevitably reduces costs, improves efficiency, mitigates risk and can save significant amounts of money.

Whether you’re being billed correctly or utilizing your vendors to full capacity will no longer be a challenge once you engage in a fully managed vendor management service. Once engaged with VMS, you will know what services you’re paying for, their true costs and the value they’re delivering to your organization.

In order to survive in today’s business environment, you must find ways to increase profitability, improve productivity and obtain a competitive advantage. A VMS solution provides you with some additional help to achieve this objectives.

Those that lead IT teams should harness this urge for savings by identifying experts (internal and external) that can streamline and standardize vendor processes. At the same time, these experts can reduce the costs that leadership seeks while creating a more organized and cost-efficient structure.

Read more to see a system many IT leaders have implemented across industries to help optimize billing and produce costs savings.

Outsourcing vendor management to a third party will also help standardize processes; and consistency helps enable the transparency essential to effective governance. This helps to alleviate flawed data, and costly mistakes.

Our software will not only house every contract, service agreement, warranty or renewal agreement, but we also manage negotiations for better rates and terms saving your business from unnecessary fees and costs while maintaining quality standards. If you have questions regarding how to manage vendor contracts/agreements or would like more information regarding our fully managed vendor management solution contact LIMITLESS at (866) 504-4050.

“Through 2019, EVERY dollar invested in innovation across a business will require an additional $7 in IT execution, which SVM leaders will have to manage,” said Claudio Da Rold, research vice president and distinguished analyst at Gartner.

Knowing the statistics on levels of investment, every business leader has a 7x greater reason to look more deeply into their IT operations and the vendors they choose! The question to ask is, “How do C-Level executives choose the right IT partners when knowing the cost to their organization is incredibly high?

How Do Executives Select the Right IT Vendors?

• When choosing the right vendors and suppliers, there are a few areas of focus:
  • Can the vendor handle the breadth and scope of infrastructure to handle the projects assigned?
    • Proper capabilities
    • Infrastructure in place
  • Does the vendor have a proven record of performance?
    • A History of achieving prior project deliverables
    • Recommendations of business leaders in similar industries

These points are a simple guide to assist leaders in determining the correct resources for their organization when a company directive is rolled out and a new IT resource needs to be chosen.

After Executives Select the right Vendors, Are Systems in Place to Manage Them?

A strong external IT resource will still need a focused system in place to manage their day-to-day impact on your business. However, one major problem in the IT industry is that company’s internal IT teams don’t have the time and, in most cases, the resources to manage their IT, Telecom, and VOIP systems at a micro-level. They are too busy managing the system-wide issues that arise daily and impact employees’ productivity on a ground level.

Often, IT teams leave secondary issues to handle a later time. The problem with these issues is that they often lead to costly expenditures for the organization. A short list of examples below:

• Products/services that are no longer needed by the organization due to a structural change in the business
• Billing discrepancies caused by disconnect from ground-level teams
• Small issues impacting individual locations as opposed to company-wide outages

C-Level executives need to understand the cost impact leaving these issues unresolved can cause their organization. A cost-effective strategy is to employ a third-party organization with the skills and ability to manage the above issues, so that internal resources can focus on “putting out the fires” that are an immediate need.

Find out more about our company and how we assist in managing both processes here.

This includes IT services, office supplies, delivery services, utilities, rentals, and the goods needed to run business day to day. GET entire list of vendors here. When you consider the myriad of services and supplies businesses need in order to operate strategic management of those service providers and vendors – they need to be first and foremost the core of importance, but you’d be surprised at how often it isn’t.

Most companies might think their vendor management solution is “just fine the way it is”, and in some cases that might be true. The real issue is that only a few businesses know exactly what to even LOOK FOR or even where to begin, and without that information they might find that their current process is lacking in more ways than one.

So how do you ensure you have the BEST VENDOR MANAGEMENT SOLUTION?

You must consider availability of all billing, agreements and documentation. How easily accessible is every document related to every vendor? How updated is the information? How efficient is the management process? Do you feel any time is wasted in finding, organizing, interpreting and optimizing? Is billing fair? Are there any errors in billing, oversights, overcharges or invoices for services not even rendered? How often is all vendor related information from billing to contracts evaluated? Rated? What about the quality of the service … Is quality being accessed?

Vendor management is more than getting the lowest price. Most often the lowest price also brings the lowest quality. As the saying goes: “you get what you pay for”. Be careful not to short-change the vendor by trading off quality as this could have a profound impact on your own business. The key is for BOTH SIDES to align on what constitutes as quality and a good value. You and your vendors should be willing to negotiate a fair price while receiving the expected quality. If the vendor is serious about the quality they deliver, they won’t have a problem specifying the quality details in the contract.

Because vendor management inherently means dealing with a great deal of third party businesses, services and providers, it would be ridiculous to assume that one solid strategy will never need tweaking, reviewing and changes as time goes by. Vendors change their prices from time to time and in order to ensure you get the best deal, it’s important to keep an eye on any new pricing, billing or contract changes that could either benefit or hurt your business.

Reevaluating vendors is an essential part to ensuring the “best for the best”. Every time you reevaluate, you’ll find changes – be it somewhere you can save money, somewhere you can optimize efficiency and performance, somewhere you can spend less resources and so on. For these reasons, it’s important to deal with a vendor management service that is always thinking about what to do next…

LIMITLESS offers a fully managed solution to ensure you are “paying for what you are receiving”. Ensuring contract terms are met as well as compliance standards. Tracking any potential risks, optimizing your billing and managing all contract and agreements in one central software solution.

Outsourcing vendor management to a third party will also help standardize processes; and consistency helps enable the transparency essential to effective governance. This helps to alleviate flawed data, and costly mistakes.

Our software will not only house every contract, service agreement, warranty or renewal agreement, but we also manage negotiations for better rates and terms saving your business from unnecessary fees and costs while maintaining quality standards. If you have questions regarding how to manage vendor contracts/agreements or would like more information regarding our fully managed vendor management solution contact LIMITLESS at (866) 504-4050.

Improper management leads to duplication of accountabilities and capability gaps and overlaps, which can result in increased costs and missed business opportunities.

“By collaborating effectively, SP&VM functions can work toward common objectives, and transform from inward-focused teams to a combined outward-focused group that is engaged and motivated to work together to meet the future challenges of the organization,” says Luke Ellery, research director at Gartner. (www.gartner.com: Resource)

“Gartner estimates that organizations spend an average of 62% of their technology budgets on vendor products, services and outsourcing.”

Sourcing, procurement and vendor management are disciplines that must align with the most available souring options to allow the business with the speed and agility to grow. This alignment must be accomplished in all vendor industries especially technology where markets are rapidly growing. All markets must be continually evaluated, revised and measured against changing business priorities, market disruptions and new opportunities.  Engaging with potential vendors, negotiating with them, buying from one or more of them in the same industry to facilitate transitions between vendors when a replacement decision needs to be made in order to ensure performance and achievement objectives and quality of service are maintained. Vendor management is not a one-time event, but rather an ongoing management function.

Setting the ground rules for vendor engagements outlines the frameworks and policies for effective governance.

The three disciplines of sourcing, procurement and vendor management have to be clearly outlined, roles and responsibilities documented, and work together to plan and execute these objectives.

With LIMITLESS, Vendor Management Solutions, we partner with each member of your team so they feel confident they can maintain the overall control, won’t lose the vendor relationships they value but, WILL gain the critical support they need to make better decisions. The support we provide allows your team to focus on the important work of ensuring occupancy rates, delivering exceptional resident experiences, and grow their business and market shares.

Nationwide: 866-504-4050.

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