Your Vendor Administrator is a Liability

by Ashley Poynter

Content Manager

Your Vendor Administrator is a Liability

Once upon a time, in the not-so-distant past, the vendor administrator was tucked away behind mountains of paperwork, deep within the labyrinth of administrative duties. I know you can picture the scene: a cramped office filled with filing cabinets, where each vendor document lay like a leaf fallen from a massive bureaucratic tree. It was a world where process trumped progress, and the vendor administrator’s role was often as static as the files they managed.

Well, it’s 2024 and things have changed. Vendor managers are no longer merely custodians of W9s and invoices. They are considered champions of strategy, masters of data, and defenders against fraud. In other words, your vendor administrator is no longer a strictly clerical function (at least it shouldn’t be). Organizations are increasingly leaning on these folks to optimize processes and payments, create a strong mesh of security and compliance, and shield the organization from the financial and reputational harm that comes from fraud.

Yet, so many organizations are still looking at this role as a simple vendor administrator. A paper pusher. A filer. A mailer. And I’m here to tell you this is a mistake. It’s a mistake because it’s a liability – and it could end up costing your organization more than you bargained for.

The Evolution of the Vendor Administrator Role

The High Cost of a Manual Vendor Administrator

— A drain on resources

— Error-prone processes

— The opportunity cost

Why Resistance to Automation is a Liability

— Amplified fraud risk

— Financial follies

— Compliance catastrophes

— Missed strategic opportunities

From Vendor Administrator to Value Creator

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The Evolution of the Vendor Administrator Role

Let’s take a moment to rewind the tape back to not so long ago when vendor administrators were often seen as the backstage crew of the business world. Picture them surrounded by stacks of paper, buried in spreadsheets, and knee-deep in clerical tasks that, while necessary, didn’t exactly scream ‘strategic importance.’ Fast forward to today, and oh, how the tables have turned.

The transformation of the vendor administrator role is nothing short of a corporate Cinderella story. These once behind-the-scenes operators have stepped into a role that’s critical, strategic, and, dare I say, a bit glamorous. But this didn’t just happen overnight. It’s the result of a rapidly evolving business landscape where efficiency is king, and data is the crown jewel.

From paper pushers to gatekeepers of profit

Today’s vendor administrators are the new gatekeepers of organizational spending and security. Their role has pivoted from mere data entry to encompass guarding the fort against fraud—imagine them as the modern-day knights in digital armor. Social engineering, phishing scams, you name it, they’re on the front lines, armed not with swords but with sophisticated software tools that sniff out fraud attempts before they can wreak havoc. Sharon Loosman, Director, Procurement & Business Services, and Megan Catt, Supplier Information Manager, both of North Carolina State University, are great examples of this in action, as you can hear below:

The analytical alchemists

But it’s not just about defense. These professionals are now pivotal in turning what was once a cost center—how an organization pays vendors—into a potential profit center. How, you ask? Through the magic of strategic payment methods like virtual cards, which streamline processes and kick back rebates and rewards, sweetening an organization’s bottom line.

The value creators

Step into any forward-thinking business today, and you’ll find vendor administrators deeply involved in strategy meetings, their insights shaping decisions that go well beyond the procurement department. They analyze vendor onboarding and change data,, push for cost-effective process iterations, and implement technologies that drive operational efficiencies. They are not just supporting the business; they’re actively driving its growth.

Why this evolution matters

So, why all the fuss about this evolution? In a world where business moves fast, and risks lurk around every corner, having a strategic thinker in what was once a clerical role is not just an advantage—it’s a necessity. Organizations that recognize and empower these transformed roles are the ones staying ahead of the curve, turning potential liabilities into compelling opportunities for innovation and profit.

This transformation creates a bit of suspense: What new heights can your business reach if you unleash the full strategic potential of your vendor administrators? The answer could redefine your competitive edge.

The High Cost of a Manual Vendor Administrator

Imagine a world where cell phones exist, but your organization insists on using a rotary phone. “This is the way we’ve always done it,” someone in charge says with a shrug.

Sounds impractical, right? That’s exactly what you are doing when you continue to stick with a manual vendor management process in 2024.

Even so, many organizations (maybe even yours?) continue to rely on outdated manual processes for managing vendors. These organization’s are stubbornly stuck seeing vendor administrators as low-level, clerical workers. Because, yes, ‘that is how we have always done it.” Tsk.

It’s well past the time to innovate. Leaving this function with the rotary phone in a digital age is costing you more than you realize.

A drain on resources

First off, manual vendor management is like trying to fill a bucket with a hole in it—you can keep pouring resources in, but they’ll just leak out through inefficiencies. Picture your vendor administrators spending their days manually entering data, vetting each vendor by phone, and shuffling papers. It’s not just time-consuming; it’s a monumental waste of human talent. Every hour spent on these repetitive tasks is an hour not spent on strategic activities that could propel the business forward. Moreover, vendor administrators are constantly at odds with competing priorities, putting the organization at risk for fraud, which Jim Vogt, CEO and Founder of the Fraud Protection Institute, points out below:

Error-prone processes

Now, add human error into the mix. Each mistake in data entry or missed step in a manual check isn’t just a minor hiccup—it’s a potential crack in your organization’s armor. These errors can lead to incorrect payments, compliance mishaps, and even fraud. It’s like walking a tightrope without a safety net, where one slip could have disastrous consequences.

The opportunity cost

And let’s talk opportunity cost—the ultimate hidden fee. With your team bogged down by manual processes, think about the strategic initiatives they’re not executing. Could they be negotiating better vendor terms, auditing and cleaning your vendor file, or analyzing spend to find savings? Unfortunately, in this manual world, these opportunities might as well be mirages in the desert—visible but out of reach.

Why Resistance to Automation is a Liability

Holding on to manual processes in an automated world isn’t just old-fashioned; it’s a strategic misstep that poses real risks. Moreover, it has costs:

Amplified fraud risk

Firstly, manual systems lack the sophisticated checks and balances that automated systems offer. Without robust verification processes, your organization is a more tempting target for fraudsters. They’re like sharks that smell blood—a little whiff of manual vendor onboarding processes, and they’re ready to attack. Automated systems help shield you from such vulnerabilities, acting like a fortified wall against the onslaught of scams.

Financial follies

Think about the financial implications. Automation isn’t just about cutting costs; it’s about enhancing revenue streams through strategic measures like dynamic discounting and optimized payment terms. Sticking to manual processes means you’re likely leaving money on the table—money that could be reinvested into growing your business.

Compliance catastrophes

And then there’s compliance. Manual processes can make it incredibly difficult to maintain and prove compliance with regulatory requirements. It’s like trying to fill out a complex tax return with a crayon—messy, difficult, and likely not going to satisfy the authorities. Add up your organization’s B Notice fines for a taste of the cost.

Missed strategic opportunities

Finally, resisting automation means you’re missing out on leveraging big data and analytics, tools that could dramatically improve decision-making and strategic planning. (Quick, what is your organization’s DPO?) Without these insights, your vendor management processes are not just inefficient; they’re operating blindfolded.

Clinging to manual processes in vendor management isn’t just inefficient—it’s a strategic liability. It’s akin to choosing horse-drawn carriages over high-speed trains. The organizations that recognize this and embrace automation and strategic vendor management will be the ones speeding ahead, while others are left in the dust of obsolescence and vulnerability. The question remains: Where does your organization want to stand in this dynamic marketplace?

From Vendor Administrator to Value Creator

Transitioning vendor administrators from clerical to strategic roles is essential for businesses looking to thrive in a competitive market. Precision and strategy lead the charge in business operations, and the evolution of vendor management from a mere administrative task to a critical strategic function isn’t just beneficial—it’s essential, which Tom Rogers, CEO and Founder of Vendor Centric, explains eloquently below:

Let’s delve into why transforming this role is non-negotiable for businesses aiming for the top.

Embracing the automation revolution

First and foremost, embracing automation in vendor management is like upgrading from a manual typewriter to a high-speed computer. Automation doesn’t just streamline operations; it transforms them. Picture this: what once took days of manual checking now unfolds in moments without a single paper cut or entry error. This shift frees up our vendor managers to focus on what really matters—strategy and innovation.

Unlocking the strategic potential

With the mundane tasks automated, vendor managers become strategists. Their role blossoms into analyzing vendor performance, maintaining a compliant vendor database, and identifying opportunities that can lead to cost savings or even revenue generation. This is where the magic happens—they’re no longer just checking off tasks; they’re crafting a vendor ecosystem that aligns perfectly with the company’s strategic goals.

The power of data

Armed with tools that offer real-time analytics, vendor managers can now predict trends, prepare for market changes, and make data-driven decisions that were once based on gut feelings or outdated reports. Imagine having the foresight to adjust your strategies on the fly, minimizing risks and capitalizing on opportunities at the speed of light.

Continuous improvement and compliance

In this new world, vendor managers are also compliance champions. Automation ensures that compliance is not just an item on a checklist but a built-in feature of the vendor management process. This proactive compliance monitoring guards against potential legal issues and builds a robust framework that supports sustainable business growth.

The strategic shift: operational efficiency and beyond

Transforming vendor management into a strategic role does more than enhance operational efficiency; it turns potential risks into bulletproof strategies.

Risk mitigation: Advanced screening and monitoring tools detect risks before they become threats, making the business more resilient against fraud and compliance slip-ups.
Cost management: Strategic vendor management goes beyond cutting costs—it redefines how resources are allocated, ensuring that every dollar spent brings added value to the company.
Innovation at the forefront: With more bandwidth, vendor managers can explore innovative approaches, like integrating cutting-edge technology and sustainable practices that not only save money but also improve brand reputation.
Enhanced vendor relationships: These aren’t your everyday vendor interactions; they’re strategic partnerships that enhance product quality, ensure reliability, and could even lead to joint ventures or innovation labs.

In the end, neglecting the evolution of the vendor management role is akin to steering a ship with an outdated map; it might get you moving, but you’ll likely end up off course. In today’s fast-paced, data-driven world, treating vendor management as a strategic pillar is not just a good idea—it’s an indispensable part of thriving in the modern marketplace. Businesses that recognize this shift and invest in empowering their vendor managers will not only navigate the market complexities more effectively but will also pave the way for a future where they’re not just participants but leaders. So, the real question is, is your organization ready to step up and embrace the strategic potential of vendor management?

Get Ready For Vendor Management Appreciation 2024

Will you be partying with us for Vendor Management Appreciation Day (VMAD) 2024? We highly encourage you to join us!

Why? Because there’s no expiration date on honoring one of the most important, under-recognized roles across industries: vendor management.

Join us in observing Vendor Management Appreciation Day (VMAD)! We’re gearing up for the 2024 celebration, and we want you to be a part of it!

VMAD is a new holiday geared toward unifying vendor management professionals and celebrating innovation in the field.

Moreover, we’ve released gifts each month to help you supercharge your vendor management efforts. Additionally, we’re planning some awesome events so everyone can connect and celebrate the important, strategic role of vendor management.

In the meantime, learn more here, and grab some free vendor management goodies.