Best Practices for Maintaining an Approved Vendor List
Selecting the ideal candidate for your next project doesn’t have to be overwhelming. Similar to other facets of third-party risk management, proper organization and maintenance of vendor information creates streamlined visibility and liability mitigation throughout your various projects.
Whether selecting applicants for an upcoming job or monitoring progress of current hires, it is essential businesses optimize and update third-party information via vendor lists, compilations of relevant, centralized, third-party information for convenient access and reference.
By diligently collecting, organizing, and managing vendor list information, companies can become empowered to maintain full visibility and stave off non-compliance liabilities.
We recommend the following best practices when curating your lists:
Vendor List Best Practices
Determine Active Vendors
Begin your list-making process by compiling all known tenant information, including basic personal and company details, services offered, and expenditures. A complete archive of current and past data grants you the full scope of your business relationships.
Analyze Documentation Database
Companies should also review active third-party contracts, certificates of insurance (COIs), and other pertinent documentation to gauge overall project progress and any non-compliance. Diligent document tracking affords valuable insights into liabilities, expenditures, the quality of third-party services, and more—all essential in minimizing risk and potentially revealing which third parties could be repeat-hires, if a need arises.
While some companies manually track COIs and other documents, automated third-party management software negates the redundancy of certain filing tasks, saving organizations ample time and money.
Monitor Accounts Payable Balances
By reviewing any outstanding supplier or third-party balances, or accounts payable, organizations can not only reduce liabilities associated with missed or delayed payments, but also forecast budgetary estimates for future projects.
Conduct Stakeholder Assessments
Companies should then send compiled lists to all relevant stakeholders for a thorough assessment, enabling affiliates to confirm vendor involvement and contract(s), rate overall performance quality, and score third parties via the following criticality ranking system, reads an analysis from automated accounts payable software company Planergy.
Such tiers include:
- Critical: This vendor’s goods and services are pertinent to business operations and would result in casualty or detriment if removed, or the third party possesses sensitive customer information, posing a risk if breached.
- Important: The absence of this vendor’s services would significantly disrupt, but not entirely destabilize, business operations, or the third party has access to only some sensitive customer data.
- Useful: There would be only minimal disruptions without this vendor, or they do not have access to any sensitive customer information.
Remove or Edit Vendors as Needed
Stakeholder assessment responses legitimize vendor performance, and businesses can utilize this feedback to determine which contacts to edit, add, or omit from the list. By routinely conducting these five best practices, you can ensure your lists remain optimized, accurate, and up to date.
In diligently maintaining a vetted contact database for ongoing and future projects and organizing it for streamlined reference, you can repeatedly select ideal candidates, build safer third-party relationships, and curb potential non-compliance.
Leveraging Efficiency Through Automated Tracking
When mitigating risk in the vendor list approval process, the efficiencies of cutting-edge automated software can be a welcome alternative to heaps of spreadsheets or hours spent poring over COIs.
Investing in an all-in-one, centralized hub to broadcast automated requests for proposal (RFPs), chat with prospects, easily onboard, and track documents saves you valuable time and money by negating redundancies and highlighting document deficiencies.
Modernized solutions offering these capabilities and more, such as the Business Credentialing Services (bcs) platform, empowers organizations, not only in optimizing vendor lists, but in streamlining hiring, mitigating liabilities, and building safe third-party connections—altogether, protecting peace of mind so you can get back to running your business.
bcs is one of the leading third-party management solutions on the market, offering full- and self-service COI tracking, automated RFP broadcasting, streamlined onboarding through the bcs app, and more, and optimizing your vendor list approval and risk management processes. Try the demo or contact us today.
Learn from the pros about risk-mitigation, document tracking, and more, with expert articles from bcs.