Why Using Supplier Data Effectively Will Spark Your Growth
When problems with your system arise, it’s all too tempting to blame the system itself, rather than considering other potential root causes.
Scenarios like this usually see companies trying to implement a replacement system and going through wholesale change, seeing it as something of a magic bullet. An easy win. However, the truth is that this is often a case of simply investing more, rather than investing smarter.
Much of this stems from the perception that ‘data’ is only an administrative tool, which leads to it being overlooked a lot of the time. This is where the problems start. The constant churn of different technical solutions means many companies end up with a mish-mash of systems.
Many of them still believe that the end goal is to establish a single system that will enable the use of perfectly integrated data. However, the problem with this approach is that it leaves a lot of businesses tied to one single provider and suffering from the same challenges.
What seems clear is that a different approach is needed for businesses who want to benefit from real change. This means switching focus from simply looking at IT solutions, to looking at your supplier data management strategy instead.
Supplier data quality comes first
The key to getting the most out of any system is ensuring that your supplier data is of the highest quality. The problem is that many companies struggle to achieve this because they get caught in a loop – data cleansing, followed by the inevitable erosion of its quality because of duplication, inconsistency or expiration. This creates the need for another data cleanse, and so the cycle begins again.
This process prevents businesses from getting the most value out of their supplier data, so clearly a change is required. Instead of the periodic cleanse, organisations need to establish a ‘single source of truth’ – a reliable and accurate home of supplier master data (SMD) that runs across different functions.
To put this in place, some holistic thinking is required. Decision makers need to think about the project’s objective in terms of what the desired business outcome is and who’s involved along the way.
The people who create the data are often different to those who actually use the data, which can lead to errors and oversight. This disconnect is something that must be overcome.
Why is supplier master data important?
At the heart of any supplier master data project is the aim to make sure that all stakeholders are using the same information and making informed, error-free decisions. The result of this is agility and flexibility across the organisation, whereby users aren’t locked into relying on one system.
An inherent part of implementing an SMD governance programme is allowing stakeholders to establish ownership over specific areas of data relevant to them, and allowing them to feel empowered enough to make their own decisions. Also, this process can’t be allowed to merely be a one-time, ‘flash in the pan’ type of thing. It must be sewn into the fabric of the company.
People need to know when issues need to be escalated, and supplier master data management cannot simply be labelled as an administrative function, but rather as an executive one. Changing the mindset of an organisation means making it clear that data now plays an integral role in all processes and must be seen as a key asset.
Given what’s been mentioned above, it’s also clear that supplier master data governance should not be seen as a one-time project to be instigated by the IT department alone. As we’ve already touched upon, this supplier data process relates to all data users and is likely to be something that also evolves over time thanks to its flexibility, as opposed to the rigid and inadequate systems which you’re trying to move away from.
User input is crucial for successful data governance
We hope you’ve found this article useful. If there’s one key message that you should take away from it, it’s that it’s not all just about the systems – the people are just as important. Data users – the ones who’ll be working with it on a daily basis – need to be part of the data creation and management process.
When supplier master data governance becomes ingrained in the business and is something that everyone is partly responsible for, it stops it from becoming a daunting project that people only touch when they absolutely have to, and instead turns it into a series of smaller, more regular tasks that can be managed more easily.
By creating a collectively-governed data process that allows you to input master data into any tool, you can leverage Best of Breed systems and create a better user experience – all without needing to sacrifice data quality and visibility.
We have plenty of resources that can help you to get the most value out of your supplier data – click here to access them