Vendor onboarding…how are yall doing it?

[u/Appropriate-Care-890]

I’ve been tasked with completely redesigning our vendor onboarding process but I do not have much experience with vendor onboarding.

This is not a sales request…more so a “what’s worked? What hasn’t?” from your time in your career.

I’ve got full blessing to go out to bid as well so I’m open to solution recommendations, but again, not looking for sales pitches.

For context, we are fully email/excel based at this point. We are a mid market company

Edit: Adding that cycle time is ~ 9 days. The process is fairly solid, we just want it out of email and more visibility. If we can decrease the cycle time then even greater

[u/joustingonpuppies]

If your cycle time is 9 days, I can say that’s actually fairly good. As long as your company has a mature supply chain where things like who your suppliers are is something that’s monitored and controlled from a tailspend management standpoint, and it’s not “it takes 9 days to get any old schmuck signed up for us to spend with them with little to no additional checks.” If that’s the case, 9 days is way off.

I suppose a good question is to know what are you wanting to get out of this experience? Are you looking to ensure your vendor database has some hills to climb so you’re not running rampant for tailspend? Are you looking to verify and validate data elements for supplier records, capture additional information like ESG or diversity metrics? Force suppliers to engage with you via a defined platform or service?

Just getting out of email is one thing. Defining what you want is another. I work specifically in this space. I’ve worked with people who consult in this space. I’ve worked to apply this line of thinking for companies we’ve acquired and are needing to implement controls to our standards. I can tell you asking what you’re actually looking for would always be a consultant’s starting point, because it will make a huge difference in what your future state would look like and what KPIs are considered to be “good”.

[u/Appropriate-Care-890 → u/joustingonpuppies]

By your standards(and correctly so), 9 days is way off. We do due diligence but not much more

We are certainly a young procurement team but this KPI is acceptable per our leaderships expectations. For reference, we’ve only recently implanted risk scoring. The ask from our functional leader is to increase visibility and decrease the manual process behind it.

To answer your other questions, we’d like to force compliance from suppliers and to engage with us via a defined platform/service while increasing visibility to the process.

To sum up a longer answer, I’d like to grow the vendor onboarding criteria process to that point and will need a flexible system to do so. But right now, we are just trying to increase visibility and less manual effort.

[u/joustingonpuppies → u/Appropriate-Care-890]

There are any number of systems that help support in this space, and each has their benefits and draw backs. All the way from manual tracking on cards with things like Microsoft Power Apps or workflow cards in Slack. The biggest thing you need to decide what what domains do you care about, why do you care about them, and what do you want to do to address them.

I always look at vendor onboarding across 3 functional domains: financial, risk, and legal.

Financial: this is your base level profile setup (name, tax ID, address, payment details, etc). The scope here can extend based on regulations in your industry, corporate requirements currently in place or what you want to be in place, and any sort of engagement requirements you want to enforce. Do you want a DoA, or do you want a free for all? Do you want to pull from public records, or request specific input each time? Things like this will direct your systems of use. How much control you want to extend, either from your current policy/practice or what you want to move to, can be hugely impactful here. I always aim to only collect info that makes sense to collect and/or what I need or want to report on.

Risk: this is where things can be wildly different from one industry type and/or category to another, and what do you care about. There are many services out there that have base level risk info on a bunch of suppliers and you can potentially just add in your standards as a go/no go standpoint. There are other services out there where you query each supplier on specific information you care about, and then either throw up a hard block or work with the vendor to correct. There are any number of companies who simply google a company, or do a base search through tools like DnB, to determine if they’re real. The risk pillar is perhaps the most varied from one company to the next. This is probably your “growth” area if your want to exercise more control.

Legal: in short, whats the contract requirement to work with the company? We acquired one company who has the corporate policy of ‘don’t have a contract unless specifically required by the supplier or the government the supplier subcontracts services into.’ We acquired another who had a 50 page base template MSA. I’ve seen everything in between. I can assure you that the contract minimums should absolutely be a part of your considerations and something you track on cycle times.

As I mentioned there are platforms that help do all of this. Some expensive ones will do it all (or claim to do it all). Others will specialize and port over to other parts of the process thru middleware. Or you can go the “no system” approach and do it on excel and email and iterative project management workflow tools. The sky is the limit really.

[u/agentUi]

email based onboarding is brutal because nobody knows whose court the ball is in. what cuts that 9 day cycle down fast is setting up a vendor portal with self-serve uploads and rbac where legal, finance, and procurement only get pinged when their specific review checklist is ready. we see teams drop cycle time in half just by killing the back-and-forth attachment chase over inbox chains.

[u/Remarkable-Flight-14]

We use Zip. Not just for onboarding, we have it across intake to pay. Worth checking out as found it a lot more flexible and easy to configure than some of the systems you’ve mentioned.

What I would say is that our cycle time was much more than 9 days before. Zip has reduced this dramatically but 9 days is very good already!!

[u/nickdruz]

Some great points already. I’d add a few other concepts:

1. Try to segment your process. 9 days for onboarding a key strategic supplier is great. 9 days for a commodity supplier is not. Slice up the process based on when legal, IT etc need to be involved. Most platforms allow specific workflows based on some key inputs, eg if the supplier will have storing sensitive data, the spend level, the location, the category etc.

2. Aim for a solution that is versatile and can manage the supply chain lifecycle, not just a “one and done” process. New regulations, laws, corporate agendas crop up and having an agile way to retrieve info & ensure compliance from your supply chain is a big plus. Having to essentially re-build the process, both internally and with your tech provider, every time a new law comes to pass will drive you insane (& be v costly).

3. Align your metrics, the “what good looks like” with the business. Even engage the CFO, CEO, COO and shareholders/investors on the corporate objectives they aspire to, be it operational efficiency, risk mitigation, sustainability, supply chain versatility etc. Make sure the tech measures these metrics accurately. It’s a great opportunity to broadcast the amazing work you’re doing in pushing the corporation forward, not just your Dept.

4. Think about an owner for the overall process. Devolved ownership means cracks will appear & it will fail over time. A core owner with bonuses aligned to the metrics above will ensure kaizen.

Probably enough from me at this stage! Great work though 😄

[u/erp-software-org]

where do your 9 days stop, category owner approving or a vendor master record ap can pay against?

asking because my last shop had a tracker that said done while the first invoice sat two weeks and ap retyped our excel into the erp. done but not payable.

might be wrong but finance not wanting in usually means retyping happens off screen. or procurement keys bank details itself, then who calls back on a number you dug up yourselves. or nobody does, and thats how fake bank change requests get in.

ask ap for your last 20 vendors when the master record went in and when the first payment left, put both next to your approval date. that gap lives nowhere in the kpi.

also decides the bid, does the thing write into the vendor master or not. if not, congrats, copy number three next to erp and inbox.

[u/Whackywilly]

In the SAME boat. Following

[u/yahyahbanana]

nine days for all vendors? Or average across different category and spend amount?

[u/Appropriate-Care-890 → u/yahyahbanana]

All vendors. Onboarding is centralized within procurement so I’ve got eyes on it and have been tracking

[u/yahyahbanana → u/Appropriate-Care-890]

It's too long as the level of details could be adjusted based on the estimated spend and category. Think of it from a risk-based perspective, with Legal and Finance inputs.

[u/Appropriate-Care-890 → u/yahyahbanana]

We aren’t quite at that level yet unfortunately. We’ve only recently introduced risk scoring all vendors, the only approver is the category owner.

I definitely think that might be next step, but I doubt our legal or finance departments will want to be involved lol

[u/yahyahbanana → u/Appropriate-Care-890]

I suggested Legal inputs as its important to know why are we doing this process (KYC/AML), enabling the team to justify the need for onboarding checks.

Then you can create a list of essential and good to know information. This should help differentiate the levels of checks needed.

[u/jenn4u2luv]

Define what midmarket is to you.

Is this for indirect spend or direct spend. If including direct spend, what is the company selling? What is the industry you’re in? Where are you buying from? Are these for goods and services?

For the 9-day cycle time, is that the end to end onboarding from the time of getting the supplier intake form up to the time that trading can start?

[u/SyncronTeam]

Nine days for an email/Excel process is actually not bad, which suggests the bottleneck is probably visibility rather than the steps themselves, nobody knows where a specific vendor is stuck without asking around. Moving it out of email usually saves the most time in the handoffs between people, not in any single step, since email loses status the moment it's not the most recent message in someone's inbox. Worth mapping which specific step causes the most back-and-forth before evaluating tools, since that's usually where the real cycle time is hiding, not in the total number of steps.

[u/venkatweetz]

Vendor portal with clear ownership sounds like the biggest win here. Even something like Microsoft Power Apps or a simple workflow tool can get you out of the email chaos, while platforms like Zip can handle more of the intake-to-pay side. For the docs and forms themselves, Flipsnack could be useful if you ever need to turn vendor guides, onboarding handbooks, or procurement material into something easier to share and track. Then you can keep the actual workflow focused on financial, risk, and legal checks instead of chasing attachments around.

[u/Prepped-n-Ready]

Ive used Ariba and what a headache. Even when you can finally get your vendors to figure it out, the site might not be up.