If someone woke me up in my sleep and posed a question about what a VMS is for – pat would come the answer about it being a solution for Contract Workforce management, which is too vast a topic to be dealt with here. Once fully awake, I could start taking about some of the innovative uses of a VMS program. One such is that of managing RFP/RFQ using VMS.
According to research by Forrester, the use of the VMS for managing RFPs brings in additional capabilities to the process without adding to the cycle time and helps to provide insights into the best practices and templates for contracts as well as negotiations. VMS can become an essential tool for RFQ/RFP creation, negotiation of bids, followed by receiving them for evaluation, and stipulating a format for the price bids, which makes it easy for evaluation by the VMS itself.
The VMS helps to define the key measurement areas and the required outcomes of the project stipulated unambiguously. The VMS, with its centralized workflow and automated tracking systems can manage the deliverables on the project through continually monitoring it. It generates reports on the performance criteria with special attention to the bill rate, number/quality of resumes and time taken to complete the project. This process of tracking also helps to manage and resolve any issues that may come up during the project which need special/immediate intervention. Its use of instant electronic communication tools for the various tasks makes the whole process extremely efficient.
The VMS approaches the bid evaluation process in a scientific manner and by juxtaposing its knowledge of competitive market prices against the services provided helps to negotiate the prices, while linking them to performance metrics as well as regulatory, co-employment, Sarbanes Oxley compliance and creates the necessary audit trail on an ongoing basis, bringing great value to the whole process of performance management by providing insight into the project’s spend and performance and regulatory compliance.
Having determined the various components of the approved budget for the project, the VMS tracks and analyzes spend on an ongoing basis. It allows for assignment of time to multiple tasks and then enables an accurate accounting process for the project as well as an accounting process for the various divisions and/or departments involved in the project – implementing the spend authority limits of each of the users/approvers. It automates the end-to-end invoicing and tracks non-billable time. It configures timecard rules and supports application of different rates across locations. It has automated processes for achieving cost reductions through planning and implementing processes for volume and prompt pay discounts, establishing a competitive pay structure, error-free invoicing, adherence to budgets and lack of any scope for maverick spend.
Management, at any point in time, is in need of business intelligence not only to understand the standard of its performance in the current period but also to strategize and plan for improvement in the future. The VMS fulfills this requirement by providing access to the complete information bank spanning the crucial areas of vendor, compliance and financial performance. This data can be analyzed and interpreted using various graphic tools offering a visual dimension to the data to better understand the inferences offered. It can also provide the necessary tools for budgeting and forecasting future trends, utilizing its database for the analysis.
As most Vendor Management Systems today are customizable, it is important to understand the benefits this solution brings to the table, so as to make the most effective use of them.
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