Vendormate Introduces Contract Manager –Something Old Becomes Something New
Tags: contract management, rep credentialing, supplier credentialing, vendor credentialing, vendor information systems, vendormate
My veterinarian validates my credit card and requires my dog’s shots to be up to date before he will admit him for boarding. So, it seems reasonable that my local hospital would take similar steps. For example, from a patient’s perspective, it makes sense to me that my provider would make sure that its suppliers are financially solvent and that their respective representatives aren’t carrying a contagious disease or, for example, aren’t afflicted with an uncontrollable urge to unplug things that go beep. Fortunately, most of them do. This application market is known as “vendor credentialing” and it includes “rep credentialing.”
I recently ran across an angry online petition started by a fellow –an owner of a medical products distributor– who is obviously very unhappy about the lack of a universal standard for vendor credentialing. In fact, he represents a growing sentiment that says a “universal passport” of some kind should exist; that an all-powerful and universally accepted intelligent credential should be available to suppliers and their representatives so they can avoid the redundant administration, related compliance expenses and the registration costs associated with these systems.
- Bottom line: The belief is that current practice is too expensive, inefficient and creates an unfair playing field; that it’s already far too difficult and expensive for smaller companies to successfully compete, and that vendor credentialing compliance favors the big companies who can afford the related “hassles.”
File that thought under the heading “be careful of what you wish for.”
With some understanding of what it would take to develop, implement and enforce such a system, suppliers should happily pay the current tariff and recognize that competition between credentialing vendors and the lack of a universal template is actually keeping the credentialing price in check. At least for the immediate future, and notwithstanding the myriad of additional interested parties whose concerns are already accommodated in these systems (including private, state and federal concerns –more than enough for most tastes), the “universalists” will have to continue to tolerate providers who define their fiduciary responsibility and patient care responsibilities on their own terms.
The data indicates that 75% of the providers in the US have already implemented some kind of credentialing system. In fact, it’s probably fair to say that “credentialing” (in healthcare) is approaching what can be considered “essential infrastructure.” And that’s good news on several fronts. Among other things, it means that the dominant solution providers are working hard to differentiate and compete on the basis of providing solutions that are as close to the idea of a universal passport as is technologically practical (i.e. the experience of the last decade has led to widely acknowledged best practices) and by adding complementary applications that add capability and create new benefits for everyone who interacts with these systems. In other words, the best systems do more than manage a rep’s flu shot records; they should make it easier for everyone to focus on creating value, instead of chasing paper.
Case in point: When supply chain management professionals think about contract management, we typically think about systems that make sure we’re buying the right product at the right price. Contract “leakage” is the bane of our existence. Providers continue to invest in eMarketplace solutions for that very reason –to make sure product and price compliance is managed at the point of purchase. But what about all of the other elements of a contract that are typically stipulated (e.g. renewal terms, delivery, returns, insurance, financial reporting, rebates and other performance based conditional terms and potential benefits/penalties)? How is all of that being tracked and coordinated?
The best credentialing solutions have evolved to become “vendor information management systems” and for one of the market’s leading solution providers, Atlanta-based Vendormate, adding a product to cover this gap in the contract management solution space not only satisfied the voice of its customers, but it’s broadened the company’s market opportunity. As Chris Luoma, Vendormate’s VP of Business Development put it, “if we’re already managing all of the other information disclosed between the buyer and seller, why wouldn’t we help manage these other relationship defining aspects of the contract?”
And when you consider the increasingly collaborative nature of vendor/provider relationships, systems that allow managers to logically distribute the tracking and coordination responsibilities for these other contract elements (elements other than an image, SKU# and price) to the right parties –both internal and external– don’t just benefit the provider, they benefit all parties to the contract. Indeed, these systems ought to be the vendor representative’s best friend.
We know that the ancient tug of war between buyers and sellers is giving way to more enlightened ways of doing business. And how such increasingly collaborative relationships are managed isn’t going to be covered by an ad hoc “system” that is buried in the integration between eMarketplaces, ERP and the other transaction oriented fulfillment components of a P2P system. If we’re becoming increasingly “vested” in our business relationships, we need systems that engage, track and manage all of the other relationship elements.
We’ll be doing a deep dive into the Vendormate system, called “Contract Manager” and inviting the other solution providers to participate in our competitive evaluation as well. Stay tuned. This is good stuff.