Beating Your Vendors Up Can Be A Sport – Does it Work? #APAutomation
You might remember many years ago that Wal-Mart went paperless. Wal-Mart has, at least in the media, the reputation of beating up their vendors. Well, when this paperless thing came around they told their vendors, that if they wanted to get paid they would have to go to a portal enter their information and submit that information in a particular form at a certain time. Now I don’t know if that’s considered beating up a vendor, but the Wal-Mart message was, if you don’t do this then we are going to find one of your competitors that will and you won’t do business with Wal-Mart again.
Not Everyone is a Wal-Mart
It’s true, we are not all Wal-Marts and nor do we want to be. I have to admit that in the beginning of my Accounts Payable Automation career I prescribed to this idea that if your vendors don’t comply to certain rules, then tell them they can’t have your business. As I look back on that, I was wrong (please don’t tell people I wrote that). If I am truly honest with myself, not only was I wrong but it was a very convenient way of excusing the shortcomings of the automation software I represented.
Does it Work?
My experience has been that it does work with some vendor and it doesn’t with others. Now, I know that’s a very convenient answer. However, the answer to the answer is that even though it works with some and not others, all of them over time get really tired of it. Sure, some comply and it becomes a new normal, but what I have found is that you put your company at risk with important suppliers or vendors, and the people doing the decision-making may be completely unaware of the importance of the relationship.
What to Do…
Instead of beating your vendors up to comply to Accounts Payable Automation, the thing that I have found that works better is giving them choices on sending in invoices. When you give them enough choices, it doesn’t have to be a lot, but a few their adoption is a lot higher. I have also found that with more choices, like email, outsourced scanning and a vendor portal (just as a few examples) it takes you out of the position to “sell” the automation idea to vendors. There is a direct link between the change you make your vendors do to adopt and how long and contentious your implementation process is.
I casually mentioned that I used to prescribe to the beating up vendors because I was hiding flaws in the software that I represented. This is something that you really have to vet out. If your service provider is coaching you to take the hardline, make sure it not for the reason I had years ago… software flaws.
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