From tactical to strategic: Retooling your supplier enablement strategy

Improve Supplier relationships and maximize Spend and Compliance savings

Make no mistake about it: in today’s modern business environment, it isn’t just recommended that you maintain electronic connections with your suppliers — it has officially become a requirement. Regardless of the type of business you’re running or the industry that you operate in, supply bases are large and diverse to say the least. This requires a supplier engagement strategy that includes electronic enablement, ensuring you maintain complete control and visibility as your business scales.


Despite all this, it’s important to not fall into the trap of outsourcing your strategy just on a matter of principle. Even though the tactics themselves dictating the strategy may be outsourced, the strategy itself needs to be of your own creation. As a buyer, you need to be exceedingly careful to not fall into the trap of ceding your supplier engagement strategy to a third party supplier network.

Taking control of your supplier network strategy first and foremost requires you to select the right approaches and services that allow you to go above and beyond the transactions themselves and focus on the ever-important qualities that your business depends on including collaboration, planning, analytics, intelligence and more.

The Benefits of YOUR Supplier Network

Perhaps the biggest benefit that this approach brings to the table is enabling better Procure-to-Pay (P2P) processes or extending the value of your existing systems, helping you to quickly connect and collaborate with suppliers from behind your four walls with all purchase orders across multiple systems. Your supplier network can do this by addressing all of the core P2P requirements, including but not limited to things like supplier enablement, catalog and content management, invoice automation and connectivity, and more. This in turn enables working capital related opportunities, which itself creates a mutually beneficial situation for everyone involved.

You’re Ready to Begin

At the beginning of this process, one of the most important things you can do is fully take control of your supplier network strategy BEFORE looking at any vendors. Separate your needs intelligently based on the direction that you want your business to head in. It is important to detail your objectives and pain points – be they reducing spend by maximizing use of electronic channels or supplier self-service to reduce AP queries.

It is also important to assess the profile, capabilities and readiness of your supplier base. Suppliers will typically engage faster if they don’t have to pay a transaction tax to do business with you and sign a contract with a third party Network. Recent research by the Hackett Group identifies this as the biggest barrier to success in supplier enablement. Further, suppliers will adopt faster if they have the choice to use their existing electronic method of doing business, including the formats of EDI or cXML they are used to. Clear communication with Suppliers about why electronic enablement is a win for you and them is key to getting their support. It’s important to help your suppliers help you, by providing them with the right capability surveys, welcome package, details on your electronic communication methodologies etc.

For the best results, you’ll need to explore your immediate needs for a network model and go over potential choices of apps, networks, platforms, etc. You’ll need to evaluate the various options in the market and decide which ones will maximize your potential for success. For example, some third party networks aim to tax suppliers with transaction fees and contracts, scale charges based on the amount of spend managed through their P2P platform, and force buyers and suppliers to use the least common set of features with limited configuration and flexibility to meet your needs.

Assessing the considerations above and planning your choices and outcomes will help you set a foundation for success.

Ivalua’s Supplier Enablement Philosophy

At Ivalua, we believe in a clear-cut, no-nonsense approach to supplier enablement and engaging suppliers with your supplier network. We make it possible for you to target 100% of suppliers from day one — be they small or large, local or global. There are also zero supplier transaction fees — suppliers do not have to sign a contract with Ivalua and the supplier relationship is owned by the buyer and not a third party network. This power of zero fees really works in your favor when combined with the fact that you and your suppliers can process an infinite number of transactions through the Ivalua platform. Unlike other providers, Ivalua does not charge buyers for processing more spend through the eprocurement toolset.

Suppliers are given a choice of no less than six entry points – direct integration, invoice data capture, email, invoice folders, manual entry and a state-of-the-art portal. We also believe in giving buyers choices on an engagement model — be it Ivalua managed, buyer managed with Ivalua assistance or something in between.

All of this is done with a clear goal in mind: to create an open network and offer you the type of global compliance that you and your suppliers can depend on. This is the type of environment where success isn’t just a possibility — it is inevitable.

Benefits to You and Your Suppliers

Using the right supplier enablement approach will benefit you in numerous ways, from spend and compliance savings to better supplier relationships. Likewise, your suppliers will benefit from timely payment, increased catalog spend, buyer stickiness, constant payment visibility and less need to manually follow-up on payment status.

Since its founding in 2000, Ivalua has successfully implemented more than 200 customers, 500,000 daily active users and millions of suppliers in more than 70 countries. Ivalua’s customers report better, faster, more informed decisions that enhance business value, increase savings, mitigate risk and improve operations.

Paul Noël, SVP Procurement Solutions, Ivalua
Paul holds a Management Degree from Santa Clara University in California and studied international business at Sofia University in Tokyo. His entire career has been about improving Corporate profitability through efficient operations and Management of Spend. From his work at Ariba, Softface, and Blackhog, Paul’s specialty has been to harness standard software and services to create specific solutions for companies large and small, local and international. Continuing this at Ivalua, Paul manages all customer-facing operations for the Americas.

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