What is vendor management?
Vendor management is the multi-stage process of initiating and developing relationships with providers of goods and services that a purchasing company (“the buyer”) needs for day-to-day operations and the fulfillment of its mission. From the buyer’s perspective, primary stages of vendor relationship management include:
- Vendor selection: Using an up-to-date risk profile and qualifying and segmenting based on category, location, and business unit
- Risk assessment: Performing risk due diligence based on the nature of your vendor engagement
- Contract negotiation: Establishing terms and risk KPIs
- Onboarding: With understanding of risk assessment and audit status
- Managing performance and monitoring/mitigating risk: Utilizing a matrix-based, single view of vendor and a data-driven incident model

Digitize and automate vendor management
Vendor management best practices call for implementing cloud-based vendor management software, integrated with procurement processes. The best vendor management software can:
Equip vendors to manage company information themselves with simple tools that keep your vendor master data current
Reduce cycle time by automating the supplier onboarding and qualification process and integrating it with other procurement processes.
Enable a vendor management framework that drives spend to preferred vendors
Syndicate real-time information for better vendor risk management through fast, informed decisions that prevent supply disruption
Instill confidence that selected vendors can deliver high-quality goods and services on a sustained basis
SAP Ariba Solutions for Vendor Management

Supplier Management
With SAP Ariba solutions, SAP provides the only end-to-end software portfolio that lets you manage supplier information, lifecycle, performance, and risk all in one place.
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Supplier Lifecycle Management
The SAP Ariba supplier lifecycle management solution is integrated with procurement processes to help you drive spend to preferred suppliers and scale compliance for your entire supply base.
More about supplier lifecycle management
Supplier Risk Management
Make risk assessment and due diligence part of the source-to-pay process, and tailor risk views and alerts to your business, to each supplier relationship, and to your role.
Manage supplier risk