Procurement and finance leaders across the healthcare continuum of care today recognize the benefits of procure-to-pay automated solutions. Measurable cost savings and smarter use of staff time are the primary and most talked-about gains organizations see when they are freeing themselves from inefficient, inaccurate, and cumbersome paper-based workflows and processes. This is especially true with today’s pressures from inflation and supply chain disruptions.
Another advantage emerges for healthcare organizations of all sizes when adopting procure-to-pay automation: the promotion and nurturing of better relationships with vendors and suppliers. These relationships and partnerships are a crucial aspect of healthcare’s lifeblood—efficient and cost-effective procurement and inventory management—and w
hen they’re frayed, hospitals, care centers, senior care, and post-acute care all suffer.
A report by Censinet and the Ponemon Institute examined how vendor and supplier relationships impact risk management in the healthcare industry. Regarding large organizations, the study found that healthcare providers average more than 1300 vendors under contract but only 27% said that they review these relationships annually. The report estimates that vendor risk management costs the healthcare industry nearly $24 billion per year.
These numbers tell an important story for healthcare leaders. An absence of accountable and transparent vendor relationships leads to unnecessary costs and a negative impact on the profitability of healthcare enterprises.
Better vendor relationships begin with a shift in point of view that includes:
- Mutual Learning. Inflationary pressures and supply chain strains mean challenges all around. When possible, learn about your major vendors’ business, along with their pain points, and how they’re meeting them.
- Ongoing Consulting. Just like you, your vendors are experts in their field. Let them tell you about new products and services that might make your work easier or more cost-efficient.
- Clear Communication. Set clear boundaries and expectations in these important relationships. Put key performance indicators (KPIs) in writing and track contract compliance to avoid over-billing and duplicative ordering.
The benefits of better vendor and supplier relationships begin with financial advantages, and can also contribute to stronger operations, time savings, and greater workplace satisfaction. All of these are accentuated and amplified by the efficiencies and time and cost savings that come with software automation in the procure-to-pay process.
These relationships are a two-way street. When you automate your procurement, spend management, inventory management, and accounts payable, you also benefit your vendors. Vendor and supplier integration with automated solutions such as Procurement Partners vastly strengthens contract compliance, streamlines workflows and processes, and promotes prompt payments and visibility into invoice status.
The mutual benefits of automated procure-to-pay solutions between healthcare organizations and their vendors and suppliers include:
- Eliminating Obstacles. With an automated procure-to-pay solution, procurement is made simple through an easy-to-use interface. Catalogues are at your fingertips, and the need to go to vendor websites is no longer an obstacle.
- A Single Unified Platform. Procure-to-pay automation means that all your procurement business functions are unified and in one place. Ordering, spend, inventory, and invoices are centralized and visible with total clarity and accountability. This means no more conversations based on partial knowledge, hunches, or anecdotes.
- Easy Vendor Onboarding. Healthcare procurement is highly complex and multi-faceted, for vendors as well as their customers. The best solutions, such as Procurement Partners, prioritize onboarding vendors to keep relationships as smooth and transparent as possible.
- Efficient Accounts Payable. Quick and accurate payments through procure-to-pay automation keeps vendors and suppliers’ business offices happy, without the hassle of running down invoices or tracking late payments or grace periods.
- Contract Compliance. With compliance of 95%, mutual accountability and responsibility means relationships are on solid ground.
Procure-to-pay automation for healthcare organizations was once a best practice. With the pressures of inflation and supply chain disruption today, it’s one of the most important tools for leaders to impact their bottom line.
Looking to Reduce Your Annual Spend?
Procurement Partners helps customers reduce their annual spend by more than 10% with an easy-to-navigate procure-to-pay solution where users can place orders and process invoices for all suppliers. Procurement Partners is the leading procure-to-pay management system for post-acute, non-acute, and continuum of care providers and has helped organizations achieve 40% time savings and 95% supplier contract compliance through automating the procure-to-pay process.