Vendor onboarding is a key business process that involves collecting and processing large data volumes from one or multiple vendors. Business users need vendor information in a standardized format to use it for subsequent data processes. However, consolidating and standardizing data for each new vendor requires IT teams to write code for custom integration flows, which can be a time-consuming and challenging task.
In this blog post, we will talk about automated vendor onboarding and how it is far more efficient and quicker than manually updating integration flows.
Problems with Manual Integration for Vendor Onboarding
During the onboarding process, vendor data needs to be extracted, validated, standardized, transformed, and loaded into the target system for further processing. An integration task like this involves coding, updating, and debugging manual ETL pipelines that can take days and even weeks on end.
Every time a vendor comes on board, this process is repeated and executed to load the information for that vendor into the unified business system. Not just this, but because vendor data is often received from disparate sources in a variety of formats (CSV, Text, Excel), these ETL pipelines frequently break and require manual fixes.
All this effort is not suitable, particularly for large-scale businesses that onboard hundreds of vendors each month. Luckily, there is a faster alternative available that involves no code-writing.
Automated Data Integration
The manual onboarding process can be automated using purpose-built data integration tools.
To help you better understand the advantages, here is a step-by-step guide on how automated data integration for vendor onboarding works:
- Vendor data is retrieved from heterogeneous sources such as databases, FTP servers, and web APIs through built-in connectors available in the solution.
- The data from each file is validated by passing it through a set of predefined quality rules – this step helps in eliminating records with missing, duplicate, or incorrect data.
- Transformations are applied to convert input data into the desired output format or screen vendors based on business criteria. For example, if the vendor data is stored in Excel sheets and the business uses SQL Server for data storage, then the data has to be mapped to the relevant fields in the SQL Server database, which is the destination.
- The standardized, validated data is then loaded into a unified enterprise database that you can use as the source of information for business processes. In some cases, this can be a staging database where you can perform further filtering and aggregation to build a consolidated vendor database.
- This entire ETL pipeline (Step 1 through Step 4) can then be automated through event-based or time-based triggers in a workflow. For instance, you may want to run the pipeline once every day, or once a new file/data point is available in your FTP server.
Why Build a Consolidated Database for Vendors?
Once the ETL pipeline runs, you will end up with a consolidated database with complete vendor information. The main benefit of having a unified database is that it would have filtered information regarding vendors.
Most businesses have a strict process for screening vendors that follows a set of predefined rules. For example, you may want to reject vendors that have a poor credit history automatically. With manual data integration, you would need to perform this filtering by writing code. Automated data integration allows you to apply pre-built filters directly within your ETL pipeline to flag or remove vendors with a credit score lower than the specified threshold.
This is just one example; you can perform a wide range of tasks at this level in your ETL pipeline including vendor scoring (calculated based on multiple fields in your data), filtering (based on rules applied to your data), and data aggregation (to add measures to your data) to build a robust vendor database for decision-making and subsequent processes.
Automated vendor onboarding offers cost-and-time benefits to your organization. Making use of enterprise-grade data integration tools ensures a seamless business-to-vendor data exchange without the need for reworking and upgrading your ETL pipelines.