Supplier Data Enrichment
As part of all supplier management processes, third-party information is required to create a complete a profile of, or ensure compliance on, a supplier. The use of third party data thus complements data being generated internally on suppliers such as supplier performance and transaction data, while providing deeper insights for sourcing and procurement through the ability to better monitor supplier behavior and reduce associated risks.
Based on the Aberdeen Group’s August 2012 report, Supplier Lifecycle Management: Measuring Performance While Mitigating Risk, 43% of survey respondents indicated incomplete information regarding corporate supplier relationships is a top pressure affecting supplier management. In fact, Best-in-Class organizations are also 24% more likely (72% v. 58%) than under-performing firms to use company profiles to augment information on their suppliers
The following are samples of areas of enrichment
Bank Indentifier Codes
One best practice is validating both banking institution and bank account information. To prevent the high risk of payment fraud when dealing with unknown or uninsured institutions, organizations can leverage the standard known as a Bank Identifier Code (BIC), provided for all financial institutions participating in SWIFT. Doing BIC number validations also helps organizations confirm beneficiary (supplier) banks designated to receive funds being transferred.
Furthermore, as part of the Single Euro Payment Area (SEPA) initiative, if payments are being made to the EU or wider European Economic Area (EEA), validations can be made based on an International Bank Account Number (IBAN), a number that provides details on country, branch, and account number on where a payment is being made.
For improving core understanding of bank identification, HICX helps you:
- Confirm supplier banking institution information through BIC validation
- Provide deeper insights on SEPA based suppliers using IBAN validation
- Reduce and prevent the potential of payment fraud
OFAC & Debarment Compliance
While collecting supplier profile information on top tier suppliers helps organizations manage those suppliers they want to keep, what can be said for those they want to avoid?
In managing any supplier on-boarding process it is critical that organizations are well aware of the companies that are prohibited by the Office of Foreign Assets Control (OFAC). OFAC was designed to block assets and trade restrictions to accomplish U.S. foreign policy and national security goals. Any entity in the U.S. and foreign branches must comply with OFAC regulations.
With news abound on OFAC violations the costs of non-compliance are high which include civil penalties, criminal fines and prison time for corporate executives found to be guilty of willful violations.
Beyond the national security, other watch list / exclusion lists from federal agencies (e.g. General Services Administration, Department of Commerce and Department of Health & Human Services) to state level lists such as those focused on gaming commissions are essential in preventing issues with potential or existing suppliers.
HICX can help you manage OFAC compliance and address pertinent watch lists by:
- Providing updates on select suppliers for ensuring OFAC compliance
- Providing and validating against federal and state agency watch and black lists
- Reducing the risk of on-boarding registered companies or listed individuals
- Preventing costs due to non-compliance
Supplier Data Punchouts
Change is constant in the world of business. Perhaps this can best be illustrated by data from D&B that states –
- Every four hours a business ownership changes
- Every eight minutes a business files bankruptcy
- Every sixty seconds 58 business address will change
Obtaining third party data can assist in managing this constant change.
Third party supplier data can include a number of parameters such as address, parentage, corporate filings, executives, financial reports, product categories all affiliated with your supplier.
By aggregating this type of data through a “punch out” mechanism and bringing it back into one place within an enterprise supplier management platform, supplier managers are more prepared to build that up to date 360 degree view of their supplier base.
HICX can help you complete your supplier profiles by :
- Punching out to third party sites for data collection
- Collecting and storing other corporate supplier identifiers such as DUNS
- Enhancing address accuracy through USPS linkages
- Connecting parents companies with child affiliated suppliers
- Linking appropriate SIC, NAICS or UNSPSC codes with suppliers
Solution
HICX’s Supplier Data Enrichment services helps create a more complete supplier profile to:
- Allocate tiered supplier lists for HICX information alerts to verify data
- Augment supplier profiles with the latest published information
- Incorporate corporate linkages, standardized addresses, and commodity codes
- Integrate with relevant third party data systems
- Syndicate relevant data to downstream/upstream systems
Posted in
