Vendor Management System – Why companies need it?

In this age of technology advancement the Vendor Management System (VMS) has become one mighty weapon for most of the companies in the Staffing Domain. But unlike other renowned technologies which are all around us Vendor Management System is quite bound inside the company and among the people working on it.

I am trying to reveal a brief introduction about the term Vendor Management System so that readers won’t get surprised when this term will be coined in front of them and rather than having an initial ‘I am not sure about this’ hiccup they can carry on involving themselves in discussions on VMS.

If one consults Wikipedia it will define VMS as follows –

“A vendor management system (VMS) is an Internet-enabled, often Web-based application that acts as a mechanism for business to manage and procure staffing services – temporary, and, in some cases, permanent placement services – as well as outside contract or contingent labor.”

Ok you understand this one is a staffing software which helps an organization to grow with a correct and in-need sets of employees. But that is not the only reason companies want VMS. Let’s dive a little bit inside to find out why companies are searching for a correct VMS solution to fulfill their needs.

First lets see the Process areas for VMS and what is the desired effects it has on each of the processes and from a company perspective how they are getting benefitted by using the solutions.

Mainly there are three processes VMS works on:

  • Communication
  • Constraints &
  • Governance

Now lets have an eye on the following chart to understand how VMS solutions are helping the Staffing Companies:


VMS is a solution which every staffing companies should try to use to gain the advantage in this all-about-technology era. But the very problem they face is to find the correct vendor for the VMS solutions as the market has numbers of vendors providing their VMS products at present.

While rationalizing the vendor for farther partnerships one should remember one important point

  • Apply 80/20 rule – which means Keep top 20% vendors and Phase out the bottom 80%

This will help you in two aspects of the business i.e.

  • Less Vendors: Strategic Partnership
  • Reduced Administration: Better Oversight

Hope this blog will enlighten you in course of introducing yourself to the Vendor Management System and now you can contribute atleast something in discussions involving VMS rather than standing surprised!

Thanks a lot for passing by.

If you are in search of VMS consultation kindly contact –
or comment your queries here to get answered!

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s