Vendor Management Flashcards

In ERP systems, which module is primarily responsible for managing vendor master data?

Answer: Materials Management (MM)

The Materials Management (MM) module stores and maintains vendor master records including contact info, payment terms, and procurement data.

What is a Vendor Scorecard used for in ERP-based vendor management?

Answer: Evaluating vendor performance against defined KPIs

A Vendor Scorecard measures vendor performance using KPIs such as on-time delivery, quality, and pricing to support sourcing decisions.

Which process in ERP allows a company to pre-qualify suppliers before they can receive purchase orders?

Answer: Vendor Certification

Vendor Certification is the pre-qualification process where suppliers are evaluated and approved before being added to the approved vendor list.

In ERP procurement, what does a 'blanket purchase order' allow organizations to do?

Answer: Commit to purchasing a set quantity from a vendor over a period of time

A blanket purchase order establishes a long-term agreement to buy a specified quantity or value from a vendor over a defined period, reducing repetitive ordering.

What is the purpose of a Vendor Risk Assessment in ERP vendor management?

Answer: To identify and mitigate risks associated with supplier dependency and performance

Vendor Risk Assessment identifies financial, operational, and compliance risks posed by suppliers so organizations can take mitigating actions.

Which ERP feature helps enforce compliance by restricting purchases to approved vendors only?

Answer: Approved Vendor List (AVL)

The Approved Vendor List (AVL) restricts purchasing to pre-vetted suppliers, ensuring compliance with sourcing policies and quality standards.

In ERP systems, what is 'vendor master data' typically organized by?

Answer: Vendor account groups and purchasing organizations

Vendor master data is organized by vendor account groups (controlling data fields) and purchasing organizations (procurement-specific settings).