Importance Of Vendor Management

Importance of Vendor Management
Many healthcare organizations rely on vendors for processing and maintaining data, performing operational, analytical and support services for day-to-day business and clinical procedures. Effective vendor management can not only save time, money and resources up front but also prevent the organization from future liability. Vendor management include areas such as communication, contract management and vendor risk management. HIPAA, Privacy Act and other major healthcare laws put emphasis on security of healthcare data and information. A major or minor breach can cause an organization to face legal liability that can lead to loss of goodwill (Healthcare Information and Management Systems Society, 2015). The

Project management knowledge areas include project integration management, project scope management, project time management, project cost management, project quality management, project HR management, project communications management, project risk management, project procurement management (Galndon et al., p. 321). Among them, project communications management, project risk management and project time management are critical for effective vendor management. Technology, laws and regulations are constantly evolving in healthcare industry. It is important to maintain long-term communications with vendors. The project manager or the project management team serves as a liaison between the stakeholders, end users and system developers/vendors. Project manager should inform the vendors about the specific needs are requirements of the stakeholders in order to set realistic expectations. These expectations can be included in the vendor contract. It is critical for the project manager to monitor and report vendor performance along the progress of the project. This can helps the vendor contract

According to Galdon, Solvensky, Smaltz (2014), a PMO is a centralized organization dedicated to improving the practice and outcomes of projects via holistic management of all projects (p. 315) . Among the various functions of a PMO; issuing regular communications to project stakeholders and the rest of the organization regarding progress or status of the projects and providing authoritative management and oversight of all projects, parallel with the similar functions of a VMO (Galndon et al., p. 328). Both PMO and VMO plays an important role in decision-making and creating excellent outcomes for their organization. They serve as a liaison between the stakeholders and rest of the organization to ensure the outcomes of the project match up to the needs of the users and the stakeholders. PMO and VMO also supervises and monitors day-to-day activities of the vendors and team members who are in charge of the project. Therefore, one can conclude that the functions of PMO and VMO are centered around important decision-making and oversight of the project to create an excellent outcomes for their