Cleansing the Vendor Master....

One of the readers of blog Shekhar asks:

" What would be the factors to consider while doing the cleansing of the vendor master data?" 

Some of the factors to be consider are the following:

1. Vendor Volume

2. Vendor transaction volume

3. Vendor integration with different modules, for example in with Purchasing, with purchasing, payables, third party systems, projects etc...

4. Some complexity is generated when Vendor is also the customer in which case they have to be purged from the Receivables also.

5. Whether work will be done onsite or offshore. Offshore needs more tracking and control. 

This main activity involves the following sub activities.

1. Planning. This involves three aspects. Pre cleansing checks and validations, Cleansing, and post cleansing activities. Pre Cleansing activities will include who / how to identify obsolete vendors, how to handle partial open transactions in their accounts etc. Cleansing part involves preparation and testing of cleansing scripts. There are two major activities in Post Cleansing. One, validating that the cleansing has completed successfully and two, to put in place processes and procedures to manage Vendor life cycle going forward. 

2. Identification of Obsolete Vendors. If the vendor master is like any that I have experienced, there will be three main groups of obsolete vendors. One, Inactive Vendors who are still in the database, two, Vendors who are currently active but not having transacted for some time (may be years) and three, Duplicate Vendors who were created by multiple users. Each of these groups will have vendors with Open Balances. Vendor identification should be done by the customer. 

3. Transferring the pending balances to a dummy vendor or to a suspense account. Once this is done, ensure that there are no vendors with Open Balances.

4. Purging the vendors, vendor addresses, Vendor transactions etc. There may be some sequence in which this process has to be done, for example, ensure that transactions, addresses, sites are removed before removing the vendor header information.

5. Post purging validation based on the criteria decided in the Planning stage.

These are some of the points that I can think of. Do you have any other suggestions?