Workday Vendor Management: VNDLY VMS Features Explained

Managing external vendors and contingent labor has become a critical operational challenge for organizations across industries, including healthcare. Workday vendor management, powered by the VNDLY Vendor Management System, offers enterprises a unified approach to sourcing, tracking, and analyzing their external workforce. For healthcare organizations already juggling complex logistics with transportation providers, home health agencies, and DME suppliers, understanding how major platforms handle vendor coordination provides valuable perspective.

VNDLY, acquired by Workday in 2021, brings specialized capabilities for managing contingent workers, staffing agencies, and service providers through a single cloud-based platform. The system addresses common pain points: scattered vendor data, inconsistent compliance tracking, and limited visibility into external labor costs. Whether you're evaluating VNDLY for your contingent workforce needs or exploring how vendor management principles apply to healthcare logistics, this guide breaks down the core features and functionality.

At VectorCare, we understand the complexity of managing external service networks, our Trust platform helps healthcare providers build and maintain compliant vendor relationships for patient transportation and care services. This article examines how Workday's approach to vendor management works, what VNDLY offers, and how these concepts translate across industries that depend on coordinated external providers.

What Workday vendor management covers

Workday vendor management through VNDLY focuses on three primary areas: contingent workers, staffing agencies, and service providers. The platform gives you centralized control over external labor that doesn't appear on your permanent payroll. You manage everyone from temporary office staff and contractors to specialized consultants and freelancers through one system that connects directly to Workday's core HCM platform.

Contingent workforce categories

VNDLY tracks individual contractors who work directly with your organization and agency-supplied workers who come through staffing firms. You see both W-2 contractors (managed through agencies) and 1099 independent contractors in the same interface. The system categorizes workers by skill sets, departments, and project assignments, which helps you understand exactly who's working where at any given time. Your finance team gains visibility into labor costs across different engagement types without manually consolidating spreadsheets from multiple vendors.

VNDLY processes over $100 billion in contingent workforce spending annually, giving you proven infrastructure for high-volume operations.

Extended enterprise services

Beyond individual workers, the platform manages statement of work (SOW) engagements where vendors deliver complete projects rather than hourly labor. You track consulting firms, professional services providers, and outsourced business functions alongside your contingent workforce. This unified approach means your procurement team and HR department work from the same data source rather than maintaining separate vendor lists. Organizations using VNDLY typically manage hundreds or thousands of vendor relationships through standardized workflows that enforce consistent compliance checks, performance metrics, and payment terms across your entire external workforce ecosystem.

Why teams use VNDLY in Workday

Organizations adopt workday vendor management through VNDLY because it eliminates the fragmentation that comes with managing external labor through separate systems and spreadsheets. You gain a single platform where your HR team, procurement department, and finance group all access the same real-time data about contingent workers and vendors. The native integration with Workday HCM means your contingent workforce data flows directly into the same reporting and analytics tools you already use for permanent employees, giving you complete visibility into your total workforce spending.

Native integration advantages

VNDLY sits inside your Workday environment rather than operating as a standalone tool that requires separate logins and data transfers. Your team members access vendor management functions through familiar Workday interfaces, which reduces training time and adoption friction. The platform automatically pulls organizational structures, cost centers, and approval hierarchies from your Workday configuration, so you don't rebuild the same business rules in multiple places.

Organizations using VNDLY report reducing their vendor management administrative time by up to 40% through automated workflows and consolidated data.

Compliance and cost control

VNDLY enforces standardized compliance checks across every vendor relationship, from background screenings to insurance verification. You set your requirements once, and the system prevents any vendor or worker from starting assignments until they meet your criteria. The platform also gives you real-time cost tracking at the department, project, and worker level, helping you identify spending patterns and negotiate better rates with your most-used staffing agencies.

How VNDLY VMS works end to end

The VNDLY workflow moves through distinct stages from the moment you identify a need for external labor to the final payment processing. You start with requisition creation in your Workday environment, where hiring managers specify job requirements, budget codes, and skill needs. The system routes requests through your pre-configured approval chain, checking budget availability and ensuring the request meets your organization's contingent workforce policies before moving forward.

Request to payment workflow

Your procurement team receives approved requisitions and either sources candidates from existing vendors or opens the position to your vetted supplier network. VNDLY displays available workers who match your criteria, complete with rates, availability, and compliance status. Once you select a candidate, the system automatically generates contracts, collects required documentation, and tracks time or project milestones. The platform converts approved timesheets or deliverables into invoices that flow directly to your Workday Financial Management system for payment processing.

Organizations using integrated vendor management platforms typically reduce their time-to-hire for contingent workers by 30-50% compared to manual processes.

Vendor selection and onboarding

VNDLY maintains your approved vendor list with current compliance documentation, insurance certificates, and performance ratings. When you need specialized skills, you search your vendor network by capability, location, and past performance metrics rather than starting from scratch each time. New vendors complete onboarding requirements before they can submit candidates, ensuring every relationship starts with verified credentials and signed agreements.

Core VNDLY VMS features to know

Workday vendor management delivers specific capabilities that address the daily challenges of coordinating external labor. You access tools designed for high-volume contingent workforce operations rather than basic vendor tracking. The platform focuses on features that reduce manual work while giving you tighter control over costs, compliance, and supplier performance across your entire external workforce.

Talent pool management

VNDLY maintains searchable talent pools where you store information about workers who previously completed assignments or applied for positions. You filter candidates by skills, certifications, availability, and past performance ratings, which speeds up your sourcing process when similar needs arise. Your team can invite specific workers directly from these pools rather than starting new vendor searches, reducing your time to fill by reconnecting with proven talent.

Organizations with active talent pools fill contingent positions 60% faster than those sourcing candidates from scratch each time.

Rate and performance tracking

The system captures rate cards from all your staffing suppliers and flags when quoted rates exceed your negotiated agreements. You track supplier performance through automated metrics that measure fill rates, time to submit candidates, and worker retention. These insights help you make informed decisions about which vendors earn more of your business and where you need to renegotiate terms or expand your supplier network.

Integrations, security, and compliance basics

Workday vendor management through VNDLY operates within your organization's existing security framework and compliance requirements. The platform inherits access controls, user permissions, and audit trails from your core Workday environment, which means your IT team maintains consistent security policies across all workforce data. You manage contingent workers under the same data protection standards that govern your permanent employees, eliminating the risk of separate systems creating security gaps.

System integration capabilities

VNDLY connects directly to Workday Financial Management for invoice processing and Workday HCM for organizational structures. The native integration moves data between systems without requiring custom APIs or middleware that introduce maintenance overhead. Your finance team sees contingent labor costs in the same reporting dashboards they use for payroll expenses, while your HR team accesses worker data through familiar Workday interfaces rather than switching between platforms.

Security and compliance controls

The platform enforces role-based access that limits what different users can view or modify based on their job functions. You configure compliance checkpoints that prevent vendors or workers from starting assignments until they complete background checks, upload insurance certificates, or sign required agreements. VNDLY maintains audit logs that track every data change, approval decision, and document upload for regulatory reviews or internal investigations.

Organizations using integrated compliance tracking reduce their vendor risk incidents by 35% compared to manual verification processes.

Next steps

Understanding workday vendor management through VNDLY gives you perspective on how enterprise platforms approach external workforce coordination. You've seen how centralized systems handle requisitions, compliance tracking, rate management, and payment processing for contingent workers and vendors. The principles apply across industries that depend on external service networks, from staffing agencies to specialized providers.

Healthcare organizations face similar challenges coordinating external vendors for patient services. You manage transportation providers, home health agencies, and DME suppliers who need consistent onboarding, compliance verification, and performance tracking. VectorCare's Trust platform helps you build and maintain these vendor relationships with tools designed specifically for healthcare logistics coordination. The platform handles credentialing, policy enforcement, and real-time communication across your entire provider network.

If your organization struggles with scattered vendor data, inconsistent compliance checks, or limited visibility into external service costs, evaluate platforms that centralize these functions. The time you save on administrative tasks translates directly into better patient care coordination and lower operational costs across your logistics operations.