IT vendor management is quickly evolving as a formal discipline because enterprises are demanding more from vendors in order to deliver the value and innovation they need to achieve positive results, according to Gartner Inc.

"Vendor management is increasingly important as a distinct discipline because newer cloud delivery models and niche vendors can generate a lot of value for a business, while also introducing a high degree of risk that requires management," Gayla Sullivan, research director at Gartner, said in a statement. "Moreover, the era of digital business brings many opportunities to generate competitive advantage and increased revenue through the innovative technologies and services offered by vendors."

Vendor management programs that focus only on cost reductions and service-level agreements will likely fail to capitalize on some of the best opportunities available through working with vendors, the firm says. Successful organizations will make sure their vendor management programs maximize opportunities as well as mitigate risks.

"The assertion that vendor management provides increased business value, controls and protection to organizations is well-supported,” Sullivan said. “In many highly regulated industries, vendor management is not optional and regulatory bodies are beginning to provide guidance, particularly in relation to vendor risk and performance management."

Processes that support the discipline are starting to take advantage of advanced techniques and tools, and are quickly becoming more streamlined and efficient.

Gartner has outlined the advances in vendor management across four dimensions, to provide a framework for assessing vendor management programs. The dimensions include governance, people and organizations, processes and tools, and analytics and trending.