Vendor Risk Management (VRM) is a method that deals with the planning and management of third-party suppliers who provide products and services. This process ensures that the enterprises must assess, monitor, and manage their risk, which does not result in a potential business disruption or any negative impact on business performance from third-party suppliers of IT services and products.
VRM is a tool that is necessary for the identification and mitigation of Business risks.
An Ideal VRM strategy should include the following:
[ * ] The contract that outlines the business relationships between the organization and the third-party products and services.
[ * ] Clear guidelines with respect to access and control of sensitive information as per vendor agreement.
[ * ] Unwavering monitoring of vendor's performance to ensure that each line of the contract is Intune & executed accordingly.
[ * ] The Vendors should meticulously follow the Industry Regulatory Compliance & there should a process to monitor the same.
How to Start a Vendor Risk Management Process:
Develop a policy, Process and Procedure:
A well-documented policy, with an overview of How VRM will be handled, defines the day-to-day activities & procedures to be followed by the stakeholders’ responsibilities, leading to the successful VRM.
A well-defined vendor selection process:
For an organization to have a successful vendor relationship, a well-defined Vendor selection process should be in place to act as a third-party supplier of IT products and services. The process may include
[ * ] Floating a Request for proposal from vendors (RFP)
[ * ] Proposal comparison between Vendors
[ * ] Analyzing the Risk assessment.
Finalizing the Contract in place:
Before signing the contract with the vendors, have clear communication to understand both parties' responsibilities. Underlining the Organization contract standards get the review & approval from the key stakeholders & the fully executed/signed contract plays a vital role in VRM.
(1) Periodic monitoring on Vendor's Service levels: Keep a strong process in place & continue to perform vendor due diligence on a regular, quarterly basis. It's important to know that any vendor changes that may impact the risk posed to your organization. Continue to assess the vendor’s SOC reports, business continuity, and disaster recovery plans and information security procedures.
Complete the annual assessments – risk assessments, performance assessments, information security assessments etc.
(2) Internal VRM Audit plan: Create an internal audit process plan to fix the errors & gaps in the process. This will help us to verify the organization controls in place to mitigate risks present.
(3) Have a robust and comprehensive Reporting Structure: Keep the reporting in a customizable manner that is ready to obtain & easily accessible to the management.
There are basic risks with every vendor, and much of what can go wrong that lies beyond the primary organization's control. To guarantee that your organization is not exposed to needless risks, compliance issues, or negative publicity, risk management needs to be a core part of vendor management.
If you are interested in VRM with ServiceNow, please feel free to reach out to our certified experts at info@rede-consulting.com or visit https://www.rede-consulting.com