Continuous Vendor Risk Management Requires Improvement
By: Danny Haydon, Chief Commercial Officer, Owlin Inc.
– In furthering my knowledge of the TPRM space, I recently came across a survey conducted by Venminder, indicating that over 40% of respondents had an established TPRM program but that improvements were still required. It’s hard to imagine a perfect Vendor risk management program, but including continuous monitoring and efficiency improvements certainly would get one closer to that idealistic state.
This blog includes several suggestions that could help improve your program.
Benefits of a Matured Vendor Risk Management Program
Firstly, let’s examine why maturity and technology advancement is essential for vendor risk programs. Here are three of the most important benefits:
1. Improved processes
Vendor risk management can appear overwhelming and complex. A more mature program ensures that the processes are focused, straightforward and consistent. Streamlined and efficient workflows save time and ensure high-quality deliverables.
2. Regulatory compliance
– If you’re one of those in a regulated industry, you’re probably already aware of the expectations regarding vendor risk management, including the need for the Board and Senior Management involvement. That being said, regulators expect to see more than just a cursory effort when it comes to managing vendor risk. Satisfying even the most critical of regulators
can be achieved with a proactive approach to program maturation.
3. Delivers on objectives
Every organization is different when it comes to vendor risk management. Each organization has its own business and strategic objectives. Some organizations may focus on efficiencies or cost reduction, while others require vendors to provide specialized products or services. With a mature and streamlined vendor risk management program, you can better deliver on your objectives. .
How to Improve Your Vendor Risk Management Program
Even if your vendor risk management program is already established, you may realize that you have been accepting “good enough.” What could you do to improve your program? Perhaps you could consider these suggestions:
- Invest in automation – Manual processes are prone to human error. Automating workflows and reporting using technological advancements can significantly contribute to the maturation of your program.
- Promote company-wide innovation – Most organizations can’t compete without innovation and don’t thrive without it. Additionally, you should apply this innovation to your vendor risk management program to evaluate new ideas and technological advancements you might be able to make.
- Outsourcing consideration – Certain vendor risk management activities can be effectively outsourced, resulting in reduced workloads, freeing up company resources, and potentially significant cost savings.
If you stop and think about all the great innovators and artisans throughout history, you will likely find that they adopted a continuous improvement mentality, rather than settling for an unexceptional “acceptable” or “good job.” In the same vein, a mature vendor risk management program will require continuous improvement to keep up with business changes, emerging risks and regulatory expectations. There are many tools out there that provide automation and constant monitoring that can make your life easier and remove the reliance on manual tasks. Isn’t it time you considered these workflow advancements?