Vendor Risk Management: Why Your Company Should Care
As businesses continue to outsource their business functions to third-party vendors, vendor risk management is quickly becoming an important consideration for many medium- and large-sized businesses. According to Atlas Vault, companies now work with a variety of different vendors to “supply everything from machine parts to software applications.” Often, third-party vendors have close relationships with businesses and are given access to a company’s offices and computer networks. For this reason, businesses that routinely work with third-party vendors should have a vendor management system (VMS) in place.
Here are some of the reasons your business should care about vendor risk management:
Since you’ll be giving third-party vendors access to your business, they can be a risk to the security of your organization. OnCourse Learning, which empowers customers to enhance their workforces, urges companies to have a vendor risk management strategy in place. By doing so, this can mitigate these risks by determining if vendors have “a history of breaches, customer complaints or other problems.” Companies should also determine what areas of the business the vendor will have access to, and to put safeguards in place in order to mitigate those risks.
If you have a reliable VMS, you won’t have to spend time monitoring the performance of your vendors. Instead you can focus on your product. Adam Cahill, CEO and owner of SUPPLY POINTe, a transportation and shipping services company, recommends focusing on vendor management. When you do, you can rest assured that your vendors are doing their jobs correctly. This will allow you to focus on your product and on keeping your customers happy.
Managing vendors effectively improves efficiency and allows you to monitor “which tasks the vendors are supposed to perform during all phases of the vendor management life cycle,” says OnCourse Learning. By understanding exactly what tasks vendors are expected to accomplish, you can help to eliminate redundancies. Often, companies will hire multiple vendors to provide the same service to different departments, and vendor management will allow you to identify these redundancies. Having fewer outside vendors to manage can reduce risk of allowing unknown individuals onto the premises.
Protect Your Brand
If your company experiences a security breach because of vendor negligence, the integrity of your brand could be compromised. If customers receive poor service from a third-party vendor, they will likely blame your company. By focusing on a quality VMS, you can protect the quality of your brand.
SureID can help a medium- or large-sized business with identity assurance solutions geared towards vendors and contractors. SureID Certified™ Edge is a high-assurance identity solution that includes a background screen and ongoing monitoring. It enables organizations to have confidence in the identity and business legitimacy of third-party vendors, contractors and suppliers that come on site to provide various services. SureID products can integrated with your existing credentialing system. For more information, contact us.