Modern business is a complex web of interwoven relationships. As I work with organizations across a variety of industries, I’m amazed at the networks of suppliers, consultants and partners that companies bring together to create competitive products and services. While these partnerships deliver tremendous value, they also bring new risks. In fact, the Ponemon Institute recently estimated that data breaches are roughly 9 percent more expensive when third parties are involved. The bottom line is that you can outsource various business functions, but you can’t outsource risk.
Let’s take a look at three things organizations can do to better manage the hundreds of vendors that compromise their supply chains. This is the core of building a robust vendor performance and risk management program.