The Business Problem

A well-reputed financial services provider in the United States, who was focusing on addressing customers’ needs and shape the future of finance, sought to implement a robust system that would be able to identify and manage vendor risks proactively. They were looking to ensure compliance with OCC Matters Requiring Attention (MRA), while gaining a granular view at the vendor level. The key objectives they were looking to achieve through this engagement were:

• Devise a vendor risk management framework to address in-efficient and rising costs occurring due to the addition of new vendors and services.
• Implement a multi-dimension approach to calculate risk and enforce an effective corporate policy.

Establishing a vendor risk management process is critical to ensure compliance and manage vendor risk. Request a free proposal and access our complete portfolio of vendor risk management solutions.

Solutions Offered and Client Journey

SpendEdge engaged with the client as a cross-functional team and established a performance monitoring function to monitor risks associated with each vendor. They identified vendors based on their level of inherent/residual risk and determined how critical they were to the firm. The vendor risk management process also helped the client to ensure compliance with all regulations and guidelines.

In a span of 45 days, SpendEdge provided a centralized repository that captured vendor profiles, services provided by vendors, assessments, and evidences. This enabled them to categorize vendors (Level 1, Level 2) and create configurable workflows for each assessment cycle.  Centralized issue tracking and action plan management allowed for the creation and management of various issues resulting from the assessments and the resulting action and remediation plans.

SpendEdge improved the vendor risk management process and communicated the client’s organizational policies and on-boarding documents to the vendors. In addition, the experts analyzed risk at service level to help executives pin-point the exact problem area and not just on the overall vendor profile.

Key Findings and Outcome

With the aid of SpendEdge’s vendor risk management solution, the client witnessed an increase in efficiency and transparency in their vendor relationship management process. A centrally hosted vendor risk management process helped lower costs for the organization by 12% and provided an easier mechanism of data exchange. Benefits included:

• Measuring ROI and reducing risk.
• Reviewing metrics and trends.
• Gaining common view of all risk.
• Analyzing risk at regular intervals.
• Developing a robust set of capabilities to assess the maturity of their existing program.
• Providing a strategic governance foundation for all enterprise initiatives and programs.
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Steps for Successful Vendor Risk Management ?

Devising a vendor risk management framework is a challenging task.  The process becomes invariably complex because of the large number of stakeholders i.e., procurement professionals, information and physical security, legal and regulatory compliance, and many more. Some key steps for establishing vendor risk management framework include:

• Identifying vendors.
• Prioritizing vendor-based risks.
• Tracking new vendors.
• Reviewing contracts.
• Keeping regular check.

Want to know more about the benefits of vendor risk management? Get in touch with our experts now!