DePaul University’s Arditti Center for Risk Management hosted its 4th annual Cyber-Risk Conference earlier this week with over 100 attendees. Three panels took place that day, one moderated by Anders Norremo, CEO of ThirdPartyTrust, on the topic of The Cloud and Third Party Vendor Managament. Panelists included Kyle Brunell, IT Risk manager at Ernst & Young; Shane Hibbard, Director of Information Security at Invenergy; Richard Latayan, Cybersecurity and Network Infrastructure Manager at Hollister.
The majority of businesses do not create the technology they use, whether it be the cloud, machine learning software, automated processes, or even physical devices like drones or automated vehicles. By necessity, companies must outsource development—and to a certain extent, management—to third party vendors. But what kind of risks and threats are companies exposing themselves to in the third party vendor dynamic? What are some successful models for third party vendor management?
This panel discussion revolves around advising on how to get started building a vendor risk assessment and management program in an organization with hundreds, if not thousands of vendors.
WHAT IS AT THE FOREFRONT OF VENDOR RISK MANAGEMENT?
Scope was the recurring theme of this panel as all panelists agree this is a key aspect in building any vendor risk management process. Scope involves mapping your vendors out across different industries, as well as, data protection — knowing what your sensitive data is up front and who is going to have access to it.
Past panels have mentioned executive buy-in & finding good measurements (Cyber Security Chicago Panel), and taking their organizations security to the next level (Cybersecurity and Manufacturing Panel) as challenges.
HOW CAN COMPANIES GET STARTED WITH BUILDING A PROGRAM?
Having recently joined Invenergy, Hibbard says he’s been meeting with the executive leadership at his organization regularly as he establishes a vendor risk management program. As we’ve found from previous panels and studies, executive buy-in has proved to be a necessity in the process as their engagement in information security correlates with vendor risk management maturity.
Latayan, who has experience in building security programs for companies like Walgreens, says Hollister is at the very early stages right now, so he had to get creative.
“When you start a security program you don’t typically get immediate funding, so my strategy involved partnering with the project management team, which allowed me to see the entire portfolio of projects. My entry point from there was sending out a newly developed security questionnaire to any new vendors we were going to work with and were going to share sensitive information with.”
Latayan also recommends leveraging internal audit, which can help to be the voice and awareness of the senior leadership team.
Brunell also adds to Latayan’s point, stating that piggybacking off of other’s efforts can be a great way to jumpstart a program. “Get integrated with the project management team or procurement process, or even legal.” He stresses that keeping it simple is also key, otherwise if you come off with too long of a questionnaire or too robust of a process, people will tend to avoid it.
“Don’t try and boil the ocean and try and get through all 1,000 vendors in one day. Get the ball rolling by starting with key vendors and build on from there” advises Brunell.
WHAT ARE SOME KEY METRICS PEOPLE SHOULD BE MEASURING?
The panel recommends mapping two things: coverage and effectiveness. Coverage meaures how wide the reach of your program is and how many vendors have gone through an assessment. Effectiveness measures how quick the turn around of assessments — the process should not become bottlenecked due to slow assessing as this can turn into a way for everyone to be wary of the process.
Ideally, tiering vendors based on criticality and assessing those first allows you to hone in and expose critical risks, allowing you to mitigate accordingly, rather than assessing vendors randomly. Here are 6 tiering criteria our clients use when measuring vendor impact:
- Type of Information
- Criticality of Service
- Ease of Replacement
- Volume of Information
- Legal and Regulatory Requirements
- Size of Commitment
HOW DO YOU GET THE VENDOR ENGAGED AFTER THE CONTRACT HAS BEEN SIGNED?
Hibbard says look for the leverage you have:
“Find champions within the company and make sure they know that security is important and that you’re going to need cooperation from them. Most people want to do the right thing — vendors want your business and want a good reputation in the industry so they should be willing to work with you as long as you go about it in a reasonable manner.”
Look for opportunities that allow you to have dialogue with your different vendors. For example, when a contract is up for renewal, take that opportunity to have a discussion about security — have legal teams help facilitate the conversation.
Norremo adds his personal experience:
“Most vendors are typically not insecure by choice — usually they don’t have the know-how, budget or resources, and that’s okay. That’s where I think it’s the enterprise’s responsibility to help them out and provide some guidance. What I’ve found is most vendors will appreciate the feedback — it’s like free consulting to them. They want to become secure, they’re just unsure of where to start.”
As we’ve taken notice, enterprises struggle with managing thousands of vendors. The design of current solutions don’t allow for scale. ThirdPartyTrust’s platform is built for scale, allowing information security teams to assess more vendors with better information without hiring more analysts.
To learn how our ThirdPartyTrust platform can help improve your TPRM strategy, request a demo now:
