Why You Need Vendor Risk Management Software in 2022
Why Is Vendor Risk Management Important?
You‘ve taken all the necessary steps to protect your data and systems from cyberattacks. That’s good. But it’s not enough. Today more than ever you also have to be concerned about security in all of your third parties, like contractors, consultants, vendors and suppliers, that you rely on to create, produce and deliver your products and services to your customers. CB Insights reports that 44% of data breaches are caused by a third party. Perhaps even more worrisome, only 15% of these vendors informed the impacted parties that there had been a breach.
Outsourcing is an important component of running a modern business. Working with third parties can bring cost reductions, increased productivity and increased operating efficiencies. But it also brings increased security risks. As modern organizations continue to expand their digital footprint, security professionals need to ensure that none of the entities of their ecosystem are exposing them to unnecessary risks either directly, or through their ecosystem as well, which would be your fourth parties.
Whether you call it third-party risk management (TPRM) or vendor risk management (VRM) you need a system to review third parties for their security practices to help protect your business from existing and emerging risks.
Protect Against Third-Party Risks
Cyberattacks, including attacks through third parties, are increasing in sophistication and severity. With the average cost of a data breach well over $4 Million it is no wonder that third parties and vendors are being exploited as gateways. There are a number of contributing factors facilitating third-party cybercrime activity today. When it comes to vendor risk management, two of the most prominent are expanding attack surfaces and dependence on digital supply chains.
As your vendor portfolio grows so does the attack surface available to hackers. The number of potential entry points into a system expands with each vendor and each cyber-physical system the organization uses and for which they enable third-party access and privileges. Any third party that has access to your systems or that processes proprietary or sensitive information is a potential security risk. And anything connected to the cloud is a magnet for a cybercriminal.
At the same time, organizations are especially susceptible to disruptions in their digital supply chain, and hackers have discovered that these targets can be very lucrative. The upstream ripple effects can have serious consequences. One prediction is that by 2025, 45% of organizations worldwide will have experienced a cyberattack on their global digital supply chain.
What Vendor Risk Management Software Can Do For You
Organizations can face many of the same potential risks due to a third-party breach that they face from a breach of their own systems. Most visible is the potential for financial cost, for example from paying a ransom or suffering from cost of a supply chain disruption. If one of your vendors suffers a breach, it could damage your reputation almost as seriously as if you had suffered the breach. And if a third party introduces a vulnerability into your operations you could be liable for the legal and monetary consequences.
Implementing third-party risk management software can help protect you from these and other security risks in your vendor ecosystem. Among other benefits it can provide you with an automated process for:
- establishing the security posture of existing vendors
- streamlining due diligence and onboarding of new vendors
- monitoring your vendors’ security posture on an ongoing basis and alerting you to changes
- helping track compliance with regulations and industry requirements
- tracking security controls and risk mitigation
- offboarding vendors when necessary
Panorays Third-Party Risk Management
Panorays provides greater visibility for you and your stakeholders into your organization’s third-party cyber risk. With Panorays, you can easily present a comprehensive view of your entire third-party portfolio while pinpointing potential regulatory and security gaps.
Want to learn more about what to consider when evaluating third-party security management platforms? Download our guide.