Your vendor risk management (VRM) program might look solid on paper — but how will it hold up when something goes wrong? A third-party cybersecurity incident, compliance failure, or service disruption may reveal potential issues.
That’s why a “set it and forget it” approach doesn’t work. A strong VRM program doesn't remain the same, but rather evolves over time. Continuous improvement is what keeps your vendor risk program responsive, effective, and aligned with your organization’s needs. It’s all about resilience.
Why Continuous Vendor Risk Management Improvement Matters
As your vendor ecosystem grows and changes, so should your program. A mature vendor risk management program adds real value. It supports strategic goals, improves operational efficiency, and strengthens resilience. Here’s how:
- Improves processes – Continuous improvement helps your VRM program become more efficient and effective. It’s about consistently looking for smarter ways to work: streamlining workflows, reducing manual effort, and eliminating redundancies. The result is a more agile program that makes the most of your time, tools, and team. Adopting automation and software tools saves time and reduces errors in your VRM processes.
- Supports business objectives – A well-aligned VRM program gives decision-makers the insight they need to weigh risk against opportunity. It becomes a tool for smarter, risk-aware decisions.
- Increases resilience – A continuously improving VRM program is built to handle both the risks you see coming and the ones you don’t. As you review and assess your VRM program, you'll be prepared to respond to vendor issues before they become bigger problems. Resilience isn’t just about reacting — it’s about being ready.
- Meets rising expectations – Vendor risk management is under the spotlight. With cyber threats, operational failures, and regulatory scrutiny on the rise, VRM has become a high-profile issue for boards, regulators, and customers alike. According to Venminder’s State of Third‑Party Risk Management 2025, about 70% of organizations said they feel pressure to improve their vendor risk management program.
Regulators expect more than basic oversight. Your approach to managing vendor risks should be continuously evolving. The financial services industry especially faces high expectations for VRM programs.
- Builds a stronger risk culture – Continuous improvement builds a culture where vendor risk isn’t just compliance’s job — it’s everyone’s responsibility. By regularly refining your program, you create an environment where potential issues are spotted and addressed early. That means fewer surprises and fewer gaps.
How to Improve Your Vendor Risk Management Program
Strategic, continuous VRM improvement doesn't mean you need a complete overhaul. Look for targeted changes that boost effectiveness, maturity, and alignment with business goals.
Here are practical ways to continuously improve your VRM program:
- Update documentation regularly – Keep your policies, processes, and procedures current, especially after changes to your program. Review at least annually and use documented issues as a feedback loop to improve training and workflows.
- Track program metrics – Monitor key indicators like vendor volumes, critical vendor inventories and issues, and onboarding timelines. Data shows where your program is working and where it’s lagging. For example, a backlog in vendor due diligence may signal a need for more resources or better tools.
- Invest in automation and technology – Manual processes slow things down and increase risk. Automation streamlines workflows, improves accuracy, and gives you better visibility into vendor performance and risk.
- Promote innovation – Encourage innovation in your VRM program. Evaluate any new ideas and changes you might be able to make. Collaborate with other departments like procurement, legal, IT, and compliance. This ensures everyone is aligned and offers new perspectives and ideas to improve.
- Outsource strategically – Some VRM activities can be effectively outsourced, resulting in reduced workloads and potential cost savings. Look to outsource activities like due diligence document collection and reviews or continuous monitoring to experts. This lightens the load on internal teams and enhances scalability without sacrificing quality.
- Review vendor risk assessment processes – Because vendor risks consistently change, your risk assessments need to keep pace. Set a schedule to review vendor risk assessments based on contract changes, emerging risks, or new regulatory requirements. At least annually is considered a best practice.
- Train and educate stakeholders – Just as your program should continuously improve, so should stakeholders and employees. Ongoing training ensures everyone involved in the VRM program understands their role and stays informed of industry trends and best practices.
Related Content: 12 Ways You Can Improve Your Third-Party Risk Management Program
A mature vendor risk management program isn’t a finish line — it’s a moving target. To keep from falling behind, your program must continuously evolve. As business priorities shift, new risks emerge, and regulatory expectations grow, ongoing improvement is what keeps your VRM program effective, resilient, and aligned with what’s next.
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