We'll go through the 10 most common vendor management errors so you can prevent from making these in your institution's program.
Welcome to this week’s Third Party Thursday! My name is Dana Bowers and I’m the CEO/Founder & Board Member here at Venminder.
Let's talk about some of the most common errors we see in vendor management.
It’s easy to get so deep in the weeds of your vendor management program that you make some pretty basic errors. Sometimes you need to take a step back and evaluate your program. Here are some of the ones that we see most often.
#1 – Too few resources committed to your vendor management program. Ask yourself these questions.
#2 – Too little documentation. The examiners will expect a robust policy and program, make sure yours isn’t a one pager and make sure it gets reviewed and approved annually (and when guidance changes).
#3 – Not enough detail in your program. Make sure the key points in the guidance are addressed and you cite specifically what consumer protection laws and regulations are considered.
#4 – Insufficient scope of coverage of all third parties. Are you missing a whole tranche of third parties? Sounds basic, but you’d be surprised!
#5 – Inadequate risk assessment or due diligence practices. Again let's ask -
#6 – De-centralized contracts. This is one of the most common and most difficult ones particularly if you didn’t start with a centralized approach and are now searching for ways to get all of the contracts together.
#7 – Failure to keep your management team informed. When’s the last time you presented to the board or risk committee?
#8 – Haphazard or inconsistent reporting. Develop standard reports and stick to them.
#9 – Failure to resolve outstanding audit criticisms. It’s easy to move on and try to forget about the last exam, but you need to follow through.
#10 – Inadequate support from the areas outside of your own.
So there's your 10. Make sure you have enough resources, document everything, include detail in your program, have proper scope of coverage, do proper risk assessment and due diligence, centralize contracts, keep management and board informed, consistent reporting, resolve criticisms and have adequate support.
Hopefully now knowing this can save you time and help get ahead of the vendor management game.
Again…I'm Dana Bowers and thank you for watching! If you haven’t already, subscribe to the Third Party Thursday series.