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In an atmosphere of rising cyber threats to enterprises, especially in the form of supply chain attacks, third-party risk management (TPRM) has become a key concern for organizations. Companies are actively looking for solutions to manage and mitigate extensive risks and costs that accompany third-party cyber risks. Implementing a well-designed TPRM program can help your company effectively negotiate the negative impact of third-party cyber security risks. Companies need to consider this seriously as it can have a long-term impact on all technology business decisions in the organization and consequently, on all users and customers of your company and the viability of your business. Companies need to pay close attention to the scope and potential of a variety of third-party cyber security risks to your organization. These risks need to be assessed on their merit and prioritized according to their order of impact. Most importantly, companies need to find ways to either shift, mitigate, accept, or deny (low-level) the risks as required. If you are looking for an effective TPRM program for your local business, consider reaching out to Managed Security Services.

Why is Third-Party Risk Management Important?

The management of third-party relationships as well as the detection and control of cyber security risks associated with such relationships ultimately falls to the company and its senior leadership. However, it is also important to keep in mind that some of these risks will exist in any relationship or activity, irrespective of whether the task is outsourced or not. It is the responsibility of a company to manage those baseline risks as well as the added risks that come with vendor lifecycle management. If a company fails to pay adequate attention to these risks, it could potentially open itself up to scrutiny and even punitive action from regulatory authorities, suffer reputational and financial damages and lose trust and loyalty from all relevant stakeholders including customers, employees, and business partners, and other service providers. Potentially, if the breach or the damage proves irreversible and significant enough, the company may not even be able to get back to business. This is why third-party risk management is now critical for organizations of all sizes.

Best Practices for Third-Party Risk Management

Building an inventory

The first step to properly assessing third-party cyber security risks at any organization is to make a detailed inventory of all third-party service providers. These relationships will need to be sorted according to the order of priority. For instance, if a particular vendor has access to a lot more critical information than the next, then that vendor needs to be treated as a priority for mitigating security risks. This is because a compromise in your relationship with this particular vendor can potentially affect your company the most. Companies should also consider building a framework for sorting vendor impact according to the order of priority and refer to it when initiating new relationships with other vendors. 24/7 IT support can help companies build and implement an effective framework for assessing all third-party cyber security risks.

Have clear cybersecurity policies in place

It is critical for organizations to have transparent cyber security policies in place that govern their internal operations as well as relationships with third-party vendors. It is advisable for companies to insist on minimum viable security protocols for vendors to follow in order to have a working relationship with the company. Your internal company policies should also clearly state the data security responsibilities of each party. It is also a good idea to have clearly set response procedures for different emergency scenarios and other cases. It is the company’s responsibility to ensure that both Sim ploys, as well as service providers, are well aware of these policies.

Implement identity and access management controls

While it is always a good idea for companies to implement identity and access management tools, this is particularly true when it comes to dealing with third-party service providers. As companies grow in size and their operations become fraught with complexity, it becomes incredibly easy to overlook individual access to information. However, companies do need to be careful with the access especially when it comes to third-party service providers. This is where identity and access management tools can provide a comprehensive solution and enable companies to have granular levels of control over access to sensitive information.

Implement continuous user activity monitoring

In addition to access controls, it is a good idea for companies to also enable continuous monitoring of user activity when it comes to third-party vendors. This enables a high degree of visibility over who has access to sensitive information and mission-critical assets of the company and when they access such information. Ideally, companies should seek to implement a solution that is capable of monitoring and recording user sessions that remain available in a user-friendly format for further auditing. These reports can also come in handy when companies submit themselves to external audits or in the root cause analysis of a security incident, and even in assessing cybersecurity stance during internal audits.

Perform regular audits

That brings us to our final best practice suggestion. One of the best ways to ensure that your TPRM program is performing up to specification is to conduct regular audits of your third-party vendors. This way companies can maintain a close watch over the way third-party vendors access and use their critical systems and data. Companies can even use reports from user activity monitoring solutions and incident response systems in order to analyze this. For more information on this, please refer to Managed IT Services.