Business and risk leaders can these three actions to accelerate the transformation of TPRM and achieve the full value potential of centralization and AI adoption:
1. Focus on the enterprise
TPRM is conducted in different verticals of the enterprise, which are structured and incentivized to focus on different metrics. Procurement may track contract compliance and vendor performance. Cybersecurity may be focused on incident response time and cost of breaches. Supply chain may care about supplier compliance and resilience metrics.
Yet, realizing the full potential of AI and centralization requires understanding your obligations at an enterprise level — such as regulations, board imperatives, or investor imperatives — as well as how these translate to third-party risks and connect to the metrics of individual business units. If you are only looking at specific risks, instead of how your ecosystem of third parties could impact the overall business, you are narrowing your view and may set yourself up for suboptimal decision making.
We’ve written previously about the concept of a “risk steward” — someone who is charged with prioritizing risk management…
