As your financial institution’s vendor inventory expands, it’s increasingly challenging to keep on top of the never-ending tasks. From risk assessments to due diligence and ongoing monitoring, staying organized and compliant can feel like an uphill battle.
This issue is magnified when you’re relying on spreadsheets, emails, and disconnected systems.
A vendor management solution eases the process and solves some of the biggest vendor management challenges financial institutions face. Let’s look at the top challenges a vendor management solution addresses and how it moves your program forward.
Top 6 Challenges a Vendor Management Solution Solves
Vendor due diligence hurdles
Collecting and reviewing vendor due diligence documents is a top challenge for many institutions. It’s time-consuming to reach out to vendors, follow up, and then review and analyze each document. Not to mention, documentation requirements often vary depending on the vendor’s risk and product/service.
A vendor management solution helps your institution collect documents through automated emails and tasks. It can also review due diligence documentation and provide qualified opinions on the vendor’s risk across multiple risk domains.
Lack of subject matter expertise
A subject matter expert (SME) should review and assess the vendor’s risk within their relevant risk domain. This ensures the right person with the right qualifications reviews vendor risks. However, not every institution has SMEs available in each risk domain.
Vendor management software fills the gaps by offering qualified SMEs to review and assess vendor documentation and provide an opinion on the vendor’s risk and next steps your institution should take.
Poor vendor management consistency
When processes aren’t consistent, it creates significant gaps throughout vendor management. This causes missed risk indicators, duplicated efforts, and noncompliance. Institutions struggle to maintain consistency with large vendor inventories, complex onboarding processes, and evolving issues.
A vendor management solution provides structure and standardization through automated workflows, centralized documentation, and issue and performance tracking capabilities. It also offers a consistent approach to vendor risk ratings and criticality with customized criteria.
Burnt out employees
Vendor management tasks are rarely the same day-to-day. Employees juggle changing demands each day while often facing decreasing internal resources. Vendors need to be onboarded quickly, risk assessments need to be completed, and issues must be resolved. It’s no wonder employees end up overworked and overwhelmed!
A dedicated vendor management software eases the burden. Remove manual processes with automated tasks and oversight management. Easily store data in a centralized location with automated reporting to track issues, vendor statuses, and risk alerts.
Undeveloped documentation and reporting
Maintaining documentation allows stakeholders and regulators to easily reference data on vendor risks and program decisions. Reporting provides insights into the performance of the vendor management program and each vendor relationship.
Without a vendor management solution, these manual processes are difficult and time-consuming to maintain. Software provides a centralized place to track and store documentation and offers automated and customizable reports and dashboards. These reports allow your financial institution to gather real-time insights into vendor risks and performance.
Limited continuous monitoring capabilities
Vendor risks are dynamic and consistently changing. As new risks, like artificial intelligence and cybersecurity risks, emerge and become more complex, it’s challenging to monitor and track each vendor.
A vendor management solution offers real-time insights with risk intelligence. It ensures your institution is aware of changing vendor risk profiles and enables quick decision making to prevent bigger problems.
Choosing the Right Vendor Management Solution
It’s important to choose the right vendor management solution that benefits your institution. Consider your needs and how a software platform will help you accomplish those. Be sure to demo the platform and assess if it’s well-regarded in the industry.
Vendor management solutions like Venminder provide a user-friendly environment to manage vendor risks from beginning to end. It’s designed with compliance in mind to ensure you’re not only protecting your financial institution but adhering to strict regulations.
Everything you need to identify, assess, manage, and monitor vendor risks is built into the solution – including risk assessments, due diligence and vendor questionnaires, contract management, and proactive vendor monitoring.
Using a vendor management solution ultimately helps your institution solve internal challenges while improving risk management.