3rd-party risk management starts before the onboarding process.
One of the things that stood out the most in our recent webinar with Ardent Partners, CPO Rising 2018: The Age of Intelligence, is the critical role that data intelligence needs to play across organizations.In fact, data visibility and improved analytics stands as one of the biggest strategic goals that CPOs see as holding the most potential to drive performance improvement. While CPO Rising 2018 focused more on leveraging data as a way to add value, when you’re talking about data visibility it’s hard not to think of the risk management potential it represents.
There is rarely a day when some story of 3rd-party error causes an otherwise well-regarded and trusted brand to be put into a very unwanted negative – and costly – spotlight. In many cases, a company is still responsible for the risk their 3rd parties create, adding even more repercussions. How much of that could have been prevented with a more robust onboarding process that includes data accessibility is hard to say.
But, showing how to put that data to work to mitigate risk was the basis of some Determine Cloud Platform demo webinars on linking Supplier Management (SIM) and Contract Management (CLM) solutions. The demos illustrated how the seamless integration between SIM, CLM and a single source of verified data is like building a sort of risk firewall that helps prevent 3rd-party risk from onboarding with your suppliers.
How SIM+CLM helps create a risk firewall.
Linking two solutions on a bed of common data creates a force multiplier. The ability to use data from anywhere in the system with any and all modular solutions is what makes this so powerful as a risk management tool. Here’s a glimpse of how it looks and works in the system.
Certification requirements included upfront – all of them — Say you meet a 3rd-party vendor at a trade show, and they have a great product or service that would be perfect for the project you’re working on. When you invite that supplier into the system, whether you fill out the information or they do, the Supplier Management solution automatically includes the mandatory certifications required from that 3rd party based on their industry. That list is configurable to your own needs, ensuring that you can easily keep up with changing regulatory and industry mandates:
Only when a 3rd party has furnished all the requested pieces are they eligible to be approved:
The system automatically defines and includes the person who has final approval based on the workflow you build based on any piece of metadata in the system – industry, region, etc. Including this step prevents the possibility of circumvention:
Parallel workstreams: Mitigating risk while maximizing efficiency — At the speed of business, the ability for different teams to work simultaneously shaves valuable time off your processes. On the Determine Cloud Platform, integrated data and interconnected workflows mean you can act faster on opportunities with confidence – for instance, invite a supplier to an RFP and even negotiate a contract before they are approved.
Onboarding a 3rd party and reviewing certifications can be done while the contracts are being created without waiting for handoffs from team to team. As soon as any metadata enters the system for that supplier or vendor, it’s available to use so tasks that normally would have to be in sequence are accelerated. The control is built in — the system prevents you from (for instance) making a purchase against that contract until final approval:
Once a supplier is approved, the contract is all ready to execute against:
Aggregating data, accelerating confidence.
Obviously, there is a lot more to the risk mitigation capabilities available on the platform than these few images can convey. From setting alerts for expiring contracts and supplier certifications to controlling spend, leveraging savings, monitoring capex/opex budgets and reporting, having holistic visibility across your data is how to keep from onboarding risk into your organization.
To get a first-hand look at what integrated Supplier Management and Contract Management on the Determine Cloud Platform can help you create a risk firewall, schedule a personalized demonstration.