What Is Vendor Risk Management (VRM)?

If you own a business, you will need one of these to pick up some slack, and If you're like most businesses, you probably don't think about vendor risk management very often. But then your company gets hit with a disruption of some kind, a supplier hasn't delivered on time, or you've been hit with an unexpected lawsuit from a customer injured by your product. Then what? VRM is the part of SRM that deals with the strategic management of third-party products and services. The goal of VRM is to limit risk exposure and ensure that using third-party products and service providers will not disrupt business or negatively impact business performance. You can do this by performing due diligence on all potential vendors before signing a contract. This will help you bypass legal issues (and save yourself some money!). It also means that when something goes wrong, you'll be able to minimize disruption to your business operations by knowing how to find another supplier quickly (or even take over production yourself). Vendor risk management is like a game of chess: you must think several moves ahead to ensure your strategy is sound. It's not enough to ensure you've got the right pieces in place, and you also have to think about what your opponents are doing and how they might try to undermine you even if they don't know what they're doing! Sometimes it's just better to prevent problems before they start than try to do damage control after they've already happened. Yet VRM isn't just about protecting yourself from potential threats: it's also about ensuring that you're using the best products and services for your business needs. So when it comes down to it, we all want what's best for our businesses.