It is more important than ever for financial institutions to manage vendors efficiently, but many struggle with the best way to successfully accomplish this. Most community financial institutions do not have a formal department dedicated to vendor management, and some still perform this process manually (on a spreadsheet for example), potentially leaving the institution vulnerable.
Camden, Alabama-based Community Neighbor Bank recognized the shortcomings of using a spreadsheet to track and manage its nearly 40 vendors. This method also made preparing reports for auditors cumbersome and time consuming. In response, Lisa Dailey, Assistant Vice President and IT Manager at Community Neighbor Bank, sought a solution to automate and streamline the vendor management process and help the bank to more efficiently manage contracts, renewals and other critical activities such as risk assessments.
“As our vendor list grew and cybersecurity risks increased, we realized that we needed a better way of calculating risk, identifying critical vendors, and tracking contracts and reports,” said Dailey. “We wanted to ensure our institution was efficiently managing all our outsourced relationships.”
After careful consideration, the bank determined that Safe Systems’ vendor management solution represented the most cost-efficient, proven method to control and manage its third-party risk.
Improved Risk Assessment and Due Diligence
Prior to implementing Safe Systems’ vendor management solution, compiling a complete list of all vendors and accurately performing the risk assessment on all vendors was a complicated task for bank staff.
“Performing the risk assessment on each vendor and understanding our inherit risk had been a challenging process,” said Dailey. “Safe Systems helped us understand how to manage the various risk levels of our vendors and the level of due diligence needed for each level.”
In addition to a more efficient risk assessment and due diligence process, the bank also benefits from the ability to proactively manage vendor renewals; a centralized location for all documents so staff and management and can easily access them; and detailed information for audit purposes and executive summaries for board review.
Enhanced Compliance Posture
The industry has seen regulators more closely scrutinizing the vendor management process within financial institutions, and it was often difficult for the bank to provide the level of vendor reporting that regulators required based solely off of a spreadsheet. Safe Systems’ vendor management solution has enabled the bank to more easily provide the proper documentation to examiners in a timely manner — enhancing the bank’s ability to meet regulatory requirements and increasing its compliance posture.
“We have received positive feedback from regulators since we made the switch from a manual to an automated process,” said Dailey. “Working with Safe Systems has improved our ability to meet the evolving regulatory requirements, and we’ve significantly reduced the amount of time spent monitoring and managing our vendors.”
“We are fully confident going into all exams because we can easily provide any reports requested, and we have a comprehensive view of all our vendors,” continued Dailey. “Safe Systems is truly a valued extension of our team.”
For more information, download our complimentary white paper, “Managing Risk with Truly Secure Vendor Management Program.”