Managed IT services are often focused heavily on technical functions. After all, a managed services provider (MSP) is specifically hired to handle all of the day-to-day activities that go along with the management and administration of IT equipment. This includes monitoring customer networks for performance and security issues and providing helpdesk support for any technology-related questions and concerns. While ensuring that your IT system’s components are running smoothly and safely is a key part of managed services, some of the best MSPs take a little more of a holistic approach to IT management. This approach involves a wide array of services that intend to help clients’ operations run as efficiently as possible, not just their technology. One IT solution that falls under the “holistic approach” umbrella is vendor management – one of the most critical yet underappreciated services offered by MSPs. Keep reading as we explore the definition of a third-party vendor, examine what is included in the vendor management process, and discuss the value that vendor management services hold for your business.
Defining a Third-Party Vendor
Before we delve into the real focus of this article, we need to understand what a third-party vendor actually is. According to Security Scorecard, a third-party vendor is defined as “a company or entity with a direct written contract to provide products or services to your customers on your organization’s behalf.” A few examples of vendors include:
- Internet Service Providers (ISP)
- Hardware Vendors
- Software Vendors
- Datacenters/Colocation Facilities
Third-Party Vendor Management
To carry out their services, these vendors usually have access to a private company, employee, and customer data – something that can prove to be very risky when your vendors are not properly managed. In fact, a 2019 Beyond Trust survey found that 58 percent of enterprises believed that they had experienced a significant data breach caused by a vendor. The goal of vendor management is to minimize this risk and continuously monitor your vendors for compliance. Below are some of the key steps involved in the vendor management process.
- Auditing Your Third-Party Vendors: First things first – you need to know who your vendors are. While this may seem like common sense, only 34 percent of businesses know all of their third-party vendors. Yikes.
- Assessing Third-Party Risks: Once you know who you’re dealing with, it’s important to do some thorough research on all of your vendors, especially ones that can access your organization’s sensitive data. Look out for any red flags: has the vendor been breached before? Do they have negative online reviews?
- Monitoring Cybersecurity & Maintaining Compliance: Figuring out who your vendors are and assessing their level of risk is not all there is to vendor management. In fact, vendor management is an ongoing process that requires you to constantly monitor your vendors for potential cybersecurity issues that could compromise your sensitive data. Another ongoing factor is ensuring that your third-party vendors are compliant with the statutes that govern your industry. For example, if you work in the healthcare sector, you and your vendors must follow HIPAA regulations; failure to do so could result in expensive violation fines and more.
The Value of Vendor Management Services
Many large companies employ a dedicated vendor representative who is available to answer any questions and even offer recommendations regarding how to handle third-party vendors. So, when an issue pops up, the vendor works directly with the organization’s in-house IT staff to troubleshoot the problem. Unfortunately, unlike these big corporations who typically enjoy tight relationships with their IT vendors, small and medium-sized businesses (SMBs) lack the buying power to warrant dedicated vendor resources. To make matters worse, obtaining third-party vendor support from a vendor rep can be time-consuming and quite frustrating, as reps who deal with SMBs are often spread thin and have minimal insight into their clients’ needs. An MSP, on the other hand, has a team of experts on their side to serve as the all-important link between you and your many IT vendors. MSPs will work with your technology vendors to quickly remedy ISP outages, ensure the installation of software upgrades, and solve any application glitches, leaving your company with a more secure and better-performing network.
On average, enterprises interact with more than 180 vendors per week. When you consider all of these vendors your firm uses, you might realize just how much time and effort needs to be devoted to implementing an effective vendor management plan. While your internal staff might be able to handle some of the burdens, they have other more pressing matters to tend to that are directly related to your core business. IT vendors should serve as the resources you use to facilitate business activities that will eventually allow you to reach important milestones and goals, but they shouldn’t be your primary focus. Luckily, vendor management solutions offered by a trustworthy MSP like Contigo are aimed at exactly that: taking the pressure off your business to manage third-party vendors so that you can shift your focus back to your core offerings. Let us save the day by eliminating the worry that comes with managing vendor risk via the ultimate underdog: Vendor management services.