Risk & Compliance

Third-Party Risk 2.0: Measuring Vendors Beyond the Questionnaire

Score exposure using external signals, contract triggers, and runtime telemetry—so remediation isn’t guesswork.

The problem with questionnaires

Self-attestations age quickly and skew optimistic. They’re still useful, but they must be paired with observable data to reflect reality.

A layered model for vendor exposure

  • External posture signals: Domain hygiene, breach chatter, certificate and DNS hygiene, public issues repos.
  • Contractual triggers: Data processed, role (processor/controller), sub-processors, sanctions-screening obligations, audit rights.
  • Runtime telemetry: API rate anomalies, error spikes, unusual geos, overnight job expansions.
  • Behavioral history: Responsiveness to due diligence, prior incident transparency, SLA performance.

Scoring framework (keep it simple)

  • Impact: What could go wrong if this vendor fails? (data sensitivity, revenue dependence)
  • Likelihood: What do posture signals and history say?
  • Compensating controls: Tokenization, least-privilege access, network segmentation, escrow, business continuity.

Operationalizing TPRM 2.0

  • Bucket vendors by criticality (tier 1–3) on impact first, then refine with likelihood.
  • Automate external scans for top vendors; review quarterly for lower tiers.
  • Instrument critical integrations: log calls, origins, volumes; alert on drift.
  • Tie contract to runtime: When data types or volumes change, trigger a re-review.
  • Enforce remediation SLAs: Pre-agreed timelines for patching, MFA, key rotation.

30 / 60 / 90-day plan

  • Day 0–30: Inventory vendors; assign impact tiers; align on scoring rubric.
  • Day 31–60: Add external signals for top 20 vendors; enable basic API telemetry on crown-jewel systems.
  • Day 61–90: Link contract clauses to monitoring; pilot remediation SLAs on two vendors.

Metrics

  • % of tier-1 vendors with runtime telemetry and quarterly posture reviews.
  • Average remediation time on vendor exceptions.
  • % of integrations with least-privilege credentials.

Pitfalls

  • One-and-done diligence: Treating onboarding as the finish line.
  • Shadow integrations: Untracked scripts and connectors.
  • No consequence model: Findings without contractual leverage.

Outcome

A defensible, data-backed view of vendor risk that improves resilience and negotiation leverage.