Partnering with other business peers is part and parcel of running a company to achieve specific strategic goals, increase efficiency and save costs by outsourcing non-core functions to better-experienced providers outside the organisation. And we all know that opportunities and risks are soulmates, they never fail to come together. So, even outsourcing comes with potential risks. In this blog, we will be discussing how you can manage and minimise such risks and earn profitable returns when collaborating with others.
3 Tips to Minimize Third-Party Risks
Companies need to recognise that risk is inevitable. However, there are a few things that organisations can implement to minimise the risk relating to third parties, which are mentioned below.
- Research About Them Before Onboarding: Conducting thorough research to know your business peers beforehand can help you gain trust and understand their company structure and analyse your partnership with them in the long run. Get a clear understanding of their business in all aspects, legal, finance, credit, etc., and check whether they breached any laws or data in the past.
- Ask for References and Testimonials: Whenever you are contacting them, ask for references, details, reports and testimonials of previous or existing business peers to know them better and evaluate any risks there itself. This will help you dive deep into estimating the risks and decide whether you want to partner with them or not.
- Automate Risk Third-Party Risk Management: Conducting research on such parties and taking the time out to assess the risk is both time-consuming and effort-taking, which can takeaway the concentration from core activities like sales and marketing. To avoid this, there are companies that offer risk management solutions that can automate the whole process, provide you with insightful information and offer tools for more promising and efficient company compliance management. And we have found one tool and service that could help you do so, in the next segment of our blog!
Best Tool To Automate Company Compliance for Third-Party Risks
One of the world’s biggest commercial data provider and business intelligence platform, Dun & Bradstreet, offers an interface called D&B Onboard to automate company compliance. D&B Onboard provides a single point of access to information and tools to evaluate risks in regards to onboarding a new third party in business. In addition, it keeps a constant tab on business entities to guarantee compliance with global laws and sanctions, which makes it easier for companies who are elevating their company in the world trade market. Further, it also views organisation family trees to understand corporate linkages and compliance risk management better. So, without any doubt, it is a gift package for all the businesses looking for risk management solutions.
Leveraging third parties can assist your business in gaining significant efficiencies, but you must remember that the inherent risk still exists. Therefore, consider the above key points and implement a flexible third-party relationship risk framework, such as D&B Onboard, to ensure that the third parties are performing effectively and that your organisation complies with laws and regulations.