Today, SaaS vendors are becoming more of an influential factor in shaping how modern businesses operate. From vital messaging platforms and financial software to project management tools and Customer Relationship Management (CRM) systems, SaaS applications have become the backbone of today’s business operations. This shift towards external solutions enables organizations to channel their resources more strategically and unlock unparalleled efficiency and agility.
However, there are vulnerabilities within SaaS applications that can be exploited by malicious actors. This is one of the main reasons why security and IT teams need effective vendor risk management practices. As businesses delegate critical functions to external vendors, the significance of safeguarding against potential risks cannot be overstated. Therefore, security and IT teams are being tasked with securing their organization against the growing tide of SaaS-related security threats.
The management of vendors is taking center stage for organizations needing to protect themselves against potential third-party threats. Security and IT teams are now looking for ways to scrutinize the applications and third-party vendors linked to their organization, ensuring a robust defense against an ever-evolving array of risks. This is where conducting vendor risk assessments (VRA) becomes highly beneficial.
What is a vendor risk assessment?
In simple terms, a vendor risk assessment is part of the broader vendor risk management practice. It is the process of evaluating the potential risks posed by third-party vendors and service providers. This assessment helps security teams identify and understand various types of risks coming through third-party services. Those that relate to cybersecurity, including compliance gaps, operational issues, and reputational concerns. By having access to this type of information, companies can proactively address these risks and ensure a secure and well-protected SaaS supply chain.
The importance of a third-party vendor risk assessment
Ultimately, third-party vendor risk assessments are essential to identify and mitigate potential vulnerabilities introduced by third-party SaaS applications. In the broader sense, Vendor Risk Management (VRM) not only strengthens the overall security posture of an organization, but also demonstrates regulatory compliance, and provides insights into industry best practices. It can be said that there are both tangible security benefits that directly deal with third-party risk, but there is also broader business value to having secure and compliant vendors in your SaaS stack.
Consequences of inadequate third-party vendor risk management
In a recent KPMG survey, it was found that 73% of respondents had experienced at least one significant disruption due to a third-party vendor, in the last 4 years. Proving that failing to conduct proper risk assessments can have severe consequences for organizations. For example, cybersecurity breaches resulting from vulnerabilities introduced by third-party vendors can lead to the exposure of sensitive data, financial loss, and reputational damage, just to name a few. Non-compliance with data privacy regulations can lead to hefty fines and legal liabilities.
Vendor risk management as part of SSPM
Vendor management ties perfectly together with SaaS Security Posture Management (SSPM). Effective SSPM takes into consideration applications, users, and data. With this information, security teams can acquire a deep understanding of the access levels and permissions granted to third-party applications. This allows them to make better decisions and judgments that enhance the overall security of the organization. Having vendor assessments as part of your SSPM solution helps streamline the evaluation process before onboarding a new application – an essential step in the evidence collection required for ISO 27001 and SOC2 audits.
The benefits of leveraging the largest SaaS database for VRM
Using Wing’s SaaS applications database to conduct assessments and lookups on third-party vendors is an effective way to fast-track vendor risk assessments. This unique database provides critical information about SaaS applications, including their compliance status, security scores, permissions, and third-party connections. By utilizing such a database, organizations gain accurate insights into the risks associated with various vendors, enabling better decision-making and risk mitigation practices.
Using Wing’s reputation scores for ongoing management
The reputation scores derived within Wing’s SaaS applications database offer ongoing vendor management support. Organizations can continuously monitor the security posture of their vendors, ensuring they adhere to industry standards and best practices. Proactive vendor management helps identify potential risks and allows organizations to take the necessary actions to protect their data and reputation.
What is to gain from practicing effective third-party vendor risk management
Implementing these practices comes with numerous benefits. It empowers security teams to identify and address potential risks, leading to improved security and compliance. Through Wing, organizations can leverage the industry’s largest SaaS application DB to make more informed business and security decisions. A critical step when needing to onboard new SaaS vendors – one that prevents risky apps from entering the SaaS stack.
Ultimately, effective vendor risk management provides protection against potential security threats. It is a crucial aspect of third-party risk management that organizations cannot afford to ignore. By turning to Wing’s SSPM solution to leverage our SaaS applications database, companies can bolster their vendor management practices and gain valuable insights into potential risks. This proactive approach not only enhances data security and regulatory compliance but also fosters stronger relationships and establishes the organization as a responsible and trustworthy partner in the business ecosystem.
