VRM Is Hard — Here's Why and How to Succeed
The VRM Challenge Landscape
Developing and maintaining a vendor risk management practice is no easy task . Understanding the challenges is the first step to overcoming them.
Challenge 1: Getting Stakeholder Buy-In
The Problem: Convincing executives and stakeholders of VRM's importance is difficult, especially without visible ROI .
Why It Happens: VRM's benefits (preventing incidents) are harder to quantify than its costs. Many executives see VRM as a cost center rather than a value driver.
How to Overcome:
- Translate vendor risk into business outcomes (dollars, downtime, safety)—not colored heatmaps
- Connect VRM to loss exposure, mitigation cost, and operational impact
- Use Cyber Risk Quantification (CRQ) to translate vendor exposure into concrete financial terms
Challenge 2: Identifying All Vendors
The Problem: Some large organizations don't have a centralized location to manage all vendors. Understanding what's in use and who is using it on a day-to-day basis is a complex task .
Why It Happens: Vendors are onboarded by different departments, through different processes, without a central register.
How to Overcome:
- Automate vendor discovery
- Implement a centralized vendor inventory
- Use risk-based tiering to prioritize and contextualize risk
Challenge 3: The "Long Tail"
The Problem: Teams pour energy into the obvious "critical" vendors while the broader ecosystem remains lightly assessed, inconsistently monitored, and operationally under-controlled . It's that long tail that will eat you much more quickly .
Why It Happens: Resource constraints force prioritization of obvious risks. The long tail is invisible until it's too late.
How to Overcome:
- Implement a scalable triage and monitoring approach
- Use AI to automate evidence review
- Focus on the "long tail" that can hurt you faster than critical vendors
Challenge 4: Manual, Inefficient Processes
The Problem: Manual input on spreadsheets is time-consuming and prone to human error . 76% of GRC professionals still spend 30% or more of their working hours on repetitive, manual administrative tasks.
Why It Happens: Legacy approaches rely on manual evidence collection and assessment.
How to Overcome:
- Leverage technology and automation
- Adopt specialized TPRM software
- Use AI to automate evidence review
Challenge 5: Uncooperative Vendors
The Problem: Some vendors do not provide complete or timely information, adding to assessment difficulties . Large vendors may refuse to upload documentation, share reports, or play nicely with your third-party risk management tools .
Why It Happens: Vendors have limited resources or see VRM as a burden rather than a partnership.
How to Overcome:
- Treat non-cooperation as a risk signal
- Exercise leverage where you can
- Use alternative data (threat intel, outside-in scans, etc.) when you can't
- Negotiate stronger contractual clauses covering data access and transparency
Challenge 6: Keeping Up with Regulations
The Problem: Changing laws and standards—and remaining current with them—adds further complexity . The evolving threat landscape requires continuous updating of assessment criteria and controls .
Why It Happens: Regulations are increasing year-on-year, and enforcement is tougher.
How to Overcome:
- Use horizon scanning to quickly identify and mitigate emerging risks
- Establish dynamic frameworks that adapt to regulatory changes
- Provide continuous education and training
Challenge 7: Data Quality and Integration
The Problem: Non-integrated platforms across departments (IT, procurement, legal) escalate operational inefficiency . Opaque visibility into sub-tier vendor activities is harder to monitor without adequate technological interventions .
Why It Happens: Different departments use different tools and processes.
How to Overcome:
- Centralize incoming information to see the big picture
- Move from reactive to proactive risk management
- Adopt a hub and spoke governance model
The Bottom Line
VRM is hard, but the alternative—unmanaged vendor risk—is harder. Organizations that acknowledge these challenges and build systematic approaches to overcome them will be better positioned to protect their business.
Action Items for Your Organization
- Identify your top VRM challenges
- Develop strategies to address each challenge
- Leverage technology and automation
- Build cross-functional collaboration
- Provide continuous education and training
