AI can help TPRM programs quickly assess the control efficacy and artifacts such as a vendor SOC II report, PEN test report, policies and procedures against an organization’s third-party evaluation controls/criteria 20, 30 or even 50 times faster.
TPM teams, IT, Security, Boards, and Regulators all have third-party risk at the top of mind today. As the recent global CrowdStrike outage so clearly demonstrated, the world is hyper-connected. Our markets are integrated and globalized, where productive partnerships are key to any business strategy.
Whether working with suppliers, service providers, contractors, third-party agents or other vendors, organizations are focused on ensuring that risks are managed rapidly and effectively in the virtual eco-system. Yet, Third-Party Risk management (TPRM) is often viewed as a necessary burden—a cost that must be factored into the value an organization produces.
At the same time - AI can help TPRM programs accelerate processes dramatically. AI can help teams quickly assess the control efficacy of their third parties, given new threats and risks. For example, a typical highly manual task of assessing third-party artifacts such as a vendor SOC II report, PEN test report, policies and procedures against an organization’s third-party evaluation controls/criteria can now be performed in a fraction of the time using AI. Similarly, third-party assessment controls/criteria can be kept up-to-date with regulatory mandates 20, 30 or even 50 times faster using AI.
Let’s look at 4 ways AI can Accelerate Core Processes in TPRM Programs:
- Faster Vendor Onboarding and Due Diligence.
According to a 2023 E&Y Third-Party Risk Management survey, 90% of respondent organizations take 30-90 days to complete a risk assessment on a vendor. TPRM teams work under mountains of unstructured information, coming from vendors, suppliers and service providers, at different times, in a wide variety of formats. All of it needs to be sifted through and correlated to assess risk: SOCII reports, financial data, security audits, compliance assessments, audits and SLA reports.
Onboarding and due diligence require TPRM teams to collect this comprehensive data, and map it to relevant products, processes, and regions that could be impacted. Even deeper due diligence may require this information to be cross-referenced to internal resources (legal teams, risk and process maps) and external governance data (ESG, GRC) to ensure the prospective third-party adheres to internal standards.
How can AI help? AI can analyze for risk and compliance in minutes, not months. AI can cut through those mountains of documents to digitize and parse data, compare, correlate and analyze – in seconds. AI can see, for example, which vendors comply or do not comply with your internal IT, security or contracting standards; surface them in minutes, and recommend ways to close gaps, before adverse events befall you.
- Ongoing Vendor Monitoring and Risk Assessment
TPRM teams need to complete assessments, especially of technology vendors, for complex and emerging risks. According to the Prevalent 2024 Third-Party Risk Management Study, 60% of respondents reported a third-party breach or incident in the last year. That’s ~50% more than the year prior. In the same study, 50% of respondents reported that they still rely on spreadsheets and multiple tools to assess and manage third parties. TPRM teams need to maintain an up-to-date understanding of third-party risk exposure. This means continuously monitoring and reassessing vendor certifications, compliance to standards, adverse vendor events information in the media, and performance against established risk metrics.
How can AI help? AI can perform a risk or compliance assessment in minutes, not months. AI can look at vendor documents and perform a difference analysis to compare, correlate and analyze what has changed from the last assessment – in minutes. AI can re-assess compliance artifacts that have changed against the organization’s internal controls for compliance. Now, vendors that no longer comply with your internal IT, security or contracting standards surface through this analysis, and action can be taken to close gaps and reduce the risk of an adverse event.
- Contract Evaluation and Adjustment
Legal, contracting and TPRM teams need to regularly evaluate, maintain, and adjust contracts to ensure they are in line with regulatory and business requirements. This process is complex, labor-intensive and results in a higher cost of compliance.
How can AI help? AI can perform a contract drift assessment in minutes, not months. AI can look at vendor contracts and perform a detailed analysis against master service agreements and standard or evolving clauses to compare, correlate and analyze what has changed from the last renewal – in minutes. Now, vendor contracts that no longer align with your contracting standards are easier to identify, so that your legal and contracting teams can bring them into alignment quickly and efficiently.
- Getting the big picture through centralized risk management.
According to the 2023 E&Y Third-Party Risk Management survey, 90% of respondents reported moving toward more centralized risk management. When risk management programs share information, everyone benefits from a more comprehensive picture. Enterprise, operational, IT, third party-management risk teams and technology enterprise architects alike are fraught with trying to understand where weak links and exposures lie. Organizations need to show how they manage risk and resilience, as well as align with international standards such as DORA. They need to do this not only to be compliant and to keep their organizations secure, but also to give assurances to their customers, partners, their own third-parties and regulators.
How can AI help? AI can analyze upstream and downstream processes to see the interconnectivity under the fabric of your operations and out into global supplier and vendor networks, to smartly signal anomalies and correlate information with speed and accuracy at levels of magnitude faster than humans can: 20, 50 or 100 times faster. And the benefit is clear: Those organizations that bounce back from the outages and adverse events learn from the impacts and grow stronger, strengthening weak links along the way.
How 4CRisk Revolutionizes TPRM
4CRisk’s award-winning AI-powered products streamline the high-friction processes of third-party risk management, vendor onboarding and ongoing vendor risk and contract management, while providing a clear picture of risk exposure in a fraction of the time compared with current conventional methods and systems. The automation and intelligent analysis provided by 4CRisk are performed with unprecedented speed and precision.
4CRIsk’s Ask ARIA Co-Pilot further bridges the gap between TPRM professionals and technology, enabling an intuitive, interactive approach to day-to-day work and decision-making. Ask ARIA Co-Pilot can interpret, analyze, provide answers to questions, and perform autonomous tasks within moments instead of hours or days. This speed, accuracy, and intuitive process give TPRM teams the ability to work quickly and efficiently, with instant access to relevant information.
4CRisk’s small language models, trained specifically on risk and compliance corpus, can digitize mountains of structured and unstructured information in minutes in a secure, private cloud environment. 4CRisk’s AI can read, parse and understand documentation up to 50 times faster than a human alone. 4CRisk products can categorize and map information to internal and external documents including industry standards to create an instantly readable understanding of relevant metrics.
Summary: AI for TRPM – Transform Your Program with AI-powered processes.
In an era where the complexities of TPRM challenge even the most robust organizations, 4CRisk's innovative solutions offer a transformative approach. The traditional burden of TPRM—marked by resource-intensive processes and high barriers to efficiency—can now be mitigated through advanced AI technology. By leveraging 4CRisk’s AI-powered products and conversational Ask ARIA Co-Pilot, 4CRisk turns the onerous task of managing third-party risks into an opportunity for enhanced value and security.
About 4CRisk.ai Products: Our AI products use language models specifically trained for risk, compliance and regulatory domains to automate manual, effort-intensive tasks of risk and compliance professionals, providing results in minutes rather than days; up to 50 times faster than manual methods.
Would you like a walkthrough to see what 4CRisk products can do for your organization? Contactus@4crisk.ai or click here to register for a demo.
4CRisk products: Regulatory Research, Compliance Map, Regulatory Change Management and Ask ARIA Co-Pilot are revolutionizing how organizations connect regulations with their business requirements.
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