Most businesses depend on their supply chains for success — but as the Covid-19 pandemic painfully demonstrated, few companies have a full grasp of their supply chain risk and know how to manage that risk well. 

One crucial issue is how you communicate with your vendors; vendor communication is a vital part of the procurement process. In this article we’ll explore several strategies for efficient and effective communication and how you can implement them. 

Why Is It Important to Communicate with Vendors?

That’s easy. If you don’t communicate well with your vendors, either one of you might change your operations in a way that harms the business relationship. Supplies might not be delivered, the cost of supplies might change, responsibility for a defect might be mishandled. Lots of things can go wrong. 

Poor communication can lead to missed bids, unwanted phone calls, and frustration for your purchasing organization and vendors. 

On the other hand, clear and effective lines of communication and easy-to-use collaboration tools can help you develop a solid, long-term relationship with your vendors. Maintaining good communication will:

  • Help to handle challenges that arise in the usual course of business, which means fewer supply chain disruptions.
  • Build trust and assure that vendor and consumer expectations are aligned.
  • Reduce the time, risk, and manpower required for day-to-day vendor management. Instead of devoting resources to resolving vendor concerns, a company can prioritize effective communication strategies to minimize vendor problems.

Effective Strategies for Talking with Vendors

As with every relationship, communication is essential to its success. Talking to suppliers appropriately can improve the quality of the relationship, so keep the following points in mind.

Set Clear Expectations

One of the first tasks in vendor risk management (VRM) is to communicate clear and realistic expectations to your providers. This entails specifying the scope, outputs, timelines, and performance metrics for your projects or contracts.

You should also explain your values, vision, and culture to your vendors and assure that their views on those issues align with yours. Setting explicit expectations helps to eliminate misunderstandings, disagreements, and delays and keeps all parties on the same page.

Communicate Regularly

Another important technique is to communicate with your vendors frequently and actively. This includes informing them of your progress, feedback, and challenges and soliciting their opinions, recommendations, and concerns.

You should also use a variety of communication channels, such as email, phone, video, and face-to-face meetings, and select the most appropriate one for the scenario. By talking with your suppliers frequently and actively, you can build trust, rapport, and collaboration while addressing any issues or opportunities.

Provide Constructive Feedback

Another approach for VRM is to give constructive feedback to your vendors. This includes appreciating their accomplishments, talents, and contributions while highlighting their areas for progress, problems, and missteps.

You should also offer detailed, actionable, and timely feedback while avoiding ambiguous, generic, or delayed input. By giving constructive comments, you may assist your suppliers in improving their performance, quality, and satisfaction while demonstrating that you respect their work and relationship.

Negotiate and Resolve Conflicts

A fourth approach is to negotiate and settle problems with vendors. This entails determining the root cause of the dispute, the interests of various parties, and the consequences of various actions. Then develop mutually acceptable solutions that benefit both sides.

You should also communicate with your vendors courteously, forcefully, and compassionately, avoiding blaming, accusing, or threatening language. Negotiating and resolving issues allows you to prevent escalation, harm, and loss while maintaining a healthy and productive relationship with your vendors.

Recognize and Reward

Recognize and reward your vendors. This includes expressing your thanks, respect, and acknowledgment for their efforts and accomplishments, and presenting them with incentives, bonuses, or recommendations that are appropriate for their performance and expectations.

You should also celebrate your victories, milestones, and achievements with them and provide feedback, testimonials, or reviews. Recognizing and honoring your suppliers will encourage, inspire, and retain them while strengthening your loyalty, reputation, and cooperation.

Learn and Improve

Learn from and develop your vendor relationships. For example, assess your performance, results, and satisfaction while recognizing your strengths, shortcomings, opportunities, and threats.

You should also seek input from your vendors and consider their viewpoints and recommendations. By learning and developing from your vendor relationships, you can improve your VRM skills, procedures, and outcomes while encouraging continuous development, innovation, and growth in your organization.

How to Encourage Vendors to Answer Risk Management Questions

Vendors fail to complete risk assessments for several reasons. Sometimes they simply have a bad attitude toward cybersecurity. Still, in most situations the reason is a mix of a lack of awareness of your vendor’s risk management standards and an inefficient risk assessment workflow.

Include a TPRM Clause in All Vendor Contracts

All vendor contracts, including master service agreements (MSAs), business associates agreements (BSAs), and any other service agreements used by your vendor response team, should include a section titled Third-Party Risk Management Program (or Vendor Risk Management Program). This gives you the right to impose certain risk management obligations on your vendors.

Develop Relationships With Your Third-Party Vendors

Third-party suppliers, like your workers, must feel that they are part of the team to contribute to a project actively.

One of the easiest and most successful methods to build a solid business relationship is to provide an orientation outlining the whole lifecycle of your vendor risk management program. Your vendors will appreciate your transparency and goal of streamlining process integration with their security solutions.

Have a Point of Cybersecurity Contact

This information should be asked during the vendor onboarding process or the orientation meeting described above. Keep the contact’s name readily available, and validate the information during yearly third-party vendor evaluations.

Avoid Email Correspondence

The email inbox is the poorest place to track time-sensitive projects. Risk assessment communications should be routed to a platform that will not bury your vital messages behind an ever-expanding list of unrelated security notifications.

Automate the Notification Process

Integrations that improve the risk assessment workflow make it simpler for vendors to perform risk assessments, encouraging them to submit the assessments more quickly. 

These interfaces work best with a third-party risk management platform that manages the whole risk assessment process.

Send Risk Assessments as Early as Possible

Risk assessments are best performed when they are distributed to suppliers as soon as feasible. For new vendors, this should ideally occur concurrently with request-for-proposal procedures.

ZenGRC Makes Vendor Compliance and Management Easier

Vendor risk management is not easy. You must communicate with a potentially large number of vendors, potentially quite often. A single person cannot do this every day with manual processes alone. 

ZenGRC is the most comprehensive GRC software for completely integrated and holistic risk management throughout your organization. ZenGRC provides pre-built and preloaded templates for frameworks like SOC 2, NIST 800-57, FedRAMP, ISO, PCI, HIPAA, and SOX so your teams can run quickly.

It can additionally automate evidence collection, simplify processes, and provide real-time reports to reduce human labor and shorten audit cycles by avoiding duplication, identifying overlaps, and quickly detecting gaps in your company’s information security and compliance efforts.

Improve transparency and multi-stakeholder reporting by delivering timely, burden-free status updates and simplifying vendor and third-party risk management questionnaires and assessments.

Contact us for a demo today to learn how ZenGRC can help you streamline your vendor risk management processes.