Global supply chains remain under pressure as trade restrictions, tariffs, and geopolitical uncertainty continue to reshape sourcing strategies. Organizations have found themselves scrambling to replace suppliers and diversify networks in response to swift policy changes. Yet this effort can often be complicated by third-party risk controls at the organization.
Compliance leaders can help by making the onboarding process for new suppliers and third parties faster without sacrificing risk management rigor. Two strategies — streamlining initial due diligence and having a risk-based monitoring strategy — can better enable business outcomes without sacrificing resilience.
1. Streamline initial due diligence for critical risks
Lengthy and comprehensive questionnaires can overwhelm both compliance teams and business partners, often resulting in delays and an abundance of low-value information. To address this, streamline your initial due diligence form to focus on the most critical risks. Various data sources — such as hotline reports, audit databases, enterprise risk management (ERM) systems, and external industry risk reports — can help you narrow the scope. In addition, review previous incidents and competitor challenges to further identify what truly matters for your organization.
Regularly collaborate with business and assurance partners (e.g., ERM, procurement, supply chain) to vet due diligence questions to ensure relevance. By posing questions on enterprise risks, the operating environment, and changes to the business model, you will uncover opportunities to modify existing questions or create new ones for third-party screening.
2. Tailor monitoring strategy based on risks
After onboarding, risks can emerge throughout the lifecycle of third-party relationships. To maintain effective oversight, implement a tiered monitoring strategy that matches the threat level of each partner. To do so, grade third parties as high, medium, or low risk using a combination of compliance data and business inputs, such as evaluation of tenders, audit results, and supplier performance data. Once categorization is complete, use it to help you allocate the right level of resources to each tier of third parties or suppliers.
Effective monitoring requires the involvement of business partners. To help them fulfill this role, produce playbooks that outline specific monitoring actions, training requirements, and communication protocols for each risk category. It’s important to collect ongoing feedback from the business to update risk rankings and refine monitoring strategies.