Organizations are increasingly relying on third-party vendors to drive innovation and gain competitive advantages. However, this extended enterprise model exposes businesses to greater risks that must be carefully monitored and managed. Three new trends are increasing third-party risks: increased regulatory scrutiny of supply chains, challenges with vendors' operations like disruptions, and economic volatility impacting suppliers' profit margins. Companies can reduce these risks by integrating vendor risk management software and processes to provide enhanced visibility of all vendor risks.

2. Organizations are gradually shifting away from independent operating patterns to interdependent models by
integrating specialist suppliers and using cutting-edge third-party software. This trend has given rise to the
extended enterprise, where businesses use an intricate system of third-party vendors to increase their overall
value, drive innovation, and gain a competitive advantage.
The usage of third-party services has grown dramatically
in recent years. Several companies even outsource critical
activities to gain benefits and cut costs. Organizations are
consequently exposed to notable risks in unprecedented
ways. One of the most challenging problems in the future
will be for businesses to ensure enough monitoring of
third-party vendors and mitigate risks before it is too late.

4. Three New Trends Driving Higher Third-Party Risk
Regulatory Scrutiny on Supplier Risk
Regulatory bodies are intensifying their focus on
supply chain risk, exerting more pressure on
organizations to enhance their risk management
practices related to third-party service providers.
Regulatory scrutiny on supplier risk
Challenges with vendors’ operations
Economic volatility impacting suppliers
Below are the three new trends that are increasing third-party risks in 2023:

5. Challenges with Vendors' Operations
Suppliers face more significant business
interruptions, and risks must be adequately
controlled. For instance: anti-fraud management,
privacy, and security.
Economic Volatility Impacting Suppliers
The fluctuating economic conditions are leading
to slimmer profit margins for suppliers, increasing
the risk of disruptions within the supply chain.

6. Conclusion
Companies can reduce third-party risk profiles by properly integrating risk management processes like Predict360
Third-Party and Vendor Risk Management software across the organizational hierarchy. This involves shifting from
an ad-hoc approach with no formal oversight over third parties – where risks are frequently accepted for short-term
rewards – to a more intelligent, risk-based strategy that corresponds with the larger corporate objectives.
Furthermore, Predict360's advanced third-party reporting
and dashboard features offer a transparent view of all
vendors' risks and current status. This enhanced visibility
empowers organizations to keep a vigilant eye on their
vendors and promptly address any issues related to
vendor risk. To learn more about the Predict360 VRM,
request a demo or visit
https://www.360factors.com/third-party-risk-management/