Understanding the ROI of Vendor Risk Management

This guide discusses the return on investment (ROI) of vendor risk management (VRM) and its significance for organizations. It outlines how effective VRM can protect institutions, safeguard customers, and enhance vendor relationships. The document explains the challenges in communicating the value of VRM to stakeholders, emphasizing the need for a clear ROI case to secure necessary resources. It details both tangible and intangible returns from VRM, including cost savings, efficiency improvements, and enhanced decision-making. The guide also provides a framework for calculating the ROI of VRM, highlighting the costs associated with vendor risks and the benefits of a mature VRM program. Additionally, it offers strategies for effectively communicating the ROI to stakeholders, including creating a business case and defining the problem clearly. By understanding and articulating the ROI of VRM, organizations can build a strong case for investment in their risk management programs.