Oct 20 2022

Why chasing risk assessments will have you chasing your tail

Category: Risk Assessment,Security Risk AssessmentDISC @ 10:07 am

Third-party risk assessments are often described as time-consuming, repetitive, overwhelming, and outdated. Think about it: organizations, on average, have over 5,000 third parties, meaning they may feel the need to conduct over 5,000 risk assessments. In the old school method, that’s 5,000 redundant questionnaires. 5,000 long-winded Excel sheets. No wonder they feel this way.

The reason why risk assessments have become so dreaded is that it has always been a process of individual inspection and evaluation. For perspective, that’s roughly 14 risk assessments completed per day in the span of one year. How can we expect security, risk, and procurement professionals to get any other work done with this type of task on their plate? With the state of today’s threat landscape, wouldn’t you rather your security team be focused on actual analysis and mitigation, rather than just assessing? And, not to mention the fact that a tedious risk assessment process will contribute to burnout that can lead to poor employee retention within your security team. With how the cybersecurity job market is looking now, this isn’t a position any organization wants to be in.

So, now that you know how the people actually with their ‘hands in the pot’ feel about risk assessments, let’s take a look at why this approach is flawed and what organizations can do to build a better risk assessment process.

The never-ending risk assessment carousel ride

The key to defeating cybercriminals is to be vigilant and proactive. Not much can be done when you’re reacting to a security incident as the damage is already done. Unfortunately, the current approach to risk management is reactive, and full of gaps that do not provide an accurate view into overall risk levels. How so? Current processes only measure a point-in-time and do not account for the period while the assessment is being completed–or any breaches that occurred after the assessment was submitted. In other words, assessments will need to be routinely refilled out, a never-ending carousel ride, which is not feasible.

It should come to no surprise that assessments are not updated nearly as much as they should be, and that’s to no one’s fault. No one has the time to continually fill out long, redundant Excel sheets. And, not to mention, unless the data collected is standardized, very little can be done with it from an analysis point of view. As a result, assessments are basically thrown in a drawer and never see the light of day.

Every time a third-party breach occurs there is a groundswell of concern and company executives and board members immediately turn to their security team to order risk assessments, sending them on a wild goose chase. What they don’t realize is that ordering assessments after a third-party breach has occurred is already too late. And the organizations that are chosen for a deeper assessment are most likely not the ones with the highest risk. Like a never-ending carousel ride, the chase for risk assessments will never stop unless you hop off the ride now.

Show me the data!

The secret ingredient for developing a better risk management collection process is standardized data. You can’t make bread without flour, and you can’t have a robust risk management program without standardized data. Standardized data is the process of gathering data in a common format, making it easier to conduct an analysis and determine necessary next steps. Think of it this way, if you were looking at a chart comparing student test grades and they were all listed in various formats (0.75, 68%, 3/16, etc.), you would have a difficult time comparing these data points. However, if all the data is listed in percentages (80%, 67%, 92%, etc.), you could easily identify who is failing and needs more support in the classroom. This is the way using standardized data in the risk assessment process works. All data collected from assessments would be in the same format and you can understand which third parties are high risk and require prioritized mitigation.

CISOs who are still focused on point-in-time assessments are not getting it right. Organizations need to understand that risk assessment collection alone does not in fact equal reduced risk. While risk assessments are important, what you do with the risk assessment after it is complete is what really matters. Use it as a catalyst to create a larger, more contextual risk profile. Integrate threat intelligence, security ratings, machine learning, and other data sources and you’ll find yourself with all the data and insights you need and more to proactively reduce risk. You’ll be armed with the necessary information to mitigate risk and implement controls before the breach occurs, not the rushed patchwork after. A data-driven approach to third-party risk assessment will provide a more robust picture of risk and put an end to chasing assessments once and for all.

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Tags: data breach, Risk Assessment, Third Party Risk

Aug 28 2022

Why You Need a Third-Party Risk Management (TPRM) Program

Category: Vendor AssessmentDISC @ 9:56 am

What entity, or sector doesn’t engage with a third party in some way, shape or form? Not many. The reality is that outsourcing, contracting and subcontracting happen all the time and is the norm as businesses continue to embrace the core/context mindset and division of labor. The more you outsource, the more you need to have a robust third-party risk management process (TPRM), also known as vendor risk management, plan in place.

Risk management is not new, but the current iteration of TPRM logic typically focuses on three parts:

  • Risk assessment and analysis
  • Risk evaluation and
  • Risk treatment.

I had the pleasure of chatting with David Medrano, director of third-party risk management at Morgan Franklin, who shared his insight on the importance of TPRM and vendor oversight. Medrano explained that many enterprise entities may have over 1,000 separate third-party engagements and, therefore, must have a methodology to measure the risk each of those presents.

Medrano said that while many entities know their contractors, they may lack visibility into the contractor’s contractor; thus, a daisy chain of outsourced work may be taking place which places data at an unknown level of risk as the third party shares it with a fourth party and so on. The most important thing an organization can do, in this case, is to categorize vendors in the planning/strategy phase. Suggested risk buckets may include critical vendors, physical vendors and technology vendors.

“Bucket them according to how and what they do and how their third-party actions present a risk to you,” Medrano said. The risk from the coffee vendor, for instance, is not the same as the risk provided by an MSSP. He advised caution with regard to allowing more risk to be accepted than the vendor’s worth or value to the enterprise.

Medrano also advised keeping the methodology used uniform, as that can help manage risk while also showing customers, regulators and compliance entities that the company has a methodology in place to measure and address risk and explains the company’s thought processes with regard to its actions.

TPRM Tools

Ironically, there are a plethora of vendors (yes, third parties) who are prepared to provide you with tools to create your TPRM program, there are also standardized methodologies available from the U.S. government. For example, the National Institute of Standards and Technology (NIST) has created a TPRM framework to help companies create a consistent and uniform TPRM plan which is adaptable to their unique needs. The NIST framework can help you:

  • Prepare – Essential activities to prepare the organization to manage security and privacy risks
  • Categorize – Categorize the system and information processed, stored and transmitted based on an impact analysis
  • Select – Select the set of NIST SP 800-53 controls to protect the system based on risk assessment(s)
  • Implement – Implement the controls and document how controls are deployed
  • Assess – Determine if the controls are in place, operating as intended and producing the desired results
  • Authorize – Senior official makes a risk-based decision to authorize the system (to operate)
  • Monitor – Continuously monitor control implementation and risks to the system

In sum, every business unit should be using a TPRM system, regardless of if their engagement with third-party vendors is centralized or decentralized. Additionally, uniformity in the assessment is of paramount importance, Medrano said.

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Tags: Third Party Risk, Third Party Threat Hunting, Third-party risk management, TPRM, Vendor Security Assessment