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Vendor risk management & the SaaS supply chain

Why effective vendor risk management is a critical strategy for identifying, assessing, and mitigating risks within the SaaS supply chain. 

Reclaim control of your security posture.

In just minutes, Nudge Security discovers, inventories, and continuously monitors every cloud and SaaS account employees have ever created. No network changes, endpoint agents, or browser extensions required.

Immediately spot supply chain risks.

Accelerate security reviews to match the pace of SaaS adoption with insights on each provider’s security, risk, and compliance programs. Gain visibility across the SaaS supply chain to know if you’re in the blast radius of a data breach.

Work with employees, not against them.

The only way to manage SaaS security at scale is to engage with your workforce—not block them. Deliver helpful security cues based on proven behavioral science to nudge employees toward better decisions and behaviors.

“Nudge Security’s trial was very easy to set up. The first value right out of the box was something I knew was going to happen: We had 16 people with licenses for two different applications that offer the same capabilities. We were paying double for something we shouldn’t have been using in the first place.”

Chris Castaldo

“Nudge Security is a pretty comprehensive product. I was impressed with what was available in the employee offboarding playbook. I haven’t found any other product that will actually reset passwords for accounts outside of SSO, and Nudge is unique in more ways than just that.”

Robbie Trencheny
Head of Infrastructure
Cars & Bids

“Whether they're ready to admit it or not, every security leader is contending with a sprawling mix of cloud and SaaS providers, permissions, accounts, and identities. Until now, this emerging attack surface has been largely invisible and vulnerable to the types of supply chain attacks in the headlines week after week. Nudge Security recognized that securing the SaaS supply chain is one of the core challenges of modern cybersecurity, and that’s why the Ballistic Ventures team was so eager to invest.”

Kevin Mandia
Strategic Partner
Ballistic Ventures

“For years, the industry has treated cybersecurity as a technology problem when, in fact, it is humans that play the biggest role in keeping enterprises cyber secure. Finally, Nudge Security has emerged to tackle the hardest soft problem in the industry—human behavior.”

Nicole Perlroth
Best-selling author

"Attack surfaces are growing more complex as organizations adopt new cloud and SaaS technologies across a globally distributed workforce. Nudge Security helps provide organizations with increased visibility into today's modern attack surface, and enlists all employees to help protect it."

Mario Duarte
Vice President of Security

"I am of the opinion that SaaS sprawl is a good thing, you have to give your team the flexibility to explore and discover new tools that will help them become more effective at their job. Ideally all those apps should be authenticating in a centralized way using an identity provider like Okta, however, in the real world, it is imperative to have mechanisms in place to account, find and manage the sprawling of those apps and nudge users to help secure the flow of information."

Hector Aguilar
Fmr. President of Technology & CTO

“Modern CIOs face a difficult balancing act enabling a highly distributed workforce with access to data and technology while trying to control the costs and risks associated with unchecked SaaS sprawl. Nudge Security strikes the right balance and helps modern organizations like ours manage the tide of SaaS sprawl without constraining employees’ abilities to move the business forward.”

AJ Beard
VP Applications and IT
Unify Consulting

“Adversaries are constantly finding new ways to socially engineer employees and attack the vast supply chain of SaaS applications they’re using to gain access to organizations. Every CISO is aware of the challenge they’re up against, and now it’s our job to make sure every CISO knows about Nudge Security and the way they enable employees to be a key part of an enterprise’s defense.”

Roger Thornton
Founding Partner
Ballistic Ventures

“Today, every employee acts as their own CIO and can easily reach for a new cloud or SaaS tool to solve virtually any problem. While organizations see massive gains in productivity and employee satisfaction from such unencumbered IT adoption, cybersecurity has been slow to adapt.”

Ed Amoroso
Founder and CEO
TAG Infosphere
Former CSO

“The work that Jaime and Russell did together at AlienVault to build the Open Threat Exchange changed the way threat researchers and practitioners shared intelligence. As a longtime customer, it was a no-brainer for Castra to sign on as one of the first Nudge Security customers. We’re excited about the potential to use this groundbreaking technology to improve service delivery for our customers.”

Grant Leonard

“As more data moves to cloud and SaaS environments, threat actors are turning their sights on assets and user credentials of which security teams may have little to no awareness. Nudge Security has an innovative approach that helps security teams shore up their defenses against cloud and SaaS threats, starting at the critical point of making the unknown known.”

Chris Doman
Co-founder and CTO
Cado Security

“Even in cybersecurity, people’s attitudes and emotions are strong predictors of their behaviors. Security leaders are setting themselves up for failure when they implement security controls and policies under the false notion that employees will comply unconditionally, regardless of how frustrating or unreasonable they find the experience to be.”

Dr. Aaron Kay, PhD
J Rex Fuqua Professor of Management
Duke University
Professor of Psychology & Neuroscience
Duke University

“Security teams need to focus on fighting real adversaries, not their colleagues. Nudge Security alleviates the time spent chasing down employees to get them to follow security policies, and it does so in a friendly, automated way that’s much more effective and less stressful for everyone involved.”

Kunal Anand

“In today's SaaS-fueled enterprise, monitoring access at the network layer is no longer enough. Context is key, and 'SaaS context as control' becomes the basis for implementing modern identity- and data-based security controls. Nudge Security innovates beyond other cloud and SaaS security technologies by providing SaaS context quickly and efficiently across all applications and user accounts, managed and unmanaged, enabling security and IT professionals to modernize their SaaS governance efforts.”

Frank Dickson
Group Vice President, Security & Trust

"I recently had a chance to try out Nudge Security and the experience was amazing! Here is what I found awesome: They made it super easy to get started (configured in 5 mins). There were zero super aggressive sales tactics. Instead of hundreds of alerts, I got to see which ones mattered most right now. There are no heavy handed controls, it's based on 'nudging' users to make better security choices."

Damian Tommasino
Sales Engineer
Cyber Informants

Vendor risk management

In today's digital-first business environment dominated by SaaS applications, organizations increasingly depend on third-party vendors for essential cloud services and software solutions. As more vendors and services are added to the mix, the complexity and potential vulnerabilities within the SaaS supply chain snowball. 

That’s why effective vendor risk management (VRM) is a critical strategy in identifying, assessing, and mitigating these risks to protect organizational assets and data integrity. 

For the modern organization, the importance of vendor risk management cannot be overstated.

Understanding vendor risk in the SaaS ecosystem

The SaaS ecosystem, enriched with third-party services, introduces a myriad of security challenges. From data breaches to compliance lapses, the risks add up. And as IT and security professionals know, modern work runs on SaaS.

Understanding the potential threats third-party vendors pose is crucial to a robust vendor risk management program.

Here are some of the key risks organizations need to consider:

The complexity of SaaS dependencies

SaaS applications often rely on a complex chain of dependencies, including other third-party services and infrastructure. Picture a maze within a maze—that’s how intricate it can be. The interconnectedness can amplify risks, as a vulnerability in one service can potentially compromise the security of multiple applications across different organizations.

Data security and privacy concerns

One of the primary risks associated with SaaS vendors is the potential for data breaches and privacy violations. SaaS applications often handle vast amounts of sensitive data, which makes them an attractive target for cyberattacks. Ensuring vendors have robust data security measures in place is critical for protecting against unauthorized access and data leakage.

Compliance and regulatory risks

Organizations are subject to numerous, ever-changing regulatory requirements governing data protection and privacy, such as GDPR, HIPAA, and CCPA. When assessing and adopting SaaS vendors, it's essential that the companies are fully compliant with relevant regulations to avoid legal penalties and reputational damage.

Availability and business continuity

Reliance on SaaS vendors introduces risks related to service availability and business continuity that were much more controllable before digital transformation. Any downtime or disruption in the vendor's service can have immediate (and lasting) impacts on your organization's operations. Assessing the vendor's reliability and disaster recovery capabilities is vital to mitigate these risks.

Vendor lock-in and exit strategies

Vendor lock-in is a significant risk in the SaaS ecosystem, where switching between vendors can be challenging due to proprietary technologies, data formats, or authentication methods. Organizations must consider the long-term implications of being tied to a specific vendor and develop exit strategies to manage transition of services—without significant disruption or data loss.

The dynamic nature of SaaS itself

The SaaS model is inherently dynamic and evolving, as service updates and changes often happen faster than companies can keep up with. While this allows for rapid innovation and improvement, it also means that the security and functionality of a SaaS application can change without notice, potentially introducing new and unexpected risks.

Evaluating vendor security practices

Assessing a vendor's security practices—much like their regulatory adherence—is critical within the SaaS ecosystem. This includes evaluating their security policies, incident response plans, and compliance with security standards. Third-party security certifications, such as ISO 27001 or SOC 2, can provide assurance of the vendor's commitment to security.

The importance of due diligence

Conducting thorough due diligence before engaging with a SaaS vendor should be at the top of a business’s priority list. This process should consider all the risks mentioned above, and evaluate the vendor's financial stability, market reputation, and the maturity of their security and risk management practices. Even after deploying the vendor’s solution, ongoing monitoring is crucial to detect and address any changes in the vendor's risk profile.

Eight steps to establishing a robust vendor risk management program

Given all the risks associated with SaaS vendors, a comprehensive vendor risk management program can be a valuable tool. VRMs allow organizations to systematically identify, assess, manage, and monitor the risks associated with third-party vendors.

Think of a robust VRM as doing the best due diligence. 

Here's how you can establish a robust VRM program.

Step 1: Define Your VRM objectives.

Start by defining clear objectives for your VRM program, which may include ensuring compliance with industry regulations, protecting sensitive data, or maintaining service continuity. These goals will guide the development and implementation of your VRM strategies.

Step 2: Inventory and categorize vendors.

Create an inventory of all third-party vendors your organization uses, then categorize them based on the services they provide and their risk level. High-risk vendors, such as those handling sensitive data or critical operations, should be subject to more stringent evaluations and will require a deeper dive. 

Step 3: Conduct risk assessments.

Just as you would your own organization, use risk assessment methodologies to evaluate the security and compliance postures of your vendors. Assessments should cover data security practices, compliance with relevant regulations, and the vendor's own risk management processes. This step typically involves questionnaires, audits, and reviews of third-party certifications. (Nudge Security’s database of SaaS security profiles makes this process much easier.)

Step 4: Implement control measures.

Based on the risk assessment results, implement appropriate control measures, which may involve renegotiating contracts to include security clauses. It may also require vendors to implement additional security measures, or even lead to terminating relationships with high-risk vendors.

Step 5: Continuous monitoring and review.

A key component of a successful VRM program is continuous monitoring of vendor performance against agreed-upon security and compliance benchmarks. Vendor risk management software automates much of this process, providing real-time alerts to changes in vendor risk profiles.

Step 6: Develop Incident Response Plans (IRPs).

Prepare for potential security incidents involving third-party vendors by developing specific incident response plans. IRPs should outline steps to be taken in the event of a data breach or other security incidents, including communication strategies and remediation measures.

Step 7: Foster strong vendor relationships.

Maintaining good relationships with business partners is always a wise business practice, and a strong vendor relationship is no different, especially when the risk is so high. Keep the lines of communication open about risk management expectations and collaborate on security practices. Mutual understanding and cooperation can have a positive impact on the security posture of both parties.

Step 8: Conduct regular program reviews.

Regularly review and update your VRM program to adapt to new threats, changes in business operations, or shifts in the regulatory landscape—which are all bound to happen. Continuous improvement helps ensure that your VRM program remains effective over time.

Is there a difference between a vendor risk management program and a vendor risk management framework?

A vendor risk management framework provides a structured approach and all-encompassing  model that guides how an organization implements its vendor risk management program. What this means is that the framework establishes the principles, standards, and guidelines that shape the program's design and execution. A VRM framework is like a blueprint: it is strategic in nature, and offers a high-level view of the objectives, data governance, and scope of vendor risk management activities.

Key elements of a vendor risk management framework include:

Governance: Defines the roles, responsibilities, and oversight mechanisms for managing vendor risks.

Risk appetite and tolerance: Articulates the level of risk the organization is willing to accept from its vendors.

Methodologies and tools: Outlines the methodologies and tools used for risk assessments, monitoring, and reporting.

Compliance and regulatory requirements: Provides the compliance and regulatory standards that the program must adhere to.

Continuous improvement: Establishes processes for regularly reviewing and updating the framework and program to address new risks and regulatory changes.

Don’t go it alone: Using vendor risk management software 

Managing SaaS supply chain risk can be overwhelming, especially if you have to do everything manually. Thankfully, software solutions are available that automate and enhance the vendor risk assessment process. Vendor risk management software provides real-time insights into vendor performance, security posture, and compliance status—and can be an invaluable tool for managing vendor risk effectively.

With solutions like Nudge Security, you can automate a significant chunk of the entire vendor risk management process. Here are just a few ways Nudge Security can address the complexities and challenges of managing vendor risk

Vendor security reviews

Nudge Security automates the assessment process, allowing you to conduct thorough security reviews efficiently. This means faster decision-making and reduced time-to-market for new vendor integrations, ensuring that security never slows down your business operations.

Auto-categorization for easy management

Understanding and managing the diverse array of SaaS applications within your organization can be daunting. Nudge Security simplifies everything by automatically describing and categorizing every SaaS application—as it’s introduced. Whether it's finance, marketing, or DevOps tools, our solution enables easy search and filter capabilities, making it straightforward to manage your SaaS ecosystem.

Risk and security program insights

Stay ahead of potential risks with just-in-time vendor security assessments. As new SaaS applications are introduced, Nudge Security provides valuable insights into your SaaS providers' security, risk, and compliance programs. This proactive approach ensures you're always informed and ready to address any vulnerabilities or compliance issues.

SaaS supply chain visibility

Gain unparalleled visibility into your SaaS supply chain, including insights into your providers' own SaaS ecosystems. This 4th-party supply chain visibility is crucial for understanding and mitigating risks that extend beyond your immediate vendors, offering a comprehensive view of potential vulnerabilities.

OAuth permissions management

Nudge Security helps you understand the connections between your third-party applications, including detailed information on granted permissions and the employees who authorized them. Nudge also enables you to revoke unnecessary Google and Microsoft OAuth grants, tightening your security posture and reducing potential access points for cyber threats.

Software supply chain risk management

In the event of a supply chain breach, Nudge Security empowers you to respond swiftly and effectively. Receive real-time breach alerts, complete with detailed breach information and recommended actions. Our SaaS supply chain analysis tools help you understand the full scope of your SaaS ecosystem, allowing for quick assessment of the potential impact of security incidents.

Vendor breach histories

Knowledge is power, especially when it comes to managing vendor risks. Nudge Security provides access to comprehensive breach histories for your company’s SaaS providers and accounts. This information is invaluable for assessing vendor reliability and making informed decisions about your SaaS partnerships.

Nudge Security was built to help manage SaaS vendor risk. Not only do we provide a view into the upstream dependencies of your SaaS providers, but we also discover all SaaS apps and accounts as they are adopted, so you can dynamically identify when your own supply chain changes.

Get in touch with Nudge Security for more information about use cases or pricing, or start a free 14-day trial today.

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