--- title: [OR] [Pillar] Core Component [4] Third-Party Risk Management description: OR Core Component [4] Third-Party Risk Management image: https://blog.bcm-institute.org/hubfs/Operational%20Resilience%20OR/OR%20Core%20Component/IC_OR_Core%20Component_Third%20Party%20Risk%20Management.png --- [![BCMIWhiteLogo.png](https://blog.bcm-institute.org/hs-fs/hubfs/Blog%20Testing/BCMIWhiteLogo.png?width=556&name=BCMIWhiteLogo.png "BCMIWhiteLogo.png")](http://www.bcm-institute.org/) - [Home](https://www.bcm-institute.org/) - [About Us](https://www.bcm-institute.org/about-us-3/) - [A President’s Perspective](https://www.bcm-institute.org/about-us/a-presidents-perspective/) - [Our History](https://www.bcm-institute.org/about-us/our-history/) - [Our Advisory Council](https://www.bcm-institute.org/about-us/our-advisory-council/) - [Customers’ Testimonials](https://www.bcm-institute.org/about-us/customers-testimonials/) - [Credential Verification](https://www.bcm-institute.org/about-us/credential-verification/) - [Courses](https://blog.bcm-institute.org/blog/course-fees-for-blended-learning-courses-master-catalog) - [ISO 22301 Business Continuity Management System Audit](https://blog.bcm-institute.org/audit/business-continuity-management-audit-courses) - [ISO 22301 Business Continuity Management](https://blog.bcm-institute.org/bcm/business-continuity-management-courses) - [Crisis Communication](https://blog.bcm-institute.org/crisis-communication/crisis-communication-courses) - [Crisis Management](https://blog.bcm-institute.org/en/crisis-management/courses) - [IT Disaster Recovery](https://blog.bcm-institute.org/it-disaster-recovery/courses) - [Operational Resilience](https://blog.bcm-institute.org/operational-resilience/courses) - [Operational Resilience Audit](https://blog.bcm-institute.org/operational-resilience-audit/courses) - [Certification](https://blog.bcm-institute.org/certification/types-of-certifications-offered) - [ISO 22301 BCMS Audit Certification](https://blog.bcm-institute.org/certification/business-continuity-management-audit-certification) - [ISO22301 Business Continuity Management Certification](https://blog.bcm-institute.org/bcm/business-continuity-management-certification) - [Crisis Communication Certification](https://blog.bcm-institute.org/crisis-communication/crisis-communication-certification) - [Crisis Management Certification](https://blog.bcm-institute.org/en/crisis-management/crisis-management-certification) - [IT Disaster Recovery Planning Certification](https://blog.bcm-institute.org/it-disaster-recovery/it-disaster-recovery-certification) - [Operational Resilience Certification](https://blog.bcm-institute.org/operational-resilience/operational-resilience-certification) - [Operational Resilience Audit Certification](https://blog.bcm-institute.org/operational-resilience-audit) - [Seminars](https://blog.bcm-institute.org/meet-the-expert/mte-webinar-mainpage) - [Store](https://www.bcm-institute.org/store-2/) - [Contact Us](http://www.bcm-institute.org/about-us/contact-us/) - - ###### Operational Resilience Pillar Series ![BGBann_Playbook_Crisis Management](https://blog.bcm-institute.org/hs-fs/hubfs/Graphics/Background%20Banner/BGBann_Playbook_Crisis%20Management.jpg?width=2000&height=1333&name=BGBann_Playbook_Crisis%20Management.jpg "BGBann_Playbook_Crisis Management") # \[OR\] \[Pillar\] Core Component \[4\] Third-Party Risk Management This is a detailed discussion of the core components of Operational Resilience. The four major components that support the Operational Resilience effort are operational risk management, cyber resilience, business continuity management and third-party risk management. Third-Party Risk Management (TPRM) is an integral part of operational resilience. Organisations can strengthen their resilience to disruptions, maintain operations, and adapt effectively to third-party-related challenges by identifying, assessing, mitigating, and continuously monitoring risks associated with external relationships. [Moh Heng Goh](https://blog.bcm-institute.org/operational-resilience/author/moh-heng-goh) Jan 15, 2024 ###### Operational Resilience Certified Planner-Specialist-Expert ### Operational Resilience Core Component \[4\] ####  Third-Party Risk Management Third-Party Risk Management (TPRM) is an integral part of operational resilience.   Organisations can strengthen their resilience to disruptions, maintain operations, and adapt effectively to third-party-related challenges by identifying, assessing, mitigating, and continuously monitoring risks associated with external relationships.  [![New call-to-action](https://no-cache.hubspot.com/cta/default/3893111/cb2bc914-636c-4d77-aa9f-06324259bc7c.png)](https://cta-redirect.hubspot.com/cta/redirect/3893111/cb2bc914-636c-4d77-aa9f-06324259bc7c) TPRM is crucial in bolstering an organisation's operational resilience, especially in today's interconnected business landscape, where many operations rely on external vendors, suppliers, and service providers.  These are the factors that relate TPRM to operational resilience. #### Dependency and Interconnectedness Many organisations depend on third parties for critical services, products, or technology. Any disruption or failure in these third-party services can directly impact the organisation's operations. Operational resilience involves understanding and managing these dependencies to ensure continuity, making robust TPRM essential. #### Risk Identification and Assessment TPRM involves identifying and assessing risks associated with third-party relationships. These risks could include operational failures, cybersecurity vulnerabilities, compliance issues, or financial instability within the third-party organisation. Identifying these risks is critical to enhancing operational resilience by proactively addressing potential points of failure. #### Mitigation and Controls TPRM focuses on implementing controls and mitigation strategies to manage risks associated with third-party relationships. This contributes to operational resilience by reducing the likelihood and impact of disruptions caused by third-party issues. #### Contractual Agreements and BC-CM Planning Operational resilience requires robust contractual agreements with third parties that include business continuity and crisis management plans for disruptions. TPRM involves negotiating contracts that outline responsibilities during disruptions, ensuring that the organisation can maintain essential operations even if a third party faces challenges. #### Continuous Monitoring and Response TPRM involves continuous monitoring of third-party performance and risk factors. This proactive approach aligns with the broader concept of operational resilience, which emphasises the need for ongoing monitoring and adaptive responses to maintain operations amid disruptions. #### Recovery and Business Continuity In the event of a disruption caused by a third party, operational resilience includes having contingency plans and recovery strategies to minimise the impact and swiftly recover operations. TPRM contributes by providing insights into potential disruption scenarios and helping develop recovery plans.   [![\[Pillar\] \[3_4\] \[Banner\] \[C4\] Third-Party Risk Management](https://no-cache.hubspot.com/cta/default/3893111/1ab1982e-100b-41e9-b830-23583eeb5b97.png)](https://cta-redirect.hubspot.com/cta/redirect/3893111/1ab1982e-100b-41e9-b830-23583eeb5b97) | **Back To** | **Core Component Supporting Operational Resilience** | | | | | --- | --- | --- | --- | --- | | [![New call-to-action](https://no-cache.hubspot.com/cta/default/3893111/1d604e01-3b95-4617-81c2-5e6980742af8.png)](https://cta-redirect.hubspot.com/cta/redirect/3893111/1d604e01-3b95-4617-81c2-5e6980742af8) | [![New call-to-action](https://no-cache.hubspot.com/cta/default/3893111/25be8a58-a28f-4ddd-b1a7-cf57eb78f898.png)](https://cta-redirect.hubspot.com/cta/redirect/3893111/25be8a58-a28f-4ddd-b1a7-cf57eb78f898) | [![New 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