Safeguarding Your Bank from Technology Supply Chain Risks: Proactive Strategies for Resilience

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The New Normal: Building Resilience in a Hyper-Connected World

In today’s lightning-fast digital landscape, the unexpected has become the norm. High-velocity disruptions can strike at any moment, threatening the very foundations of our interconnected world.

For banks, the stakes are particularly high. The increasing complexity of technology supply chains poses a significant risk to operational resilience, with the potential to disrupt customer trust and reputation.

As banks continue to rely on third-party vendors for critical services and products, the risk of supply chain disruptions becomes increasingly pronounced. A single point of failure in the supply chain can have far-reaching consequences, including data breaches, system downtime, and reputational damage. In this environment, banks must adopt proactive strategies to ensure the reliability and security of their technology supply chains.

Embedding Resilience into Banking Operations

Resilience is no longer a nice-to-have, but a must-have for Financial Services Institutions (FSIs) and their suppliers. FSIs can respond proactively to threats by embedding resilience principles and strategies into the design, build, test, and run phases of their services, aiming for the full embedding of “resilience everywhere.”

This approach enables FSIs to design robust security measures and operational resilience into the core architecture of their business services, ensuring that they can withstand disruptions and maintain continuity of service.

To achieve this, banks must focus on developing a culture of resilience that permeates every aspect of their operations. This requires a fundamental shift in mindset, from reacting to disruptions to proactively anticipating and mitigating risks. By embedding resilience into their DNA, banks can ensure that they are better equipped to navigate the complexities of the digital landscape and maintain the trust of their customers.

The Importance of Vendor Management

Ensuring the resilience of third-party vendors is essential to improving overall operational resilience posture. Banks must recognise that their vendors are an extension of their operations, and that vendor risk is, in fact, a shared risk.

By collaborating closely with vendors to ensure that they adhere to ambitious standards of operational resilience, banks can mitigate the risk of supply chain disruptions and maintain the continuity of their services.

Effective vendor management requires an initiative-taking approach, including regular due diligence, service level management, and performance reviews. Banks must also ensure their vendors have robust business continuity plans, including incident response strategies and disaster recovery procedures. By taking an initiative-taking approach to vendor management, banks can ensure that their vendors are equipped to manage disruptions and maintain the continuity of their services.

Building a Resilient Technology Supply Chain

Building a resilient technology supply chain requires a comprehensive approach that considers the complexities of the digital landscape. Banks must recognise that their technology supply chain is a critical component of their operations and that disruptions can have far-reaching consequences. By adopting a proactive approach to supply chain resilience, banks can ensure that they are better equipped to navigate the complexities of the digital landscape and maintain the trust of their customers.

To achieve this, banks must focus on developing a culture of resilience that permeates every aspect of their operations. This requires a fundamental shift in mindset, from reacting to disruptions to proactively anticipating and mitigating risks. By embedding resilience into their DNA, banks can ensure that they are better equipped to navigate the complexities of the digital landscape and maintain the trust of their customers.

Why IBM?

IBM has a set of differentiating capabilities that uniquely position us to support your Operational Resilience Journey.

We have a deep understanding of the complexities of the digital landscape and the importance of operational resilience in the banking sector. Our team of experts has experience in helping banks develop proactive strategies for resilience, including vendor management, supply chain resilience, and business continuity planning.

By working with IBM, banks can ensure that they are equipped to navigate the complexities of the digital landscape and maintain the trust of their customers. We take a comprehensive approach to operational resilience, recognising that it is a critical component of a bank’s overall risk management strategy. Our goal is to help banks develop a culture of resilience that permeates every aspect of their operations, enabling them to withstand disruptions and maintain continuity of service.

Contributors:
Kate Armstrong
Samuel Crompton
Manjit Chauhan
Marianne Monteforte