Emerging technologies and tightening regulatory requirements; limited budgets and staff knowledge; static contracts that don’t evolve with the times; overlapping contracts that create costly redundancies. There are a million different factors that stand in the way of a credit union achieving maximum return on its vendor investments. That's why this week, CreditUnions.com features strategies and case studies from credit unions with robust vendor management processes.
Credit unions pay good money for cutting-edge products and services. In "6 Rules To Maximum Vendor Value," Callahan writer Aaron Pugh shows how the industry’s credit unions can avoid being shortchanged upon delivery.
To cut costs and improve processes, Mazuma Credit Union has doubled down on its relationship with its longtime vendor management consultant to help it better negotiate contracts, monitor performance, and generally manage its 120 vendor touchpoints. Learn how Mazuma employees work alongside one another to reduce costs, create process efficiencies, and remain compliant in "Vendor Management Makes Mazuma More Transparent" by Callahan senior writer Marc Rapport.
There are pros and cons to outsourcing. On the one hand, outsourcing frees up credit union employees to accomplish other tasks. On the other hand, managing third-party relationships requires diligent oversight on the part of the credit union.
Cheryl Turner, contracts administrator at Illinois-based BCU, plays a key role in the credit union's comprehensive vendor management strategy. Her role encompasses responsibilities such as drafting request for proposals (RFP) and performing due diligence and annual reviews. In "Lessons In Vendor Management," Turner discusses how the credit union reviews vendors and best practices she’s gleaned in her role.
Credit union auditing and compliance staffers are well aware that vendor management practices have been on the radar of regulators since the 2013 Target breach in which hackers accessed data for nearly 100 million accounts through a third-party IT vendor’s login credentials. NCUA is contemplating more auditing requirements for IT vendors, and credit unions across the country are undergoing audits of their vendor management programs.
Purdue Federal Credit Union underwent its first audit last August. Two years before, the Indiana credit union had converted from a paper-based system to an electronic vendor management portal to manage contracts and compliance documents for some 300 outside vendors. That made the process go more smoothly, but Kristen E. Edmundson, vice president of audit and compliance at Purdue Federal, says more work needs to be done across the industry to enhance compliance with Federal Financial Institutions Examination Council (FFIEC) requirements.
In "Vendor Management In A Brave New World Of Compliance," Edmundson, a lawyer who previously worked in commercial real estate and in the Indiana Attorney General’s office, shares her perspectives on pain points, best practices, and the future of compliance.
Finally, if the thought of selecting a third-party vendor causes stress or confusion, don't worry. That's not an unusual reaction. Luckily, the steps outlined in the CreditUnions.com Graphic Of The Week "6 Steps To Select A Vendor" will help any credit union establish beneficial supplier relationships.