DRI Supply Chain & Third-Party Risk Management Flashcards
6 cards from real DRI practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 DRI Supply Chain & Third-Party Risk Management flashcards as text
What is the primary purpose of a third-party risk assessment in business continuity planning?
Answer: To evaluate vendors' ability to continue services during a disruption
Third-party risk assessments evaluate whether vendors and suppliers can maintain critical services during a disruption, ensuring the organization's continuity is not jeopardized by external dependencies.
Which document formally outlines the recovery expectations and responsibilities between an organization and its critical vendors?
Answer: Service Level Agreement (SLA)
A Service Level Agreement (SLA) formally defines the expected performance levels, recovery time obligations, and responsibilities of vendors during normal and disrupted operations.
What is 'concentration risk' in the context of supply chain continuity?
Answer: Over-reliance on a single vendor or geographic region for critical supplies
Concentration risk occurs when an organization depends too heavily on a single supplier or region, creating a single point of failure that can disrupt the entire supply chain.
During a supply chain disruption, what is the FIRST step an organization should take according to DRI best practices?
Answer: Activate pre-identified alternate suppliers
DRI best practices call for activating pre-identified alternate suppliers first to maintain operational continuity while the primary supplier disruption is addressed.
Which of the following BEST describes a 'fourth-party risk'?
Answer: Risk posed by your vendor's vendors who also support your operations
Fourth-party risk refers to the risk introduced by the subcontractors and suppliers that your own vendors rely upon, creating an extended chain of dependency.
What is the recommended frequency for reviewing third-party business continuity plans according to DRI guidelines?
Answer: At least annually or after any significant change
DRI guidelines recommend reviewing third-party BCPs at least annually or following significant organizational or operational changes to ensure continued alignment.