DRI DRI Supply Chain & Third-Party Risk Management

Question 1

What is the primary purpose of a third-party risk assessment in business continuity planning?

Accepted Answer

To evaluate vendors' ability to continue services during a disruption

Answer

To negotiate lower contract prices with suppliers

Answer

To identify which vendors offer the most features

Answer

To determine marketing partnership opportunities

Question 2

Which document formally outlines the recovery expectations and responsibilities between an organization and its critical vendors?

Accepted Answer

Service Level Agreement (SLA)

Answer

Non-Disclosure Agreement (NDA)

Answer

Statement of Work (SOW)

Answer

Memorandum of Understanding (MOU)

Question 3

What is 'concentration risk' in the context of supply chain continuity?

Accepted Answer

Over-reliance on a single vendor or geographic region for critical supplies

Answer

The risk of losing focus during an incident

Answer

Having too many vendors for one product

Answer

Concentrating recovery resources at one site

Question 4

During a supply chain disruption, what is the FIRST step an organization should take according to DRI best practices?

Accepted Answer

Activate pre-identified alternate suppliers

Answer

Immediately notify all customers of the disruption

Answer

Suspend all operations until the supplier recovers

Answer

Renegotiate the current supplier contract

Question 5

Which of the following BEST describes a 'fourth-party risk'?

Accepted Answer

Risk posed by your vendor's vendors who also support your operations

Answer

Risk from four separate vendor failures occurring simultaneously

Answer

Risk from the fourth tier of your organization's hierarchy

Answer

Risk from vendors in four different geographic locations

Question 6

What is the recommended frequency for reviewing third-party business continuity plans according to DRI guidelines?

Accepted Answer

At least annually or after any significant change

Answer

Only when a disruption occurs

Answer

Every five years during contract renewal

Answer

Quarterly regardless of any changes