CGEIT Question #82: Real Exam Question with Answer & Explanation

Question

The BEST way to manage an outsourced vendor relationship is by:

Options

• Aconducting periodic risk assessments.
• Breviewing annual independent third-party reports.
• Cproviding clear objectives and transparency.
• Danalyzing performance statistics from the vendor.

Explanation

The most effective way to manage an outsourced vendor relationship is to establish clear objectives and maintain transparency from the outset, ensuring both parties understand expectations and operational context. This proactive approach sets the foundation for successful collaboration and performance.

Common mistakes.

• A. Conducting periodic risk assessments is a component of vendor management, but it's a reactive or monitoring activity rather than the foundational "best way to manage" the relationship itself.
• B. Reviewing annual independent third-party reports (like SOC reports) is a crucial part of due diligence and ongoing oversight for security and compliance, but it doesn't encompass the holistic management of the relationship's day-to-day effectiveness.
• D. Analyzing performance statistics is a key monitoring activity to assess a vendor's delivery against established metrics, but it is predicated on having clear objectives and transparent expectations in the first place.

Concept tested. Vendor relationship management best practices

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