SR-3(1): Diverse Supply Base

The sr-3(1): diverse supply base requirement is a practical resilience and supply chain risk control: it pushes you to plan for disruption by avoiding over-reliance on a single third party, a single region, or a single technology source for critical system components and services. For a CCO or GRC lead, the hard part is rarely the intent. The hard part is scoping (what exactly must be multi-sourced), making it executable (who must do what, at which step of the lifecycle), and producing evidence that an assessor can follow.

SR-3(1) is an enhancement under NIST SP 800-53 Rev. 5’s Supply Chain Risk Management (SR) family. The text is short, but it implies concrete operational mechanics: define the component/service categories in scope, evaluate sourcing concentration risk, design for substitutability where feasible, and formalize exceptions where it is not. Done well, SR-3(1) reduces outage and compromise blast radius when a supplier fails operationally, becomes legally restricted, suffers a security incident, or changes terms in a way that creates unacceptable mission risk.

Requirement overview (SR-3(1) in practice)

SR-3(1) expects you to employ a diverse set of sources for defined system components and services. Practically, that means you can explain, with evidence:

1. what you consider “critical” or “covered” components/services,
2. what “diverse sources” means for each category, and
3. how procurement and engineering decisions enforce (or formally waive) that expectation.

This is not a mandate to dual-source everything. It is a mandate to make deliberate, risk-based sourcing decisions and avoid silent single points of failure.

Regulatory text

“Employ a diverse set of sources for the following system components and services: {{ insert: param, sr-3.1_prm_1 }}.” ¹

What the operator must do with this text:

• Fill in the parameter (sr-3.1_prm_1) in your control implementation statement: list the component and service categories that must be sourced diversely.
• Demonstrate diversity for those categories through procurement strategy, architecture patterns, and third-party risk decisions.
• Prove it with artifacts that show sourcing analysis, selection, alternates, and exceptions.

Reference framework context: NIST SP 800-53 Rev. 5 ².

Plain-English interpretation

You need a plan so your system can keep operating if a supplier becomes unavailable, unsafe, or non-viable. “Diverse” can mean different suppliers, different authorized resellers, different manufacturing lines, different cloud regions/providers, or different software products that satisfy the same requirement. The right definition depends on what failure mode you are trying to survive (capacity outage, geopolitical restriction, supplier compromise, insolvency, licensing change).

A clean way to interpret SR-3(1): for the categories you declare in scope, you must avoid unmanaged concentration risk and keep at least one credible alternative path (technical and commercial) or document why that is not feasible.

Who it applies to (entity + operational context)

Entity types commonly in scope

• Federal information systems.
• Contractor systems handling federal data. (Source context: NIST SP 800-53 Rev. 5)

Operational contexts where SR-3(1) shows up

• New procurement and renewals for critical third-party services (cloud, identity, endpoint management, SOC/MDR, email, DNS, PKI/certificates, CI/CD tooling).
• Hardware sourcing (network equipment, end-user devices, specialized components).
• Software supply chain choices (commercial off-the-shelf software, open-source dependencies when “source” includes maintainers/registries).
• Architecture decisions that create lock-in (single cloud primitives with no exit path, proprietary encryption/HSM interfaces, non-portable identity constructs).

If your environment supports high-impact missions, regulated data, or operational availability requirements, expect assessors to probe deeper on concentration risk and substitutability.

What you actually need to do (step-by-step)

Step 1: Define “in-scope components and services” (fill the parameter)

Create a short, explicit list of categories that must be sourced diversely. Keep it operational, not academic. Common categories teams select:

• Cloud infrastructure and hosting services
• Identity and access management services
• DNS, DDoS protection, and edge services
• Endpoint management/EDR tooling
• Key management / HSM services
• Network hardware and critical appliances

Output: SR-3(1) scoping statement (your filled-in parameter) approved by the control owner.

Step 2: Assign ownership and decision rights

SR-3(1) fails most often because nobody owns the “alternate source” decision. Set:

• Control owner (often Supply Chain Risk, Procurement, or Security Governance).
• Architecture approver for lock-in decisions.
• Procurement approver for single-source selections and renewals.
• Risk acceptance authority for exceptions.

If you use Daydream for third-party risk management, map SR-3(1) to a named owner, an implementation procedure, and recurring evidence artifacts so audits don’t turn into archaeology. ¹

Step 3: Build a sourcing concentration inventory

For each in-scope category, maintain an inventory of:

• Primary supplier(s)
• Contract vehicle and renewal date
• Geographic/operational dependencies (where relevant)
• Known switching barriers (data gravity, proprietary APIs, hardware pinning, certifications)
• Current alternate(s), if any

Keep the inventory tied to your CMDB, asset inventory, or third-party register so it stays current.

Step 4: Define what “diverse” means for each category

Use a simple decision matrix. Example:

Category	Diversity standard (example)	Minimum evidence
Cloud hosting	Secondary provider feasible for critical workloads, or documented exit plan	Architecture decision record + exit runbook
Network hardware	Approved alternates list for key device classes	Approved manufacturer/reseller list
Managed security service	Backup provider identified or internal contingency	RFP notes + contingency procedure
DNS/edge	Secondary DNS provider or tested failover capability	Failover test record

You are not promising instant failover. You are defining a credible alternative sourcing approach and the conditions under which you would execute it.

Step 5: Embed SR-3(1) into procurement and architecture workflows

Add gates where decisions actually happen:

• Third-party intake: require the requester to state whether the service falls into an SR-3(1) in-scope category.
• Sourcing review: procurement checks whether an alternate exists or whether the request increases concentration risk.
• Architecture review: require portability or exit considerations for in-scope services (data export, configuration as code, identity federation patterns).
• Renewal workflow: trigger a “diversity check” before auto-renewals.

Step 6: Create an exception path that is fast but controlled

Some categories are effectively single-source in your environment (due to mission constraints, certifications, embedded hardware). Your exception process should require:

• Business justification
• Risk analysis (impact if supplier fails or becomes restricted)
• Compensating controls (stocking spares, escrow, added monitoring, contractual protections)
• Time-bounded review date
• Formal approval by the right risk authority

Step 7: Test the assumption

SR-3(1) is weak if alternates only exist on paper. Run periodic validation such as:

• Tabletop exercise for supplier outage
• Proof that data export works
• Review of whether alternates are still viable (pricing, compatibility, lead times)

Required evidence and artifacts to retain

Assessors typically look for traceable artifacts more than perfect diversity outcomes. Maintain:

• SR-3(1) implementation statement with the in-scope categories filled in (the parameterized list).
• Role/ownership matrix (control owner, procurement approver, risk acceptance authority).
• Approved supplier/alternate lists for in-scope categories.
• Sourcing concentration inventory (primary/secondary, renewals, dependencies).
• Architecture decision records documenting portability/exit strategy decisions.
• Exception register with approvals and compensating controls.
• Periodic review records (meeting notes, screenshots, tickets) showing the inventory and alternates are reviewed.

In Daydream, teams commonly store these as recurring evidence tasks tied to SR-3(1), so collection is continuous rather than a scramble during assessment.

Common exam/audit questions and hangups

Expect questions like:

• “What components/services are covered by SR-3(1), and who approved that scope?”
• “Show me where you evaluated alternate sources for this critical third party.”
• “Where is the exception documentation for your single-source cloud/identity provider?”
• “How do you ensure renewals don’t silently deepen concentration risk?”
• “Prove your alternate is viable, not theoretical.”

Hangups:

• Teams can describe diversity goals verbally but cannot produce decision records.
• “We have an exit plan” that is a slide deck, not an executable runbook.
• Alternates exist, but procurement has not validated they can be contracted within required timelines.

Frequent implementation mistakes (and how to avoid them)

1. Leaving the scope undefined. Fix: explicitly list the categories in the SR-3(1) parameter and get approval.
2. Treating diversity as a procurement-only problem. Fix: add architecture gates for portability and lock-in decisions.
3. No exception discipline. Fix: require written risk acceptance with compensating controls and periodic review.
4. Paper alternates. Fix: test at least one dependency (data export, failover configuration, compatible hardware sourcing) during a planned exercise.
5. Evidence stored in email. Fix: keep artifacts in a system of record (GRC tool, contract repository, ticketing system) with consistent naming.

Enforcement context and risk implications

No public enforcement cases were provided in the source materials for SR-3(1). That does not reduce assessment risk: SR-3(1) is commonly evaluated through program effectiveness and evidence quality under NIST SP 800-53 Rev. 5 assessments ². The operational risk is straightforward: unmanaged single-source dependency increases the likelihood that supplier disruption becomes a mission disruption, and it can constrain incident response options during a supplier security event.

Practical 30/60/90-day execution plan

First 30 days (Immediate): establish scope + control mechanics

• Fill the SR-3(1) parameter: define in-scope component/service categories.
• Name the control owner and approvals (procurement, architecture, risk acceptance).
• Stand up an initial concentration inventory for in-scope categories.
• Draft the exception template and register.

Days 31–60 (Near-term): embed into workflows

• Add SR-3(1) questions to third-party intake and renewal checklists.
• Create approved alternate-source criteria per category (what “diverse” means).
• Require architecture decision records for new in-scope services.
• Start collecting evidence in a single repository; configure Daydream tasks if you use it.

Days 61–90 (Operationalize): validate + mature

• Run at least one viability check for an alternate path (tabletop, export test, procurement pre-qualification).
• Review open exceptions; add compensating controls where gaps exist.
• Train procurement and engineering reviewers on the gate criteria.
• Produce an assessment-ready evidence pack mapped to SR-3(1) (owner, procedure, artifacts). ¹

Frequently Asked Questions

What counts as a “diverse set of sources” under SR-3(1)?

“Diverse” should be defined by you per component/service category, then enforced through sourcing and architecture decisions. Diversity can mean different suppliers, different providers, or a documented exit path if true multi-sourcing is not feasible ¹.

Do we have to multi-source every third party?

No. SR-3(1) is applied to the components and services you explicitly place in scope, and it supports risk-based exceptions with documentation. Auditors typically focus on whether you made deliberate decisions and retained evidence.

How do we handle cloud provider lock-in?

Treat “cloud infrastructure/hosting” as an in-scope category, then require documented portability or exit planning in architecture decisions. If a second provider is impractical, document the exception with compensating controls and a review cadence.

What evidence is most persuasive in an assessment?

Signed scope (the filled SR-3(1) parameter), a current inventory showing concentration and alternates, decision records for key sourcing choices, and an exceptions register with approvals. Evidence that renewals trigger review reduces “set-and-forget” findings.

Can “diverse” mean two resellers of the same manufacturer?

It can, if the risk you are mitigating is reseller failure rather than manufacturer failure. Document the threat model for that category and show why reseller diversity is the right control for that dependency.

We’re small. How can we meet SR-3(1) without doubling cost?

Narrow scope to truly critical components/services, then focus on credible alternates and exit planning rather than parallel contracts for everything. A disciplined exception process is acceptable when supported by clear risk acceptance and compensating controls.

Footnotes

1. NIST SP 800-53 Rev. 5 OSCAL JSON

2. NIST SP 800-53 Rev. 5