Risk management in even a small organization can quickly consume more than the available time and resources. In a larger organization, it can be overwhelming. Achieving optimum efficiency is a must in order to mitigate risks, ensure resiliency and recovery, and function within a tight budget. Digital transformation is not just about technology, it is about reimagining risk management efficiency through dynamic databases and automation. Consider these seven ways that a digitally-transformed system dramatically changes how risk management tasks are performed.
Companies tend to have documents, spreadsheets, and databases used for risk management scattered in multiple places. Through digital transformation, it is possible to create a dynamic relational database that can serve as a single source of truth: an information foundation for the entire enterprise. This information foundation contains comprehensive risk management data about employees, facilities, applications, servers, vendors, processes, plans, and more. By eliminating siloed databases in favor of a single source of truth, information can be entered once and applied seamlessly across systems, greatly increasing operational efficiencies and ensuring data accuracy.
Risk management plans multiply as businesses expand and new risks are identified. Developing new plans has traditionally been a time-consuming and cumbersome task, especially if no plan exists that can be used as a general guideline. But when companies work with a trusted partner to digitally transform their processes, plan development becomes easier and faster by virtue of the vendor’s pre-built libraries, checklists, and templates. An expert risk management vendor will have encountered innumerable risk scenarios and packaged that experience into time-saving tools that provide businesses with a structured approach to plan development.
Technology is transforming every area of business today – and risk management should not be the exception. Through digital transformation, companies can take advantage of modern tools and technologies that can change the way organizational risk management is done. For example:
It is very difficult for risk management personnel to detect missing, improper, or inadequate recovery strategies when faced with hundreds of different departments, functions, and applications. A risk management system can alert personnel to any risk management planning gaps that might appear as changes are made in applications and processes in various areas of the organization. In fact, it can not only identify gaps but can also prioritize where greater risks exist. For example, a robust system can differentiate between a critical business process that has gaps in its recovery capabilities and a lower-tier service that needs to be addressed.
It can be tough to collect risk management data from experts spread across the enterprise. It is not uncommon to have to go back to the same expert multiple times to fill in blanks, which is frustrating for both the risk management staff and the expert. Digital transformation of risk management facilitates the process of gaining input from subject matter experts across the organization through customizable portals, user-friendly interfaces, and automated workflows and emails. Risk management staff can specify exactly what information needs to be provided, eliminating the need for repeated contacts with the subject matter expert. Plus, a good system will enforce consistent standards and best practices (for instance, through the use of dropdown menus), relieving risk management personnel of the responsibility to check and correct data entry.
Generating reports can consume hours every week at a smaller firm; larger firms may have staff dedicated to the task on a full-time basis. But with a strong risk management system, enterprise-level reporting is made easy. Because all data is stored in a single information foundation, reports can be run instantly to provide the data and insight necessary to make strategic decisions about risk management, resource deployment, and organizational resiliency.
Everybody – risk management personnel, executives, and all other employees alike – understandably dread the “annual update” process. Fortunately, massive updates that require the tedious manual review of global information to check for needed changes are eliminated when an organization embraces digital transformation. They are replaced with automated self-checks where the system regularly evaluates existing data across risk domains to identify where updates need to be made and then collects or solicits that information directly or sends an alert about the required update. Automated workflows and approval processes also serve to keep information accurate and up-to-date year-round.
Digital transformation is ultimately not about technology – it is about reimagining how business gets done. By boosting efficiency in these very practical ways, a digitally-transformed system can help risk management take a quantum leap forward. Rather than working endlessly on keeping the essentials of a program up-to-date, risk management personnel can leverage the full advantages of robust automation and modern tools, freeing them to focus on core and value-added activities that will systematically improve and strengthen organizational resiliency across the enterprise.