In a competitive, fast-paced business world, effective risk management is critical for growth and long-term success. This is true regardless of industry, business size or perceived vulnerability. But to see the maximum benefit, you need a comprehensive risk management strategy, along with the resources to implement mitigation measures.
Enter: risk management software. The right risk management software solution can prove critical to business growth and success. In fact, you often find risk management tools within governance, risk, and compliance (GRC) management software systems. For this reason, the terms “risk management software” and “GRC software” are often used interchangeably, although the latter tends to include a broader feature set and a range of functionalities.
What is Risk Management Software?
To fully appreciate the impact on a company’s growth potential, you need to be familiar with risk management software features and functionalities. Generally speaking, it includes a variety of tools that empower an organization in its efforts to identify, manage and mitigate risks.
Risk Identification Tools – A risk management software platform will include a risk repository and tools for identifying risks that are confronting your organization. Ideally, the platform should include key risk indicators (KRIs) for each potential threat. These risk identification repositories usually span a wide range of areas, including legal risks, financial risks, regulatory compliance-related risks, operational risks, and strategic risks, among others.
The best risk management software systems also include a feed with updates on newly-identified threats and other relevant news in the risk industry. These feeds are often included in a dashboard feature; they are also commonly configured as notifications or alerts.
Dashboards – Virtually all risk monitoring software will include dashboards that provide at-a-glance insights into the metrics that matter most to an organization’s risk management team. Ideally, the user should be able to customize these dashboards to include the most relevant information, presented in a way that is clear and concise.
Risk Assessment Tools – A well-designed risk management platform will include tools for assessing risk. Most systems have a classification or rating system that allows users to evaluate risks in a quantifiable manner.
Risk Monitoring – Risk monitoring is an essential part of an organization’s risk mitigation strategy. The best software systems will include definitions for key risk indicators, along with tools that can be used to track and evaluate those indicators as they are detected. Some platforms will also include prompts and reminders that aid in the risk monitoring process.
Regulatory Compliance – For many organizations, — especially those in the medical and financial sectors — regulatory compliance is a very real concern in the risk management landscape. Non-compliance can carry tremendously costly consequences. For example, a company in any industry can be subject to General Data Protection Regulation (GDPR) fines. Any organization that does business with an EU citizen must adhere to GDPR or face fines of $20 million or 4% of the company’s worldwide turnover for the prior fiscal year (whichever is greater.) With so much at stake, organizations need a risk management software system that allows users to identify relevant regulations and monitor compliance with those regulations.
Analytics and Reporting – Data-driven decision-making is sound decision-making. This is especially true in the world of risk management. An organization’s risk management team needs access to accurate data in order to evaluate threats and strategize for the future. The top risk management software platforms include analytics tools that visualize data in an easy-to-understand sort of way. These systems will also include reporting tools that allow users to export data for review in risk management strategy sessions.
Risks span a number of realms and a company may face a slew of legal, financial, regulatory, operational, and strategic risks. A good software platform will have tools and functionalities for managing and mitigating all of these risks.
Many risk management software systems also include useful project management-type features that allow an organization to manage and track its response to the identified risks and threats.
How Risk Management Software Solutions Drive Business Growth
The right risk management software platform will empower a business with tools for risk identification and tracking. This, in turn, allows for effective prioritization of risk mitigation efforts. But how does this lead to advancement and growth for an organization? Consider the following points.
Cost Savings – Every risk comes at a cost, with most threats resulting in a negative financial impact when all is said and done. Those resources and funds could be used in much better ways to grow a company and its operations. By proactively minimizing risk and avoiding those adverse effects, a company can push its resources toward growth and expansion instead of paying fines and penalties.
Improved Company Culture – Cultivating a strong, unified company culture is far easier said than done. A solid risk management strategy demands the creation of a highly-connected, risk-aware workforce. To get the most out of their risk management software, an organization must implement measures to promote communication and collaboration. It just so happens that this also creates a company culture that is conducive to business growth and improved efficiency.
Better Workflows – Risk management software typically prompts a company to re-evaluate its workflows and processes. This can lead to improvements that drive an organization’s growth and promote advancement.
Analytics and Reports – A well-built risk management software system can serve as a centralized repository for a company’s data. That data is then converted into easily-visualized analytics and reports. These metrics are useful for more than just risk management; the data can be repurposed by business leaders as they devise new operational workflows and business strategies. The end result: business growth.
You don’t need to look hard to find anecdotes where a company was forced to close up shop following an incident or situation that could have been avoided with a proactive risk management strategy. It’s clear that effective risk management and mitigation isn’t just important for a company’s growth; it’s essential for survival. GRC and risk management software provides the tools you need to proactively manage threats that can endanger your business.
At iTech, our GRC and risk management experts provide clients with cost-effective and efficient risk management solutions. Contact the iTech team today to discuss your business and its risk management needs.