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Enterprise Risk Management Procedures That An IRM Can Streamline

Managing enterprise risk in today’s business landscape is a multifaceted, complicated affair that involves bringing together varying data streams from different departments to identify threats and opportunities. Fortunately, enterprise risk management (ERM) frameworks have emerged to address these challenges, enabling organizations to identify, plan/prepare for, and mitigate both traditional and new risk exposures (e.g., digital/cyber) in a unified manner, before they turn into a liability for the business. However, enterprise risk management procedures can quickly become unwieldy and ineffective when left to manual processes and rudimentary tools, often resulting in the creation of more risk, rather than its reduction. Suffice to say, today’s vast datasets and stakeholder/employee expectations require robust solutions beyond standard spreadsheets.

To support modern ERM initiatives, integrated risk management (IRM) solutions allow organizations to drastically improve their ability to measure, understand/quantify, and mitigate risk through unified data and automation. IRM brings about improved accuracy, better insights, and streamlined access to data, empowering teams to focus more on strategic initiatives and customer-focused improvements. 

In this article, we’ll explore several of the crucial enterprise risk management procedures an IRM solution helps to streamline, enabling organizations to effectively manage risk in line with the expectations and risk appetite of the organization.

 

Comprehensive Control and Risk Visibility 

Comprehensive situational awareness across the enterprise is a core prerequisite for effective risk management; achieving it requires the integration and embedding of ERM into the firm’s management processes throughout the organization. With an IRM solution in place, firms can more readily surface/identify risks, assess their impacts, and glean key risk insights for more comprehensive control and mitigation. 

An IRM solution provides the enterprise with a centralized platform for monitoring/reporting on key risk indicators (KRI), keeping track of actions/tasks for mitigating risk, automating workflows, and more. Decision-makers and managers are at once empowered with the necessary tools and insights for effective risk management, whether it involves accepting, transferring, or mitigating/eliminating the identified risks. And with all of the organization’s risk processes and data dynamically aggregated and consolidated in an IRM solution, compliance activities like administering control tests and reviews become a highly automated, easy-to-audit affair.

 

Promoting Risk-based Thinking Across the Organization

Of course, an IRM solution’s benefits go beyond the streamlining of compliance initiatives. A competent IRM platform enables key stakeholders to comprehend critical risk factors impacting various facets of the business (e.g., financial performance, operational health), as well as propagate a culture of risk awareness and risk-based decision-making across the enterprise. For example, an IRM solution provides the reporting and analytics necessary for analyzing top/emerging threats and taking the proper measures to bolster the organization’s risk posture against those threats.

 

Merging Risk Management with Risk Transfer

IRM solutions allow for integrated/streamlined workflows to link together previously disparate enterprise risk and insurance processes in a single platform. Because information is no longer siloed across separate systems, both insurance activities and ERM can draw from a unified body of knowledge for sharing common operation information; additionally, enterprises can connect risk transfer controls with the organization’s actual insurance policies across multiple phases of a claim's lifecycle (e.g., incident and loss reporting). 

And for improvement measures, an IRM offers the enterprise a comprehensive platform for corrective measure tracking and root cause analysis, allowing them to discover hidden insights for making data-driven decisions for reducing the total cost of risk (TCO).

 

New Risk Assessment and Quantification Methodologies

Accurate risk quantification allows enterprises to better evaluate identified risks and derive actionable data from those evaluations—specifically, by enabling the prioritization of risks by severity/importance. Because most organizations are limited by time and/or budget in mitigating the vast spectrum of risks across the enterprise, ERM initiatives are usually focused on mitigating the most critical risks to the business. Proper risk assessment and quantification are therefore imperative for achieving the visibility required to know which risks should be addressed first. To this end, an IRM solution helps enterprises highlight key emerging risks and dynamically prioritize the ones that may impact the enterprise most severely.

 

Prioritize Risk Mitigation

With factors like increased digitization and the massive shift to remote work creating an ever-expanding array of risk dimensions, an IRM solution can help modern enterprises tackle the complexities of this evolving risk landscape through a unified platform for viewing, understanding, and managing enterprise risk. By leveraging IRM, organizations can strategically prioritize their risk mitigation efforts to save time, stay competitive, and create more value for customers and end-users.

Visit Ventiv’s ERM software page to find out how IRM can help your enterprise streamline its ERM initiatives and how leading organizations are using the platform to understand, identify, and manage their business risks.

 

Jul 21, 2022

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