How do you manage the uncertainty of what has not happened yet?
That’s where enterprise risk management software (ERM Software) also known as operational risk management software comes in. It tracks the emerging risks and changes to existing risks across the enterprise and connects these changes to the activities and business metrics that run the business. A change in risk at the business process level, demands a change in the operating procedures to prevent this risk from materializing or seize an opportunity.
The next time someone in your organization, has doubts about needing enterprise risk management software to effectively manage risk, consider these 5 universal truths:
- Content: Risk assessment templates, risk identification root cause libraries – ERM software comes with all the templates, standards, and libraries you need, on day one. ERM programs need this content before they can have an ERM program. Spending months developing this content and the time wasted of all those around the organization as well as the missed risks and opportunities. A change in risk at the business process level, demands a change in the operating procedures to prevent this risk from materializing or seize an opportunity.
- All in one Place: Timely decision making - this requires governance over the complex and time consuming activity of organizing and grouping information across silos and levels. With ERM software, all of your risk management activities are all in one place, so the process of rolling up and grouping information is automated to just a click of a button.
- ERM Reports: Accurate but easy to interpret views for your board – Since it is so hard to roll up information using spreadsheets, risk managers typically have to choose between presenting accurate but far too granular information, or high-level but less accurate assumptions to the board. ERM software eliminates this choice, as accurate risk information directly from the process owners is easily rolled up into holistic views of the enterprise. All of the information, metrics, and reporting tools are available right at your finger-tips, so senior management can make strategic decisions before goals are impacted based on reliable risk data aggregated from the process owners.
- Business Intelligence Tools with a forward looking perspective – spreadsheets, by nature, can only manage risk from a historical perspective; aka identify risks that have already happened. While this is important, what about the risks that your organization is susceptible to, but has been fortunate enough to avoid so far? ERM software provides the structure to prioritize and manage risk from a historical and forward looking perspective with capabilities to identify emerging and systemic risks and track trends over time.
- Linking risk to performance management – spreadsheets simply lack the ability to tie risks to goals and success measures. Only a robust taxonomy within ERM software is able to manage the complex relationships and interdependencies between root-cause risks, business activities, and the strategic goals they impact.
Typically an organization starts their ERM journey from either a top-down strategic or bottom-up governance approach and then evolves to cover their entire enterprise. Click here to watch the video that best represents your current ERM challenge.