Enterprise Risk Management Creates Value

Organisations now realize the value of integrating risk management with other business functions. Long seen as a function of compliance, risk management is now seen as a value-creating activity.

Enterprise risk management (ERM) helps identify leaks in your system’s pipes. Plugging these leaks will result in greater efficiency. Systemic risk identification will detect areas of upstream and downstream dependencies throughout your organization, such as when one area of the organization is unknowingly causing strain on other areas.  Additionally, this method could also identify areas that would benefit from centralized controls so the extra work of maintaining separate activity level controls is eliminated, increasing organizational efficiency. The number of systemic risks identified is a key value added to the business by risk management.

A business is the sum of its parts. A risk event in one functional area also affects other functional areas within the business. While risk managers own the completeness, timeliness, and accuracy of the risk information process owners own the risk itself.  Greater involvement of process owners in risk assessments means more accurate and forward-looking information. The percentage of process areas involved in risk management is another key indicator and value added by ERM to the organization.

Many organizations do not understand how risk affects the business measures that they monitor daily. When a risk or activity changes, organizations have no way of knowing how these changes will affect their metrics. Through risk assessments and linking risks to activities, organizations can pinpoint activities that need to be monitored thus identifying emerging risks before they materialize.

As the complexity of business operations increases, more and more companies are using company-wide Enterprise Risk Management software. Such software enables the organization to manage risks, minimize wastage and maximize the use of resources.

When choosing ERM software, one of the key features to consider is whether the package promotes transparency in data collection, analysis and measurement. Secondly, the software should provide you with clear and simple accountabilities enabling you to pin point not only the problem but the source of the problem as well while ensuring broadest coverage of risks within your enterprise. The product should be built according to the exacting industry standards and should have no conformance issues, technical or otherwise. It is, of course, assumed that the software comes with excellent and cost-effective after sales support.

Enterprise Scorecard is an integrated management software solution designed to support risk management activities within the enterprise. It is essentially a web-based program which gathers information from various people and computer systems around your business; allowing you to keep detailed records of all their activities; and to route that data between various administrators who take actions and make decisions. You can use it for self-service document creation and storage; and also you can use it to push requests for information out to users via their email. It has a very powerful reporting capability, and you can either view dashboards and reports on-line to see information that is relevant to you, or else we can push that data out in richly formatted documents via email to the relevant decision makers in your business.