Risk management can take a great deal of time, effort and resources, especially when auditing processes are inefficient. Fortunately, business process optimization—an approach more commonly tied to productivity—can reduce the complexity and manual requirements of risk management so that it’s more efficient and effective.
Companies are optimizing risk processes by using advanced analytics, robotic process automation (RPA), enhanced ERP controls and automated governance solutions. These technologies drive more effective and scalable risk management. They also free up risk professionals to focus on high-priority issues.
Are you ready for a change and need some talking points? Ask your leadership team these four questions to determine if technology can help with business process optimization in the risk function at your organization.
1. How do we ensure our risk management strategy is aligned with our strategic goals?
Being able to moderate risk tolerance based on strategic goals can improve agility, but it requires resources. When was the last time you assessed your risk management strategy? This might not have been a priority in recent years because of the pandemic—or you may not have enough people or data to execute regular assessments. But regular assessments are important to ensure your risk management strategy stays aligned with your growth strategy.
Automation can fill this gap by fueling always-on enterprise-wide visibility and access to tools for analyzing, prioritizing and monitoring risks, controls and compliance. In such a framework, assessing any aspect of risk is faster and easier, and changes can be made throughout the system from a single point of control rather than having to update separate workspaces.
2. Are we consistently measuring the efficiency and effectiveness of our risk management processes?
Knowing how your organization compares with industry benchmarks can confirm whether compliance costs and performance indicate the need for improvement. While automation helps on both these counts, you also need process data from business process optimization to help make this comparison and mine for process improvement opportunities.
Data analytics plays a key role here because it not only helps simplify compliance and control processes, but it also enables insights into their effectiveness. You can also use data analytics to identify new and emerging risks for which no controls have been established.
3. Could we use co-sourced services to cut compliance costs and improve performance?
Cloud-delivered services, such as RSM’s Sarbanes-Oxley compliance offering, can improve productivity and mitigate risk, while enhancing collaboration, automation and insight into your organization.
eGRC, a software that facilitates governance, risk and compliance activities, is another solution organizations can use to reduce compliance costs. A growing number of organizations are using eGRC solutions because they help optimize collaboration and automate processes across the three lines of defense: compliance, enterprise risk management and internal audit. Note: Link to eGRC article.
4. How are we going to securely scale our risk management framework as we grow?
RPA can replace many manual processes that support risk management. Software robots (aka “bots”) can perform structured, repeatable and logic-based tasks by mimicking the actions taken by existing human staff.
RPA can manage many routine tasks, such as population selection, testing and quality control. It can also help leaders identify unusual transactions that may require further analysis or investigation. Automating these tasks helps organizations manage audit and compliance costs scale as they grow. RSM can help you implement RPA to help your audit and compliance organization become more efficient, as well as assess and improve your organization’s use of bots.
A better path forward
Organizations often view risk management as a necessary evil due to traditional labor-intensive approaches. But it’s actually a critical part of your overall business strategy. Noncompliance or missed warning signs can have a negative impact on growth goals, profits and reputation. Assessing risk is a crucial step in turning due diligence investigations into growth opportunities.
Business process optimization provides a better path forward by automating many functions, including data analytics and predictive modeling. With the smart use of automation, you can transform your internal audit, compliance and risk management programs to maximize value.
