Risk management is a critical process that companies of all sizes — from small startups to large multinational corporations — need to prioritize. The risks your organization faces can have a significant impact on your bottom line. That’s why it’s essential to have effective risk management strategies and tools in place, including risk management software.
Companies are increasingly acknowledging the need to share accountability with first-line business process owners, in developing an integrated and agile approach to risk management. They understand that the benefits of risk management software are seen by the entire business if risk awareness is embedded in the front lines.
However, unless there is a deeply embedded risk culture, they may not even be aware that they hold critical intelligence as they go about their daily operations.
5 key benefits of risk management software
The benefits of risk management software go far beyond helping businesses identify, assess, and manage risks. Here are the top five benefits of risk management software for you to consider:
1. Improved efficiency
The first added benefit of risk management software is that it automates time-consuming tasks and streamlines processes, making it easier for teams to collaborate, communicate, and track progress. This reduces the administrative burden on employees, freeing up time to focus on other important tasks. Risk management software can also reduce duplication, and provide real-time data and analytics, enabling organizations to make informed decisions and take action quickly.
2. Enhanced risk identification
Effective risk management requires organizations to make informed decisions based on the risks they face. However, this can be challenging if the company lacks accurate and up-to-date information about potential risks.
Tools like loss-intake portals, confidential reporting, and easy-to-use continuous risk assessments add to the benefits of risk management software as they can help first-line users to identify risks and document controls in real-time. The use of integrated GRC technology helps cut through silos by merging data from different business units into one unified central repository. This central matrix of risks-controls-regulatory requirements can enhance the visibility of risk teams and help them work with a full hand of information.
3. Better viewing through reporting and dashboards
With real-time dashboards and reports, risk management software provides a complete view of your organization’s risk landscape. From risk committee to compliance and audit committee dashboards, reports covering critical data on aggregated risks, residual risk scores, the dollar value of net loss events and its severity, as well as compliance levels by regulator and key risk indicator (KRI) ratings by business units can help risk leaders prioritize resources and strengthen controls in high-risk areas of the business.
Doing so allows leadership teams to make well-informed decisions that impact the entire organization which, in turn, promotes a more transparent, risk-aware, culture.
This further adds to the benefits of risk management software, as it can also simulate different scenarios to evaluate potential outcomes and assess the impact of your risk mitigation strategies. These reports can be customized to suit your company’s specific needs and can be easily exported or accessed from anywhere, making it easier for leadership teams to act quickly in response to emerging risks.
4. Improved compliance testing efficiency through regulatory change management
Compliance is a critical aspect of risk management, especially for businesses operating in highly regulated industries. Considering the fact that regulatory requirements can be complex and time-consuming, it can be challenging for businesses to keep up with changes.
One of the biggest benefits of risk management software includes built-in compliance management features that help organizations stay up-to-date with regulations and industry standards. It gives you the option to automate compliance assessments and track progress.
Risk management software can help organizations to comply with these requirements by providing a framework for reporting and tracking risk management activities. This can help avoid costly fines and penalties, and ensure that they’re meeting their legal obligations.
5. Cost savings
Many organizations face the challenge of not having risk data consolidated, analyzed, and reported in an automated fashion which thereby reduces the time and costs associated with the assessments and reporting process. By reducing manual effort and improving efficiency, risk management software can help organizations save money in the long run. When considering the benefits of risk management software, it’s important to note that it’s scalable and can grow with your organization, so you can continue to realize cost savings as you expand.
What to consider in your risk management software
Risk management software is best when implemented in a risk-aware culture. Essentially, this is an environment where employees at all levels are conscious of potential risks and are encouraged to proactively identify and mitigate them. With effective risk management software, employees are aware of risks and actively identify and report them, meaning they’re more likely to provide accurate and timely data that can be used to inform risk management decisions.
A risk-aware culture is an environment where employees at all levels are conscious of potential risks and are encouraged to proactively identify and mitigate them.
In this setting, observed risks are identified and reported in real-time — especially when the company’s risk management software gives them the option to do so discreetly and anonymously. By giving each individual across the company the chance to feel accountable, the organization is able to be one step ahead of emerging risks, near misses, and loss events.
Though implementing a risk-aware culture is an important start to reaping the benefits of risk management software, there are also some features to consider before investing. These include:
- Learning curve: Risk management software is often complex and, depending on your employees, could require a learning curve for staff who are not familiar with the software or risk management processes. This can lead to delays in implementation and even errors during use. However, as long as risk leaders are confident in their abilities, this can be overcome with in-depth training.
- Technical issues: Though one of the benefits of risk management software is the ability to automate processes, there’s always the potential for technical issues to arise. This can include software bugs, compatibility issues, and downtime. The customer support team from the risk management software you choose can effectively mitigate technical issues should they arise.
- Limited customization: While risk management software provides a comprehensive platform for managing risks, some may not be fully customizable to your organization’s unique needs. This can lead to limitations in terms of functionality, reporting, and analytics. There are others, however, that allow you to fully customize your platform, ensuring it meets your company’s needs. The key is determining which benefits of risk management software they provide.
- Data security concerns: One of the most integral benefits of risk management software is the fact that it often securely deals with sensitive data such as financial information. However, there always can be concerns around data security. Organizations must ensure that the software they use has robust security features, such as encryption and multi-factor authentication.
While there are some areas of improvement, the benefits of risk management software generally outweigh the drawbacks. It’s important for organizations to carefully evaluate their needs and consider the potential drawbacks. That way, they can make informed decisions and ensure that they’re getting the most value from their investment in risk management software.
Resolver: The 6th benefit of risk management software
Resolver’s risk management software can help your organization manage risks more effectively, improve efficiency, enhance collaboration, ensure compliance with regulatory requirements, and make better decisions. When it comes to the benefits of risk management software, Resolver can reduce the impact of risks.
With Resolver’s risk management software, you can automate risk assessments, issue tracking, and reporting, saving your team valuable time and allowing them to focus on high-priority tasks. Ready to take your risk management to the next level? Book a demo or sign up for a showcase today.