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At Resolver, we’re fans of Michael Rasmussen’s analogy of the Winchester Mystery House of GRC as a means of demonstrating the inconsistent building and common lack of blueprints for many GRC programs. We also relate to Rasmussen’s passion for aligning risk programs across disciplines to develop a culture that believes risk is interconnected. Therefore, GRC needs to be collaborative — and supported by a well-thought-out architecture — to deliver meaningful business value reliably.
In this article, we’ll explain the importance of a GRC strategy that focuses on efficiency, resilience, and agility. We’ll also outline key GRC benefits that can help you build an effective business case for modernizing GRC programs in your organization.
Why is GRC needed?
GRC benefits any business case because it helps organizations to mitigate risks, maintain compliance, and operate more efficiently, which in turn can lead to increased profitability and sustainability. When building a business case for your GRC initiatives, it’s important to speak to the risks that come with ignoring GRC as a means of reliably delivering objectives for the organization as a whole.
Regulatory compliance: Compliance with laws, regulations, and industry standards is crucial for businesses to avoid legal and financial penalties. GRC benefits by helping organizations identify, assess, and manage regulatory risks and ensure that their operations and practices are aligned with legal requirements.
Risk management: GRC helps organizations identify, assess, and manage risks that may impact their operations, finances, reputation, and stakeholders. By implementing risk management strategies, organizations can mitigate the impact of potential risks and protect their assets.
Governance: This refers to the processes and structures that define how organizations make decisions, allocate resources, and manage operations. GRC provides a framework for effective governance by establishing clear lines of responsibility, accountability, and oversight.
Competitive advantage: Adopting GRC best practices can help organizations enhance their reputation, build trust with stakeholders, and differentiate themselves from competitors. By demonstrating a commitment to ethical and compliant business practices, organizations can attract and retain customers, employees, and investors.
How to communicate GRC benefits into business value
As risk becomes more complex, effectively articulating GRC business value to get buy-in for GRC modernization will be critical to success. Unlock support and funding by clearly tying risk to objectives and proving risk teams to be data-driven influencers of strategy with the ability to reliably achieve objectives.
Organizations need to see the intricate relationships of objectives, risks, obligations, commitments, and controls across the enterprise, says GRC 20/20 Research’s Michael Rasmussen. “It requires complete visibility and intelligence of risk in the context of objectives.”
For leaders looking to revamp a program and maximize GRC benefits, how can they speak to the business impact and value of such an effort to get executive buy-in?
In a webinar with Resolver on GRC trends, GRC 20/20 Research’s Michael Rasmussen explained that any GRC business case or strategy starts with a clear and compelling mission and vision statement that articulates what you’re “trying to do in driving a new risk or GRC strategy forward.” Rasmussen says that whether you call it ERM, IRM, or GRC, his personal preference is always to take it back to that OCEG definition of GRC: “The capability to help the organization reliably achieve objectives, address uncertainty, and act with integrity.”
“At the end of the day, risk management functions are there to help the business to achieve its objectives. And those objectives can be corporate performance or financial objectives. They can be ESG-related objectives or on values and themes; there can be so many areas of objectives,” Rasmussen explains.
Turning GRC benefits into a business case
Effective GRC processes are crucial for organizations to mitigate risks, ensure compliance, and maintain good governance. However, implementing a GRC strategy requires significant investment in terms of time, resources, and budget. To justify this investment, organizations need to:
- Understand the current state of their GRC programs
- Design the ideal future state of their GRC approach
- Measure and communicate the value of their ideal GRC strategy
Understand the current state of your GRC programs
Rasmussen emphasizes the importance of assessing the current state of your GRC processes to identify areas for improvement and ensure that your efforts are focused on the most critical risks and compliance requirements. “What is being done today and assess what is working, what is not, and what is missing. Inquire on the functions, processes, roles, and technologies that have a stake in the area of GRC you are addressing.”
Overall, assessing your GRC processes is essential for unlocking the full benefits of GRC. By understanding your current state, you can assess your organization’s strengths and weaknesses, identify gaps in your processes and controls, and develop a roadmap for improvement. This approach can help you to prioritize your efforts, optimize your resources, and enhance the efficiency and effectiveness of your GRC processes, ultimately leading to better business value and outcomes.
Design the future state of your GRC approach
Designing the future state of your GRC approach is a critical step in enhancing the business value and efficiency of your GRC processes. “Assessing the gap between your current and future state delivers the foundation for building your business case,” says Rasmussen.
He also advises that achieving a successful GRC transformation requires organizations to adopt a strategic and holistic approach that aligns with their overall business objectives. This includes:
- Identifying and prioritizing the key risks and compliance requirements
- Establishing clear roles and responsibilities
- Leveraging technology to automate and streamline processes
- Fostering a culture of risk awareness and accountability
By taking these steps, organizations can optimize their GRC approach, reduce costs and resource demands, and improve their ability to mitigate risks and comply with regulations.
Measure and communicate the value of your ideal GRC strategy
In order to maximize GRC benefits, it’s crucial to measure the efficiency gains that a successful strategy brings. One way to measure the value of a GRC strategy is to quantify the efficiency gains it brings. This can be achieved by tracking metrics such as the reduction in the time and effort required to perform GRC activities, the number of incidents and compliance violations detected and prevented, and the cost savings achieved through streamlined processes.
Another way to communicate the GRC strategy is to demonstrate its impact on the organization’s overall performance. This can be achieved by showing how GRC processes contribute to the achievement of key business objectives such as revenue growth, customer satisfaction, and employee retention. “Measure the value the organization will achieve by working towards an integrated and collaborative view of GRC,” Rasmussen suggests. “This is the measurement of the objective/quantified and subjective/qualified value between the current and future state.”
Ultimately, to ensure the success and sustainability of a GRC strategy, organizations need to ensure that its value is communicated to all stakeholders, including executives, employees, and external partners. By doing so, they can build a culture of compliance and risk awareness, foster trust and credibility, and gain a competitive advantage in the marketplace. By focusing on GRC benefits and effectively communicating them, you can ensure that your GRC strategy is successful and impactful.
How GRC software helps deliver GRC benefits
“You need to make sure you have the right platform that can deliver on that future state you’re building towards,” Rasmussen recommends. An end-to-end GRC software solution can help build a business case for the modernization of your GRC program by:
- Centralizing activities that demonstrate how GRC benefits your organization
- Improving risk management
- Enhancing compliance with the assistance of AI-powered libraries and RegTech
- Streamlining governance processes.
Holistic GRC software, like Resolver, can also provide metrics and data to measure the impact of GRC benefits on the organization, such as reducing costs, increasing efficiency, and improving decision-making. By highlighting these benefits, Resolver’s GRC software can show how modernizing the GRC program can lead to a stronger, more resilient, and successful organization.
Resolver’s risk intelligence platform provides customizable dashboards and reporting capabilities that allow users to effectively visualize and communicate risk information. Track and manage compliance with regulatory requirement notifications, including real-time change monitoring and identifying compliance gaps.
While GRC technology can transform your team’s ability to deliver true risk intelligence to your organization, it’s just one part of a holistic strategy that highlights how GRC benefits your organization. From the desire to move towards digital transformation and GRC agility, we’ve designed a Strategic GRC Capabilities Report to help start the conversation on improving and maturing your GRC processes and strategy. Our expert panel will guide you through thought-starters and actionable goals to help maximize your team’s efficiency, agility, and resiliency in 2023 and beyond.