Global Minefield: Effectively Navigating Enterprise Risk Management

OVERLAND PARK, KS–(Marketwired – June 17, 2015) – A recent article in SF Magazine titled Nonstop Risk reviewed several studies and reports to provide a glimpse into the complexity of today’s risk management landscape. What it found was the current global marketplace is comparable to an intricate minefield of hair-triggered risks. However, for many organizations, treading lightly is not an option. Companies must dive head first and engage in a game of Minesweeper to remain competitive.

One survey found the biggest concern for business leaders in 2015 surrounded external risks. Forty-six percent of respondents indicated that business interruption and supply chain risk were their top concerns. Globalization of business processes is a key component to this finding. With suppliers, distributors, and production facilities now being spread out across the map, companies must account for the corresponding risks (political, geographic/national, regulatory change, etc.) involved.

Domestic and international governing bodies are reacting accordingly through legislation and regulatory standards for enterprise risk management. As standards and regulations continue to evolve, companies will be strained to keep up.

A survey by the ERM Initiative at North Carolina State University and the American Institute of Certified Public Accountants in February 2015 alluded to this by reporting that 43 percent of responding companies indicated no structured process for identifying and reporting top risks to their board. Another 27 percent responded that their processes for risk management were disorganized and informal. While these numbers show the current reality of the situation, other research shows great concern exists regarding the ability for companies to adequately govern and manage this evolving, global risk landscape in the future.

To effectively manage and mitigate the associated risks of global business, risk professionals must rely on a constant stream of incoming data. However, efforts to maneuver a company through an ever-changing risk minefield are futile without means of aggregating and correlating this ingested data. Traditionally, larger companies employ the help of risk management teams; however, smaller companies may not have the luxury.

Best practices and regulatory policies advise the issuing of risk assessments to supply chain entities, utilizing third-party risk management programs, integrated processes for tasking and governing said programs, and methods for risk prioritization. Regardless of resources available, this can be quite the undertaking for any sized company.

What has long been a nightmarish undertaking of insurmountable proportions, managing vendors in the supply chain can now be an automated, streamlined process. Today’s governance, risk management and compliance software solutions (GRC for short) remove the manual tasks and reduce the number of necessary resources. Now organizations can automate things such as risk and security assessments, scheduled reviews and assessment updates, as well as risk rankings based on assessment feedback. These solutions can tackle both the quantitative and qualitative tasks associated with risk measurement. A robust GRC tool like LockPath’s Keylight can effectively identify and document risks, assign a value to each, and prioritize identified risks by appointed values or predetermined business impact. All of these functions combine to provide an in-depth view of enterprise-wide risk analysis, with the end benefit being governed, strategic risk mitigation.

What this means for organizations is a clear, strategic plan of attack for risk management based on hard data. Companies who utilize such a solution will gain a comprehensive understanding of their global risk landscape and reap the benefits. Ultimately this provides the opportunity to not only remain competitive, but also effectively navigate the minefield that is global enterprise risk management.

About LockPath

LockPath is a market leader in corporate governance, risk management, regulatory compliance (GRC) and information security (InfoSec) software. The company’s flexible, scalable and fully integrated suite of applications is used by organizations to automate business processes, reduce enterprise risk and demonstrate regulatory compliance to achieve audit-ready status. LockPath serves a client base of global organizations ranging from small and midsize companies to Fortune 10 enterprises in more than 15 industries. The company is headquartered in Overland Park, Kansas.

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