Why is it worth implementing a risk management system?
Implementing risk management helps companies carry out tasks more efficiently and achieve business goals more effectively. However, it turns out that not all organizations have implemented an integrated ERM system. Moreover, without proper or effective risk management, even seemingly insignificant events can have serious consequences, including leading to substantial financial losses. Unsure whether you need an ERM system? Learn about its benefits.
A comprehensive and efficient risk management system helps organizations anticipate risks and respond appropriately. The identification of events and risk assessment happen quickly enough that decisions can be made faster, either minimizing the impact of risks or entirely avoiding them.
Reasons why your company needs ERM
Let’s now move on to the reasons why it’s worth implementing a risk management system.
Unified and comprehensive approach to risk
A comprehensive ERM system allows for the unification and streamlining of processes for monitoring and managing the area of risk. At the risk level, it enables the assessment and management of various types of risks. Additionally, the system gathers and stores all information in one place, which reduces the risk of data fragmentation and the unknown complexity of their conflicts.
Global risk analysis leads to better decisions and preventive measures
Having a holistic view of the organization’s risk status is not just a matter of convenience. With an authorized risk management system that integrates various types of risks across the company, managers can better understand how different risk factors interact and potentially affect each other. This, in turn, helps make more informed decisions and choose effective risk mitigation measures that align with the organization’s goals and risk profile.
Access to always up-to-date and consistent data
The traditional approach to risk management involved chaotic and often inconsistent processes and databases, resulting in conflicting and sometimes competing risk objectives. By choosing an ERM system, processes, objectives, and data are integrated. This makes it easier for employees to control versions and updates, and to achieve objectives, while risk owners can be confident in the quality and consistency of the data related to risks.
More accurate and optimized risk information
Risk information is stored in a properly designed database, ensuring it is always consistent, accurate, and appropriately optimized. Every user of the system can generate reports at any time, review the risk history, or conduct risk assessments and evaluations. An advantage of the system is its ability to integrate with other company tools, significantly enhancing its capabilities while also aiding in making better strategic and management decisions to reduce risk within the organization.
Compliance with stringent standards
A risk management system should meet data security requirements, be properly secured, and integrated with other processes within the organization. At PBSG, we provide comprehensive support in designing and implementing ERM in accordance with international standards ISO 31000 and COSO II. This allows the organization to manage risk more effectively and improve trust among clients and partners..
Increased convenience and speed
In today’s world, organizations need access to data in real-time. An integrated tool provides companies with convenient and fast access to data, as well as its analysis. It is also possible to define new indicators and criteria, which will help improve data quality and streamline risk mitigation methods.
Enhanced data access capabilities
The risk management tool provides easy access to risk information in various configurations. For example, users can analyze historical data or create customized reports in selected ranges and areas. The software ensures on-demand data access and enables efficient business continuity recovery in cases such as power outages or security-related incidents.
Automation instead of spreadsheets
A tool integrated with the risk management methodology reduces the need for inefficient spreadsheets. One of its major advantages is the ability to personalize, meaning it can be tailored to the specific nature and needs of the organization. Processes such as review, approval, notification, and internal communication methods can be automated, enabling more efficient analysis and response to risks.
Multilingual capability
Risk management helps assess, analyze, and explain potential risks, which is crucial, especially in financial matters. Moreover, organizations are becoming increasingly multinational; employees and clients are distributed remotely across the globe, making it valuable to choose a multilingual solution. For example, the risk management system erisk is available in over 30 language versions, making it ideal for international corporate group structures as well as smaller foreign organizations.
Implementation of a risk management system – PBSG offer
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To manage risk efficiently, the right tools are needed. Until recently, many companies relied on manual procedures and tools handled by different departments and individuals within the organization. Recent technological innovations have brought more advanced (yet still easy-to-use) tools that manage this area comprehensively. By implementing integrated risk management and its automation, companies can analyze data in real time, create reports, assign responsibilities, and more. An example of such software is erisk, which we at PBSG have successfully implemented in many Polish organizations and institutions.
Check out the offer: Implementation of a risk management system.