Risk Management & IT: A Marriage Made in Heaven

Remember that you heard it here first: The eventual combination of formal risk management with technology driven disciplines will revolutionise the way businesses realise genuine enterprise risk management - the holy grail of the risk professional and a key enabler of boardroom and executive decision making.

Although risk management is still a relatively immature discipline in most organisations, the development of risk management is assured through internal teams and external advisors. But what happens when risk management processes become 'mature' in an organisation?

The simple truth is that no matter what the area of expertise or professional discipline, at a certain stage of its development - it will become a silo. Executives in all areas become confident in their teams, their processes, their reporting. They will tell you that they are doing their bit. They go to conferences and learn from peers, swapping war stories and methodologies on how to improve their corner of the company - and there is nothing wrong with this.

The trick though is connecting specific areas together and ensuring that they form a consolidated enterprise.

Now, of all the areas of process management in a business, risk management offers one of the most profoundly information-rich sources of critical data, giving clues to overall corporate performance. This effects not just the risk profile but the culture, the thinking, the reporting regimes, cost of business, speed to market, the hierarchical structure; even the effectiveness of individual line managers.

Truly integrated risk management will not simply identify and mitigate the dangers to corporate health and well-being. It will impact the very quality of corporate decision making, save costs, and drive positive change.

So, true risk management requires that the business avoid the 'risk silo'. But how?

Step by step, from a thousand foot view, here it is:

1. Start by constructing your enterprise risk management programme and see it through to maturity.
2. Then automate that programme using appropriate software toolkits
3. From there consider the data you are creating, the database that the information resides on, and then ask yourself this:

"How do I use this data to add value back into our corporate objectives, our bottom line, our decision making?"

In our business, we are engaging in increasing numbers of conversations which focus on the integration of risk software into business intelligence applications, banking software, HR software and the like. By integrating these systems, it is possible to create a much larger roll-up of meaningful data and information - regardless of its source - and distribute it through line management, the executive and up to the board in formats which are meaningful to each audience.

Most critically, it is about connecting the divisions of a business with common data, recognising common risk and common opportunity.

We all know that the information a risk manager possesses is of huge importance, but when placed in this context - how much more critical might that data be to overall corporate performance?

Aarron Spinley is a member of the Risk Management Institute of Australasia, and the NZ Society for Risk Management. Datasouth Corporate Services provides both risk and technology advisory services on both sides of the Tasman.

NBR Article: Local bodies need risk management booster

The following is courtesy of the National Business Review (NBR) and relates to the local government risk management survey conducted by Datasouth Corporate Services.

Risk management practices at local government level have slumped to the point where they are now labelled an indictment on the sector, according to a new survey.

While 67% of councils had a formal risk management policy, more than half rated their strategy "average" or "below" average, according to a poll of 26 councils by Christchurch-based consultancy firm Datasouth Corporate Services.

Alarmingly, only a third of councils with risk management plans reviewed them only as required and had no formal periodic review period...

The full article can be viewed and downloaded here or in the February 16th issue of NBR.

IFRS & The Information Challenge

With the implementation of IFRS standards in Australia and New Zealand, organisations will have to take a look at how their information systems support compliance. This is more than simply ensuring the accounting software is up to the task. Click here to download a PDF version of this article.

BCM Roundtable Discussion

A roundtable discussion on business continuity management within government agencies was recently sponsored by Datasouth Corporate Services and MIS New Zealand. A number of CIOs and CTOs from the public sector were present to share their stories - from real and simulated incidents - that have tested their business continuity plans. A review of this discussion is featured in the June edition of MIS Magazine and has been included here with the kind permission of MIS New Zealand - to read more, a PDF version of the article is available here.

Records Management - Sick Of The Hype?

In this compliance era where we are bombarded with commentary on the importance of building records management systems, confusion abounds as vendors tout their products. Datasouth Corporate Services offers a little direction and challenges the shortcomings in the typical approach. Click here to download a PDF version of this article.

Intelligent Business?

With many organisations still not viewing information as a true organisational asset, opportunities for fully exploiting the investment in technology continue to be missed. Datasouth Corporate Services offers a little direction in the approach to a BI initiative. Click here to download a PDF version of this article.

ETA Considerations

As provisions in recent legislation allow for the utilisation of electronic technologies to replace traditional resources, much of the discussion within this area is driven from a regulatory perspective. Datasouth Corporate Services offers a little direction on the Electronic Transactions Act and its implications for organisations using technology to store records. A PDF version of this article can be downloaded by clicking here.