There are inherent risks involved with any business. Issues like liability, workplace safety, and compliance are all part and parcel with running your own organization. Being able to effectively mitigate and manage those risks is what makes a business successful – and that’s why risk management is such a hot topic for so many business owners.
Years ago, companies handled risk management through GRC solutions (Governance, Risk, and Compliance). But these days, things are starting to change; instead of the old GRC standard, businesses are looking for a more modern approach for assessing and managing risk. And with this new approach comes a new name: integrated risk management.
What is Integrated Risk Management?
Integrated Risk Management, or IRM, is a set of processes and practices that help organizations handle risk from a unified viewpoint. Businesses who use IRM are aware of the inherent risks in their industry, and they seek to manage those risks and improve their decision-making and performance through innovative technologies.
IRM gives companies a holistic look at their risk levels. Instead of “separate spheres” handling risks individually (for example, legal risks vs. technology and data risks), IRM provides business owners with a complete picture. This can help them make the wisest and most informed decisions to avoid problems for all parts of the organization.
Risk Areas Addressed by Integrated Risk Management
One of the unique things about IRM is that MORE is always better. The more risk areas you address through your IRM solutions, the more complete your risk assessment will be. This allows you to be more strategic with your decision-making, which ultimately improves your business performance.
At the very least, any organization utilizing IRM should address the following areas:
Identity Risk Management (IdRM)
If a hacker manages to infiltrate your company’s network, the results can be disastrous. Data leaks, stolen identities, and compromised customer information can wreak havoc on a business – which is why it’s critical to mitigate your risk through Identity Risk Management. IdRM analyzes a company’s access risk through their digital networks. This will help you protect your network and the information stored within.
Third-Party Risk Management
We live in a world that’s becoming increasingly interconnected. Nowhere is that truer than in the business realm, where companies have long lists of contractors, vendor supply chains, and other third-party services. Third-party risk management helps you keep track of your third-party relationships and gives you the data you need to make smart choices about how those relationships affect your business.
Business Continuity Management
These days, every industry can experience “disruption,” from the hospitality world to the transportation. However, nowhere is the risk of disruption more prevalent than in the tech sector, where a new software or product could make your entire business obsolete. Business Continuity Management helps businesses identify and recover from these types of disruptions, allowing tech businesses to stay a few steps ahead of their competitors.
Corporate Compliance Management
When the European Union passed the General Data Protection Regulation (GDPR) in 2018, countless businesses across the globe found themselves scrambling to update their policies and meet this new standard. As new regulations and compliance requirements emerge, Corporate Compliance Management can help your business meet these new standards easily and seamlessly.
IT Risk Management
There was a time when the world of IT was limited to office computers. But these days, IT touches literally every element of your business, from mobile devices and social media to programming algorithms and machine learning tools. IT Risk Management allows you to clearly see the risks associated with your company’s IT department, which can help you more effectively spot vulnerabilities in your network and protect your business against them.
Integrated Risk Management vs Governance, Risk, and Compliance
As you can see, IRM helps your business assess risks and make decisions that help your organization grow. But you might be wondering: how is that any different from GRC? After all, the old system also helped mitigate risk – it’s right there in the name! What is the real difference between these two practices?
Simply put, GRC focuses primarily on compliance-driven mandates. GRC is concerned with whether your company complies with current industry and government regulations, not necessarily the everyday risks associated with running your business. In contrast, IRM offers you more complete data on your business’s risk, and it provides you with the insights you need to make better business decisions.
Why Your Company Needs an Integrated Risk Management Program
The business world today moves very fast, with new technology, new regulations, and new strategies popping up all the time, If you don’t have an IRM program, your business will inevitably get left behind in the dust – and you might end up with a few PR nightmares on your hands in the process!
To learn more about IRM programs and to see how they can change your business for the better, contact ComplianceLine today.