More With Less: Managing Risks With Limited Resources

With risk teams often facing resource constraints, digitizing the risk management process is a great way to improve efficiency. Not only does this save resources, but it improves risk managers’ ability to focus on the insights and actions that matter.

Hands up if your bank’s Chief Risk Officer (or the equivalent role responsible for risk management) says they have more resources than they know what to do with. Any takers? In most cases CROs face demands from multiple stakeholders, both internal and external, and need to be master jugglers.

Perhaps risk training keeps getting pushed out, resulting in inappropriate risks being taken or shortcuts taken. Perhaps a focus on credit risk or monitoring regulatory change takes up most of their time, resulting in enterprise or operational risks to the bank or their communities being overlooked. Sometimes those teams are small, and additional headcount may not be an option.

A key challenge for those responsible for risk functions is how to get the most from the resources they have. How do you collect the information you need? How do you leverage the risk information you have to gain insights and enable timely and risk-informed decisions?

The biggest leap that we see financial services providers take in improving efficiency is moving from manual risk management processes, such as Excel and Word, to digitizing their risk and compliance management. Some of the more immediate pain points that this solves are:

• Laborious data collection, including manual following up

• Copying data into multiple locations

• Re-creating or transforming data

• Pulling together disparate information into reports; sometimes multiple times for different audiences

• Automated processes to drive regular risk, compliance and assurance reviews

Digitizing isn’t only about making things more efficient; it also makes them more effective. “So what?” is a question that Boards, CEOs, executives and CROs should keep in mind when presented with risk and compliance data. In the absence of the ability to probe the data, risk reports can become a sea of information “just in case someone asks”. The potential downside of these large reports is that the important information gets lost.

Digitizing risk and compliance management can help address the “so what?” question. Benefits include:

• Visualizing data and turning it into insights

• Automatically aggregating data from different areas to provide an enterprise view of risk

• Showing the history of changes in your data, enabling identification of trends, rather than simple ‘point in time’ information

• Providing live data that can support decisions in real time

Of these benefits, perhaps the biggest is the ability to visualize your data. Interactive dashboards can provide immediate insights on the fly – jumping from the eagle eye view into the details as needed to highlight key drivers of risk and performance, actions being taken to address any weaknesses, and ultimately focusing on what matters at the time decisions are made.

Taking away the ‘busywork’ of risk management enables risk professionals to focus on what really matters: providing insights and supporting decision makers to achieve the objectives of the bank and their community. It allows you to shift the balance from ‘doing risk management’ to effectively managing risks.

To find out more about how digitizing risk management can benefit your bank, watch Protecht’s free-on demand webinar with GRC expert Michael Rasmussen joining our North America VP Terence Lee on Using Visual Analytics for Better Risk Management. Register now to view the recording.