How risk can create the 360 degree company view
By James Francis, first published on ITWeb.
It’s often said that companies today are dying at a startling rate. This is true: according to an analysis of 70 years of company data, the Boston Consulting Group found that today’s average listed US company only lives for 30 years, down from 45 years in 1985. On average, one in every ten publicly listed companies meet their end each year through mergers, acquisitions and bankruptcy.
This appears to paint a terrifying picture. But the truth is more nuanced than that. Companies certainly face much greater risk than before, but this is because they also have far more opportunity in front of them. Business isn’t failing – it is thriving! But only for those companies who are able to see the forest for the trees.
How can that be accomplished? The simple answer is to expand and unify business intelligence, says Sean Pyott, MD of Thryve: “Companies today can be tenfold as informed about what is happening inside and around them. Modern cloud systems have caused a massive drop in the price of these services and there is almost no CAPEX spend anymore. At the same time they are incredibly capable of gathering and presenting the various intelligence sources companies rely on. This is the crux of what many call ‘digital transformation’: modern technology tools, combined with tried-and-tested business practice, are changing gears on companies everywhere.”
Making data work for you
Establishing those tools requires data, which leads to insight. This is perhaps the leading reason why most companies fail to board the 21st century commerce train. They may have all the data, but they can’t seem to bring it in line with their vision. A lot of money and time is being spent attacking this problem, yet with mixed results.
But what about risk as the catalyst for this transformation? Think of the characteristics of determining risk: you need data to scrutinise, processes to compare, people to evaluate, goals to benchmark and vision to adhere to. These are also the quintessential ingredients of a successful company.
Risk is both negative and positive. If you decide to start a transformative exercise regime, you go to a doctor for a check-up. Your GP evaluates the risk, including what you should do to accomplish your goals – such as what to eat. Knowing risk is good.
“We have been servicing the risk management market for a long time, and something has changed. Risk used to be the orphan business conversation, because businesses too often treat it as a due diligence exercise that begrudgingly leads to an annual report. Modern data culture has started to shift that. Good risk management is about intelligence gathering and new cloud-based risk platforms are really good at that task. Risk is becoming more about opportunity and predicting potential, because the quality and frequency of insight is unparalleled,” says Pyott.
If you can automate the processes behind risk-gathering activities, you inadvertently create the ground for a complete strategic view of the business. By using modern cloud platforms, integrated with your business applications, the data collected for risk purposes can easily be brought into play anywhere else.
Cloud + risk = business intelligence
A real-time view of the business from any vantage – for the CEO, the Chief Risk Officer, the finance guys, even procurement – becomes entirely feasible and customisable. Best of all, the same technology bedrock that enables this kind of platform to operate can be expanded to serve all avenues of the company.
Sales and marketing teams can collaborate over the same datasets as those being used for risk analysis. The data does not need to be segmented and siloed. It can simply be presented appropriately to the right parties. While silos do make sense in organisations, there is no reason why the underlying flow of information needs to be impeded. In fact, that communal flow is the very nuance of transformation that many companies fail to grasp.
Are we saying you can have your cake and eat it? Yes, absolutely. By focusing on risk management platforms that use modern cloud-based delivery and integration with on-premises assets, you can unleash the gulf stream of data that will take your organisation into the future.
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