Risk Management must Cooperate with Digital Transformation - Course Monster Blog Uncategorized

Recent PwC 2022 Global Risk Management Survey results provide a window into senior leaders’ opinions on their companies’ operations. The report begins with a few well-known highlights that reflect reality:

• The speed and disruption of change are increasing.
• The labor and supply markets experienced difficulties as a result of the COVID-19 pandemic.
• The risk from geopolitical is increasing.
• The priorities of organizations are tried to focus and redirected by new regulations, including a stronger focus on risk, audit, and compliance challenges.
• The above elements put a strain on public safety issues, supply chains, and cyber dangers.

Digital transformation and risk management are more important than ever because of these issues. What, if any, differences exist between them? Despite what their names might imply, they are very closely linked.

Can You Blindly Transform Risk Management?

Simply said. The question of whether that is a wise business choice is another. As we previously mentioned, strengthening an organization requires many different puzzle pieces, but each of those puzzle pieces has a common thread: Risk assessment.

You see, a strong risk management program helps a business make decisions with objective and clarification:

• When should a business unit be a spin-off? What are the dangers to a company’s name, standing, and cash flow?
• What about a multi-year effort for digital transformation? What characteristics do we want in vendors?
• What effects will operations have? With a solution that can last for more than a few years, are we securing our future?
• To the moon by air? Do we have the resources and know-how required to do that? What partnerships will we need?

These simple examples demonstrate that there is a risk issue at the heart of every strategic problem. Additionally, as we previously saw, the organization’s risk appetite will play an important role in determining the program’s maturity and posture. It is similar to running a digital transformation strategy.

Complex Problems, Simple Solutions, and Difficult Implementations for Risk Management

A “heat score” matrix has probably been observed throughout your professional travels. They are color-coded scores that convert a qualitative evaluation into a quantitative score and are intended to help people make decisions quickly. These matrices are great resources when things are tense, such as in incident response or crisis management scenarios. However, they are less effective for strategic planning.

Complex solutions are not always necessary for complex issues. In truth, basic solutions are usually best, with the warning that implementation may be challenging and complicated. For instance, they are aware that they must go from point A to point B to solve my complex problem, but I may find it challenging to make the trip.

Keep in mind that decision-makers have the time, patience, and tolerance necessary to navigate a difficult or excessive solution. A board or C-suite may require answers to important questions like:

• Do you have the necessary resources and defenses in place?
• Do those who need permissions have them?
• Will the answer conflict with our business needs?
• How can this solution help our business grow?

Even if careful preparation calls for it, they just want to know the specifics of the trip (from point A to point B), not every rest stop along the way. The final question is: “What are the risks and investment returns if we proceed down this path of digital transformation? “Risk management and digital transformation are linked, thus we need a basic foundation to approach the challenging issue.

Bringing It All Together for Cyber Resilience

What tools do we have then for strategic planning? We already have a solid introduction. This is a summary:

1. Know your resources
2. Define your risk posture
3. Get in the right frame of mind
4. Step up to the challenge.

These processes, however simple they may seem at first glance, are complex and full of subtleties. Technical difficulties could include establishing your disaster recovery capabilities before and after a change, for instance. You might also need to decide whether to deploy 5G/edge technologies or whether artificial intelligence is a good fit for your company.

Then there are non-technical difficulties that will demand top performance from your chief information security officer. Staff members that are technical and non-technical will be required to communicate in a common language, which is almost often dollars and cents.

Apples to Apples

One of the keys to success is also commonality. You need to have trust that people are being honest with you to make wise decisions.

Some excellent industry frameworks focus on risk management and business continuity, including NIST SP 800-30, SP 800-34, and ISO 22301. Whatever framework you have implemented, there are a few conditions that must be met for it to be effective:

• Taxonomy: Has the organization as a whole received and accepted the impact categories and definitions? You have an issue if one business unit sees a risk while another does not. Definitions are important, and linguistic precision is important. It is essential to have a single pane of glass for everyone to refer to.
• Governance: Exists a formal program, even one that isn’t performing at its best? To divide ownership and enforcement, there is a systematic program. It shows that there is already some support from the top.
• Collaboration: Any attempt will fail if such teams don’t communicate with one another. For instance, the infrastructure and technology team might want to completely switch over to the cloud. However, the business team can learn how an organization cannot accept a certain business risk (say, for example, if a key selling point of the service is that nothing is cloud-based). These slight differences are the kind that can turn well-intentioned actions into potentially profitable disasters.

Useful Data to Make Informed Decisions

The idea is to have shared understandings. If there are benefits, they can be very great, and if not, there may be consequences that are plain awful. You risk irritating your staff and decision-makers by asking them to define risk. Precision and definition will stop that.

In conclusion, digital transformation is risky even if it can happen without risk management. On the other hand, if your risk management program isn’t based on transformation ideas, it can be an opportunity just waiting to be taken use of. Finally, one cannot be accomplished without the other.

Here at CourseMonster, we know how hard it may be to find the right time and funds for training. We provide effective training programs that enable you to select the training option that best meets the demands of your company.

For more information, please get in touch with one of our course advisers today or contact us at training@coursemonster.com