The digital transformation era is now, and it is transforming how we thrive. The pandemic has accelerated organizations’ digital adoption, putting significant demand on digital channels and processes.
To reduce growing threats, stay compliant, and enable flexible and proactive decision-making to support business objectives, companies must adjust their governance, risk, and compliance (GRC) processes and capabilities as new risks emerge. It is critical to adopt GRC automation as a business standard, as it will offer much-needed efficiency to governance, risk, and compliance tasks.
Companies that have digitally transformed their GRC operations have improved their decision-making capabilities while lowering costs. The benefits of a governance, risk and compliance strategy are many and it is crucial in determining operational inefficiencies.
To create new growth avenues, a business’s adaptability to new digital technologies is important. As businesses embrace digital transformation, the scope of risks that fall under GRC’s control expands substantially. As new and emerging risks are increasing in its number, organizations face a lot of uncertainty in the work-a-day business world.
To manage risks, save costs, and enhance productivity, businesses must transform existing GRC operations. They must also establish an integrated risk management vision and strategy to make coherent decisions and mitigate emerging threats.
Risk aversion and potential costs are reduced with a regulatory compliance strategy. It must be communicated with all key stakeholders for them to engage in the process. To address data breaches and respond to new regulatory and changing consumer expectations, organisations must rethink, remodel, and re-architect their existing GRC programmes and install advanced GRC solutions.
Digital Transformation: Where are we now?
Many companies have accelerated their digitalization efforts in recent years. The coronavirus epidemic and a shift to virtual work, training, shopping, and networking are two major aspects.
Digitalization brings with it many opportunities and risks, however. The risks associated with digital transformation should be carefully monitored. As an example, cyber-attacks may threaten your business, or your reliance on IT tools may expose you to risks such as suppliers who don’t match your digital standards, such as data privacy.
Managing digital transformation risks is crucial. The issue of governance must be taken seriously.
Change is inherent in all business initiatives. To maximise the benefits of a digital transformation strategy, good governance, proactive risk management, and adherence to internal and external regulatory requirements are needed.
People, Processes, and Technology are all impacted by changes throughout a digital transformation program. Managing new technology change can be difficult, but people’s resistance to organisational change throughout a transformation project is sometimes underestimated. All these issues must be appropriately managed.
After a digital transformation project has been completed, proper risk and compliance management are imperative to identify and manage the risks related to enabling technologies that could negatively affect the success of the digitally transformed organization as well as ensuring it complies with internal and external compliance requirements.
No doubt emerging technologies can offer great benefits, but they also come with new compliance and risk considerations that must be effectively managed. The appropriate management of the risks associated with any new technology is essential to the successful adoption and operation of that technology.
Governance, risk and compliance program can optimize and secure an organization’s investments in new enabling technologies through and after a digital transformation project.
GRC solutions focused on Issue, Security, Project Risk and Compliance Management are a few of the certain choices to strengthen digital transformation initiatives. With the new technological advances that enable the digital transformation, GRC technology solutions can aid in streamlining proper and credible Corporate Governance, Performance Management, Risk Management, Vulnerability Management, Incident Management and Compliance Management.
It is crucial to monitor and manage new technology risks and compliance requirements.
A firm’s compliance activity requires the collection, management, and governance of relevant, high-quality data, which is helped by strong IT infrastructure, governance systems, and processes. Firms that use these risk management systems not only meet regulatory requirements and maintain data quality, but also gain added value from the increasing amount of data they need to collect, manage, and analyse.
In addition, data privacy and data protection rules and regulations are increasingly mandated so financial institutions can accurately manage sensitive details or personally identifiable information. Compliance with such rules and obligations can be ensured by a robust GRC system while maintaining customer trust at the same time.
How does automation streamline compliance?
GRC systems must be able to address these risks that have come about because of digitalisation.
In the digital age, financial firms have access to growing amounts of data, so they must use new technology – from automation to AI, Machine Learning, and Natural Language Processing – to gather, manage, and parse this data.
The increased focus on strategic activities will not only enable employees to concentrate on more important tasks but will also improve the ability of organizations to deal with unexpected risks proactively. In addition to supporting business objectives, advanced technology can assist with risk and compliance, such as tracking regulatory changes and mapping regulatory requirements to internal data on risks and controls.
Automation can support compliance with ease by tracking regulatory change and mapping requirements to internal data on risks and controls. Automation can support compliance, for example, by tracking regulatory change and mapping requirements to internal data on risks and controls.
In addition to mapping and categorizing organisational risks, NLP can also help compliance teams. Patterns can be identified and detected automatically, and risk mitigation measures can be improved with AI integrated into GRC processes.
With digital transformation comes possibilities as well as risks.
If a business wants to take advantage of the digital world’s challenges and prospects, it must leverage this shift to its advantage.
Transformation processes are becoming increasingly sophisticated, and technology has become increasingly embedded into our normal life. They enable and necessitate the digital transformation of management, business, and manufacturing processes. Seize the possibility.
Digitalization has progressed to the point where it is no longer only an IT issue. Now we are examining how innovation affects governance, risk, and compliance systems (GRC). Cyberspace has never been more transparent, presenting new risks, which is why more and more businesses are not only accepting the challenge but also paying very close attention to it from a risk management approach.
Companies can’t keep thinking of GRC as a storage system for risk and compliance data that isn’t contextualised. They also can’t conceive of risk and compliance as a one-time effort; it is a never-ending journey that requires regular monitoring and optimization.
Why is the GRC framework in need of a digital transformation?
- The GRC components often work in silos and do not tap into the data available across various functions.
- It is often difficult to modify the existing framework due to its inflexibility.
- An organization’s GRC does not play a crucial role in decision-making and a majority of GRC frameworks cannot detect it. breaches, leading to huge losses for organizations.
Enhance Organization’s Resilience Through Digital Transformation
The regulations regarding risk reshape as the race toward automation and a technology-driven environment intensify, and the hazards increase.
Organizations must guarantee their digital infrastructure can support such innovations to automate business activities, and they must have parameters and protections in place to protect themselves from the most serious threat: cybercriminals. Threats in the digital environment must be addressed in these solutions. Cybersecurity must be integrated into all practices, particularly those that include automation.
Furthermore, recent changes – such as the transition to a remote-work environment, the migration of internal networks to the cloud, and the rising usage of personal Wi-Fi networks without firewalls – have weakened security barriers, giving criminals new opportunities.
Governance is a crucial factor of success in managing digitalization, according to data from consultants Capgemini. Good governance is necessary to avoid and reduce the risks of digital transformation.
There are dangers in any digitalization project, but a comprehensive approach to digital transformation governance can help mitigate them. Governance must be an integral component of the digitalization strategy, not an afterthought or add-on. The governance approach should be a core pillar of the strategy.
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Akhila Nasneem is a young aspiring brand communication and digital marketing enthusiast. She enjoys writing blogs and promoting brands, and her favourite topics include GRC Software, Risk Management, Digital Marketing, and Artificial Intelligence, among others. Her other hobbies are creating artwork and befriending movies.