Assessing Risk and Building the Foundation for Enterprise Risk Management
Enterprise Risk Management (ERM) is a structured entity-wide governance approach used to identify, quantify, respond to, and monitor the consequences of potential risks and opportunities. With the increasing focus on regulatory and compliance requirements, organizations are more focused than ever on how to deploy and manage successful ERM programs. Organizations must conduct preliminary risk assessments, determine appropriate risk responses, maintain and monitor control activities, and create and distribute meaningful status and issues reporting. The program can seem overwhelming.

Conducting the Risk Assessment
Organizations do not all operate in the same environment, share the same objectives, or face the same risks. As a result, the cornerstone of an ERM program is a well organized, logical, and consistently applied risk assessment. The goal of this process is to identify those business areas that are most likely to pose significant risks to the organization. During the risk assessment, management can prioritize business processes by using a combination of operational and financial Key Risk Indicators (KRIs) to create risk scores for different business areas. The resulting scores provide business process prioritization that drives the scope of the ERM Program.

Performing this type of risk assessment can be a significant effort. Risk indicators need to be identified, scores given and tracked, and risk reporting and heat maps that measure this information need to be created and analyzed. Many risk managers become overwhelmed with the administrative requirements of the risk assessment, and data can often become outdated or error-prone. Rather than focusing on prioritizing and analyzing business processes, many organizations struggle with just operating the program.

By using Governance Insight, the industry leading ERM software platform, organizations can complete, document, and test their risk assessments more quickly and efficiently. The software provides risk assessment templates, collects risk ratings from executives and line managers, centralizes risk assessment data, ensures data integrity, and provides on-demand reports that provide easy drill-down analysis capability.

The Next Phase: ERM
Organizations that have conducted a risk assessment have completed the first – and most difficult part of an ERM program. By properly using the information gathered during the risk assessment exercise, institutions can prioritize and plan their ERM efforts. With maximum efficiency and effectiveness as the goal, risk management efforts can be focused on the highest risk processes, products, and systems.

The most successful organizations develop project plans where business processes are documented, analyzed, monitored, and audited based on their risk ratings. Higher risk processes must be examined more closely, with the goal of identified and responding to the most critical risk events that exist in the organization. Hundreds of risks may be identified and evaluated, with corresponding risk responses and mitigation activities documented and managed as well. Reports of the effectiveness of the program must also be created, so that organizations can understand the impact and effectiveness of their ERM programs.

Governance Insight streamlines the entire ERM process and integrates documentation, analysis, and testing information into a well organized and easy to maintain database. Documentation and workflow is managed, activities are tracked, and policies and regulations are maintained and updated. Customers can also use the software’s executive dashboards and reports to track progress, manage issues, and ensure accountability. Software is supplemented by training, education, and mentoring services from Vital Insight’s ERM experts and partners.

Vital Insight's Products and Services
Today, Vital Insight is helping forward-thinking companies redefine how they approach risk management at an enterprise level. Our solutions provide an integrated approach to ERM, helping customers to plan, implement, monitor, and report on risks and controls using Governance Insight™ for ERM.

Governance Insight combines elements of risk and compliance programs using a single collaborative system. Built on industry best practices, our platform incorporates flexible frameworks, advanced business modeling, and an easy way to structure, automate, and measure risk management.

Using Governance Insight ERM, customers can:

• Lower compliance costs by up to 70% through best-in-class risk assessment capabilities
  
• Decrease regulatory compliance and exposure by integrating compliance activities, requirements, and documents into a single repository
  
• Significantly reduce risk exposure by implementing early warning signs that detect problems before they become compliance issues
  
• Deliver meaningful, on-demand status reporting and analysis
  
• Improve process adherence with governance programs that can be easily implemented across the enterprise
  

In addition, Vital Insight’s Professional Services Team is comprised of ERM Experts that help our customers move down the path to ERM more efficiently. Our services team provides ERM content and education, including hands-on training, that can help our customers start their programs quickly. Once our customers have made progress and begun to institutionalize the process, our professionals can provide mentoring, oversight, and quality assurance for the project.