Risk management that helps you grow faster

By Pete Alltree, Senior Manager, Analytics, Risk Advisory EY.

Most people would agree that the risks facing businesses today are more complex, varied and rapidly changing than ever before.

Geopolitical uncertainty is rising, digital disruption is threatening traditional business models and the search for growth is taking companies into unfamiliar markets. In addition, robotic process automation and the internet of things are increasing interconnectivity and the risks around sharing and protecting data continue to grow. All these factors are bringing new compliance challenges – from tax and trade to GDPR and employment laws – and at a time when regulators are bringing in new rules to keep up with a rapidly changing business environment.

Given these multiple challenges, risk professionals are under pressure to manage new and greater risks, while at the same time supporting innovation and rapid change. Both these objectives require more understanding and clarity over the workings of their organisations yet the traditional approach of analysing partial or sample data is no longer enough. In order to provide answers, or to achieve the confidence required, organisations need to analyse all the data available, and much more quickly than before.

To exacerbate the challenges further, risk functions are often being asked to operate with fewer resources as companies seek to reduce overheads to succeed in competitive markets.

Yet the reality is that many businesses are being held back by manual risk management processes that are costly, fragmented and provide limited visibility. Many companies manage compliance in silos with no single view, at a time when boards are demanding more accurate, timely and insightful compliance reporting.

The data-driven opportunity

The good news is that the shift to digital and the ability to easily analyse growing volumes of data has created the opportunity for companies to better measure and understand all their activities and related risks. This gives organisations the chance to transform their risk management functions by harnessing advances in data analytics to gain a single, integrated view across all their activities.

The obstacles to achieving this are typically twofold. Firstly, risk functions can operate within silos, making it difficult to achieve one company-wide picture built on common data. Secondly, while most organisations have advanced skills in each of risk management, data analytics, finance and ERP systems, they lack a team or individuals with the combination of those skills required to make the most of the opportunities being presented.

Helping you to go faster, more safely

To help our clients address this challenge, we have developed an advanced analytic capability that provides an accurate view of risks and issues by building a comprehensive and detailed picture of what is really happening in their business.

While traditional analytic capabilities are unable to interrogate all data at once, EY Risk Navigator Analytics provides a complete end-to-end view of your processes, enabling a clearer understanding of risks and where they are not controlled effectively. It does so by taking historical transaction data from various ERP and other sources and combining it to create a single unambiguous, context-rich view of how things are working by utilising our industry-leading key risk indicator (KRI) analytics.

The demand for more knowledge, certainty and confidence

Today’s risk issues mean that organisations find themselves needing to analyse all available data in a more thorough way in order to achieve the desired level of understanding. By grouping, cleaning and sorting data from right across an organisation, our service provides greater precision and insight, so that the answers provided are clearer and more accurate. It also prioritises results according to their impact, so that the most pressing risks are highlighted first, according to their financial, compliance or reputational effect. And because EY Risk Navigator Analytics enables richer, more granular data, it creates the context that you need to better understand each risk. For example, by assessing the individual lifecycle of each procured item and comparing to others, it can not only highlight unexpected deviations but provide detail on why they stand out.

How does it work?

The data from your SAP or other ERP system is extracted, sorted, cleaned and run through our analytics process. The results are visualised using dashboards designed to meet a business’s individual needs.

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As a result, organisations can benefit from a clearer understanding of risk and the ability to visualise the end to end process. They can also gain greater insight into how effectively controls are managing risks and quantifying the cost of risk or compliance failure.

By enabling organisations to rapidly deploy robust risk monitoring capabilities, EY Risk Navigator Analytics supports mature risk management processes and can drive value for your business.

The pace of business change is not expected to slow in the near future while increasing numbers of Risk professionals are likely to be asked to operate with fewer resources. However you choose to respond to these challenges, it is clear that the opportunity to harness the very advances at the heart of this demanding environment could be the answer.

To find out more about how we can help you turn uncertainty into confidence, please contact Pete Alltree.

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