Managing Risk through Digital Transformation

Managing Risk through Digital Transformation

Managing Risk through Digital Transformation

For risk managers, a turning point has come. Companies are rapidly mastering digital technology in an environment where data is increasing, automation is growing, cyber attacks are becoming more sophisticated, and customer expectations are constantly growing and changing.

Despite the fact that many technological risks are already known, the introduction of digital technologies increases them even more. Given this, company executives want all of them to be taken into account and accepted at an acceptable level.

Risk management

Digital Transformation
Digital Transformation

Only by establishing a clear interaction with the risk management function, organizations can effectively use internal and external data to predict risks, as well as be fully confident in the correct management on the way to digital transformation. How can a risk management function help an organization succeed in implementing digital initiatives?

In a survey of company executives, experts concluded that the readiness of the risk management, compliance, and internal audit functions for digital transformation allows the organization to make more informed decisions in the field of risk management. At the same time, organizations attach different meanings to the concept of “digital transformation”.

For someone, this synonym is too often used for IT strategy. However, this concept goes beyond the mere use of new technologies and is interpreted more broadly.

Digital transformation is a new way to solve problems, create a unique experience of interacting with customers and employees and increase business efficiency.

Cybercrime cases

Cybersecurity incidents are ubiquitous and become headlines in news feeds, causing growing concern among consumers and business leaders. Despite such close attention, many organizations still face difficulties in recognizing and managing new cybersecurity risks. Every day the digital environment becomes more complex, our dependence on data and interaction is growing. Against this background, companies’ resistance to cyber shocks – large-scale events with devastating consequences, developing according to the cascade principle, is becoming increasingly important.

Every year, the destructive potential of cyberattacks is becoming increasingly apparent. For example, a cyber attack in Turkey in December 2015 affected the operation of the networks used by banks, the media, information and government institutions of the country. Later that month, for the first time as a result of a cyberattack on a power supply system, electricity distribution systems in Ukraine were disconnected, leaving 230,000 residents without electricity. The attack also targeted the country’s telephone system, which did not allow consumers to report power outages and, as a result, impeded efforts to restore energy supply.

In the spring and summer of 2017, computers of many companies around the world were hit by a number of cryptographic viruses, which led to malfunctions and downtime in the digital and operational activities of large international companies. In addition to this, the risks associated with massive data leaks reinforce concerns about the potential impact of cyberattacks on the global economy.

Especially because of such cases, it is important not only to have an idea of ​​what cyber attacks and cybercrime are, but also to try to provide yourself and your business with a reliable level of cybersecurity.

What are the risks of digital conversion and what can be done

Risks of digital conversion
Risks of digital conversion

Most organizations cannot provide security normally if they do not have a digital risk management program. On the other hand, if they have an active digital risk management program, then they can do it through digital transformation.

GRC / IRM solutions now have 3 specific use cases that can be very effective, and they can be up and running fast enough to take the company on this path of digital risk management.

The first and most common one is associated with cyber risk. There are 2 effective business methods in this area. One of them is to completely prevent this by having a strong vulnerability response program. This will be an opportunity for you to make sure that you are correcting the right things that are important for the business and are quick to respond to any type of vulnerability so that hackers can’t even log in.

Another area of ​​cyber attack is the rapid response and prevention of potential breach, namely Security Incident Response (SIR). When it comes to a breach incident, the organization can quickly prioritize and make sure that it responds to the most important of them as quickly as possible to prevent damage. 

The second use case will be a third-party risk. If the organization was thinking about attracting new revenue streams or reducing costs from the supply chain, then it also thought about transferring part of the affairs to the outsourcing company. The ability to understand the risks this can bring to your organization and whether you will be safe again is crucial.

There are systems in place to quickly evaluate any third parties to find out if they pose a potential risk, and to make sure that these risks are reduced, can help us enter the market faster and enter the market faster, as well as accelerate the return on some of these new services and revenue streams.

As part of an entire business sustainability program, experts are increasingly seeing digital transformation. It changes every part of management, risk and compliance.

Results

If companies learn from historical examples, analyze current conditions, take as a basis best practices and working methods, then they will cope with all the difficulties of the digital age and will be able to provide a responsible approach to enterprise management. Including, using automation systems and the experience of cybersecurity experts, they will be able to achieve greater transparency and take risks under control. Today there is no doubt that the one who cares about information security wins in the digital age.