2015 trends predictions

8/18/2019 2015 Trends Predictions

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As regulations get tougher, and risks get more complex and

interconnected, the success - and very survival - of any business willdepend largely on how risk-aware, compliant, and well-governed they are.

A power and transportation company paysmillions of dollars in fines to settle charges ofbribery. A leading financial services companyis penalized billions of dollars for engaging intransactions with sanctioned countries. A topautomobile manufacturer recalls millions ofcars over faulty parts.

These were some of the stories that capturedour attention, and dominated news reports in2014. They demonstrate just how big of animpact risk can have when not properlyidentified, understood, and managed.

The volume, velocity, and variety of risks areonly likely to increase in today’s digital age,where a single Tweet or an unsecured mobiledevice is all it takes to damage the long-term

profitability and reputation of anorganization. Added to that, regulationsacross industries are becoming increasinglyonerous and complex.

The Big Picture

Therefore, it becomes obvious whygovernance, risk management, andcompliance has become so critical to thehealth and viability of any business today.

In 2014, many organizations embarked on a journey towards creating a pervasive cultureof GRC across their organization andextended ecosystem of third parties andsuppliers. In 2015, MetricStream predicts thatGRC will evolve to the next level, spanningareas such as social media, mobility, and thecloud – all integrated within the enterpriserisk management and compliance framework.

Risk managers will work towards establishinga real-time, 360-degree view of organizationalrisks. Sophisticated listening and big dataanalytics tools will be used to helpdecision-makers transform unstructuredenterprise data into valuable businessintelligence that can help predict riskscenarios and guide decision-making.Ultimately, the focus for every organization inthe year ahead will be on building a morerisk-aware, compliant, and well-governed

corporate culture and organization.

In this report, MetricStream takes a look atthe major GRC trends that shaped the year2014, and makes predictions for the yearahead.

Trends and Predictions

for GRC

2015


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Governance - whenwell-understood, carefullyplanned, and thoughtfullyexecuted, can be one of themost crucial drivers of growth.It serves not just as a guide forcorporate strategy, but also as

a competitive differentiator inan increasingly competitivebusiness environment. In 2014,organizations were pushed tothe limits, and tested in newways. GRC starts withgovernance, and the leaders oftomorrow will continue to betested in demonstrating the artand science of goodgovernance 24/7. The tone atthe top is critical. Wewitnessed several headlines in2014, where a complacent

corporate culture led todisaster. It is the responsibilityof those at the top to set thetone every single day throughtheir own words and actions, inorder to cultivate a trulyresponsible and risk-awarecompany.

GRC BEGINS WITH

GOOD GOVERNANCE

GRC isn’t new, butimplementing GRC in anintegrated manner, alignedwith business processes andstrategic objectives, issomething that manyorganizations have struggled

with. In 2014, we witnessedorganizations build the internalbusiness case for GRC that can

justify the correspondinginvestment. It requires not justa measurement of the tangiblevalue of GRC in terms of time,resources, and money saved,but more importantly, anarticulation of how better riskand compliance managementcan lead to actual profits.Increasingly, we are seeingGRC being discussed and

leveraged to not only protect,but also create value.

THE GRC VALUE

PROPOSITION IS CLEAR

In 2014, organizationsembraced Pervasive GRC,which is all about empoweringa modern and diverseuser-base across theorganization, embedding GRCwithin the enterprisearchitecture, and adapting GRCto the changing context of howbusiness is done. Thisapproach requires technologythat is user-friendly, hasubiquitous touch-points acrossdevices, is in-line with users’behavioral constructs, andprovides an immersiveexperience using gamification.

YEAR 2014 WAS A TURNINGPOINT FOR GRC

More and more organizationshave expanded beyondtraditional GRC, into new areassuch as supplier governance,ethics and compliance, privacy,quality management, and

environment, health, and safety.Designing and executing asuccessful GRC Journey is morethan a technology deployment –leaders now concur that it isabout helping accelerateorganizational readiness, andimproving business performanceby managing GRC as a programthat combines people, processes,and technologies. Implementingphased, multi-year GRC initiativestakes thoughtful planning, andrequires participation from the

right set of sponsors.Orchestrating success across awide range of stakeholders withdiverse approaches togovernance can be challenging –but the rewards around a360-degree view of risk, acommon risk language, andanalytics to supportdecision-making are compellingorganizations to bring down theirsilos, and get these essentialprograms in place.

ORGANIZATIONS AROUND

THE WORLD ARE REALIZING

SUCCESS THROUGH GRC JOURNEY

2014 in Review: So, What Did We Learn?

Here are some of the key trends that shaped the year 2014:


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Businesses needs to startplanning for the coming of ageof Gen C users - a generation ofhighly social, savvy,digitally-connected users whothrive on content, curation, andcommunity. This generationwill be the customers and

employees of tomorrow - andthey have different behaviorsand interaction paradigmscompared to the customersand employees of today.Meanwhile, social media willcontinue to be embedded intoday-to-day professional andpersonal lives -- from corporateapplications that integratesocial media widgets, to BYOD,and everything in-between. Anew team led by your ChiefInformation Officer (CIO) and

Chief Digital Officer will betasked with staying ahead ofthese changes and paradigmshifts. Understanding all of theassociated risks - andopportunities - will beimperative.

The “Internet of Things” is aboutconnecting people, things,devices, and information in new,game changing ways. Add to thatdisruptive e-payment methodslike Google Wallet and Apple Pay,and layer on top of that thecoming of age of Generation Cusers. The future of business isdigital, connected, mobile, andsocial. What worked yesterdaymay not necessarily work todayor tomorrow. Amidst this change,a laser sharp focus on risk iscritical – understanding risk,managing risk, mitigating risk,and thriving on risk.

THE RISE OF GENERATION C

If there’s one thing we’velearned, it’s that advancementdoesn’t happen, organizationsdon’t grow, and people don’tflourish if they are afraid totake risks. The organizations

and leaders who will continueto lead us bravely into this newmobile, social, and globalworld will not be afraid ofchanging the status quo. Fromdelivery drones, to mobilewallets, to the Internet ofThings, and everything inbetween, technology in 2015will continue to push andstretch the bounds of ourrealities and our imaginationsin surprising ways.

RISK AND OPPORTUNITY

ARE TWO SIDES OF

THE SAME COIN

THE LEADING DIGITALBUSINESSES OF TOMORROW

ARE BEING CREATED TODAY

Arguably, the CRO has themost important job of anyonein the organization. The CROsof tomorrow must be agile,analytical thinkers and leaders,who are able to turn data into

insight, and coordinate riskmanagement activities acrossbusiness units and externalthird parties, while alsopartnering with managementto guide corporate strategy. Itis a big job, and in 2015, we willsee CROs really step up to theplate.

THE MISSION CRITICAL

ROLE IS THAT OF THE

CHIEF RISK OFFICER (CRO)

Looking ahead to the year2015, we will see theemergence of a new criticalorganizational role - the ChiefData Officer. This person willemerge from theorganization’s Data Scientist

role, and will possess strongleft brain and right braincompetencies, will excel in theareas of math and science, butwill also be extremely curious,collaborative, andcommunicative. Passionateabout data, these individualswill help lead theorganizational charge, workingright alongside other keybusiness leaders such as theChief Data Officer, the ChiefDigital Officer, the Chief

Information Officer, and theChief Risk Officer to drivebetter decision-making, andenhance businessperformance.

THE RISE OF THE CHIEF

DATA OFFICER

In 2015, leading organizations

will leverage moresophisticated models andadvanced analytics to betterunderstand the real-time risktrends and relationshipsbetween seemingly disparatedata points. Furthermore, dataspanning customercomplaints, litigation, controltest failures, and KRIs will bebrought together to paint atruly holistic picture oforganizational risk. The aimwill be to collaborate through a

federated governance modelby bringing all keystakeholders and datatogether into a common riskand control framework.

PAINTING A HOLISTIC

RISK PICTURE

2015 Predictions: What Does the Future Hold?

MetricStream predicts the key GRC trends that

organizations are likely to face in the year ahead:


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Decision-makers and key usersare discovering the benefitsand synergies that existbetween policy, risk, and

compliance management. In2015, we will see moreorganizations adopt a commontechnology platform that canharmoniously manage all threeareas together.

GRC TECHNOLOGY WILL

BE CHARACTERIZED BY

CONVERGENCE AND

ENTERPRISE-WIDE

ADOPTION

The unprecedented volume,variety, veracity, and velocity ofstructured and unstructuredinformation, also known as BigData, is any organization’sbiggest opportunity.Sophisticated Big Dataprocessing technologies now

have the capability toaggregate and analyze socialmedia and location-enabledsites, multimedia, documents,emails, weblogs, surveillancerecords, medical records,threat and vulnerabilityscanners, supplier data,regulatory feeds, e-commercetransactions, voice notes,audio transcripts, stock trades,transaction logs, geo-spatialdata, and more -- all in real ornear-real-time. As a result,

organizations will be able toidentify trends and spotanomalies based on arules-based framework, in away that can help strengthentheir risk and regulatorycompliance efforts. Forexample, social media contentcan be used to provide keycustomer insights, andsupplier data in aggregate canprovide key indicators aroundsupplier financials andbehaviors that support thirdparty vendor due-diligence.The biggest challenge facingany organization in the yearahead will lie in their ability todistill the signals from thenoise. New business rules willalso need to be created andimproved to eliminate the falsepositives.

THE BIG DATA OPPORTUNITY

While those rare black swanevents may never be fullydetected and prevented, weare getting closer tounderstanding the underlyingthemes and patterns thatcontribute to high risk and

high impact events. In 2015,emerging risks will receivegreater attention in thegovernance process, alongwith stress tests ofidiosyncratic risks linked tomacroeconomic indicators.Organizations will need to lookat historical data and currenttrends across key internal andexternal emerging risks, andthen translate that intoforward-looking riskgovernance processes.

WE ARE MOVING TOWARDS

PREDICTIVE ANALYTICS

2015 Predictions: What Does the Future Hold?

MetricStream predicts the key GRC trends that

organizations are likely to face in the year ahead:

2015 trends predictions

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