Banks are increasingly interested in digital risk transformation because they promise to deliver not only improved efficiencies but also data intelligence features and benefits that can enable banks to better serve their communities. While it is easy to understand that the digital risk transformation will enhance the current risk framework of the bank, the particulars of the enhancements are often not clear.

In a recent case study 360factors tracks a mid-sized bank’s risk implementation journey. The end-part of the journey is about how the bank benefited from the risk technology in practical terms. These outcomes are important to understand because they bring clarity to what a bank can expect from a digital risk transformation.

This clarity is necessary for any cost benefit analysis that a bank may need to do regarding the implementation. Instead of justifying implementation costs by comparing it to a vague promise of better performance, the management can determine the benefits that will be provided and directly compare their value to the cost of the solution.

Risk Mapping

Risk management solutions enable the risk team to map Key Risk Indicators (KRIs) to risks, controls and much more. This risk maps provides a foundation for instant analysis and in-depth insights for how different items, documents, and policies interact with enterprise risks. It also enables instant reporting of real-time risk levels and metrics across the organization.

Risk management solutions enable the risk team to map Key Risk Indicators (KRIs) to risks, controls and much more. Click To Tweet

Real-Time Metrics

Access to risk metrics and risk mapping enable real-time KRIs. CROs can view the most important KRIs on an executive dashboard and are immediately notified if the value of a KRI goes beyond tolerance levels. The CRO and the risk team do not need to wait for reports or data at the end of the month – they get instantly notified of changes in risk levels.

Intelligent Task Management

Making the risk metrics and KRIs visible is the first step in creating a better and faster process workflow for risk mitigation. CROs now get the ability to not just view risk incidents and reports but also instantly assign tasks to team members with one click. The task is instantly visible to the team member it is assigned to and the employee and the team members assigned can share details and discuss action items on the same platform.

Dynamic Reporting Frequency

Risk management platforms centralize risk data and enable the risk team to slice and dice the data as required, which results in better insights and analytics. When risk is managed manually, an employee must create a report for a specific time period whenever required. Risk management platforms allow CROs to instantly change the metric visibility and reporting to daily, weekly, or quarterly. This enables them to look at the latest data, put it in context by viewing the big picture, and much more in just a few clicks.

Trends and Insights

Tracking risk metrics and trends allows CROs to get better insights about the past and it also enables better data for emerging risks. Instead of working with data from the previous quarter, the CROs and the risk team can view intelligent predictions of potential emerging risks.

Proactive Risk Mitigation

The risk team can prepare an enterprise-wide risk profile “shock” with these forecasted metric values. Instead of reacting to risks as they are discovered, the risk team can detect the most vulnerable parts of the bank’s risk framework based on predictions and create plans to mitigate risks before they are actualized. This can also be a major competitive advantage; banks can perform better than the competition by being better prepared for the future.

Smarter Growth

Predictive risk metrics don’t just bring to light the biggest upcoming threats – they also illuminate the biggest upcoming opportunities for growth and investments. Having business intelligence about future risk metrics enables banks to strategically plan for growth with the highest potential of success. Instead of simply deciding where the bank wants to be in the future, the bank can map out the most probable changes in the coming months and then chart a course based on that information.

Read more in our case study

This topic and more are explored in depth in our latest case study The Journey from Legacy ERM to Real-Time Risk Analytics. Download the case study to see the impact these outcomes will have on the bank’s future plans and the process the bank went through to enable these features. Want to see how similar outcomes can be achieved in your organization? Get in touch with our risk and compliance experts for a demonstration.