Source: businessamlive.com
The idea of data generating business value is not new. However, the effective use of data is becoming the foundation of competition. Business has always wanted to develop insights from information in order to make better, smarter, real-time, fact-based decisions. It is this demand for profundity of knowledge that has powered the growth of big data tools and platforms.
But just what is big data? According to Wikipedia, ‘’big data is a field that treats ways to analyze, systematically extract information from, or otherwise deal with data sets that are too large or complex to be dealt with by traditional data-processing application software’’.
Big data was originally associated with four key concepts: volume [the quantity of generated and stored data], variety [the type and nature of the data], velocity [the speed at which the data is generated and processed to meet the demands and challenges that lie in the path of growth and development] and veracity [the data quality and the data value].
Big data usually includes data sets with sizes beyond the ability of commonly used software tools to capture, curate, manage, and process data within a tolerable elapsed time. Its philosophy comprises unstructured, semi-structured and structured data. However, the main focus is usually on unstructured data.
Evolving technology has brought data analysis out of IT backrooms, and extended the potential of using data-driven results into every facet of an organization. However, while advances in software and hardware have facilitated the age of big data, technology is not the only consideration.
The diagram below by Guy Pearce explains it all: big data and other external data are fed into data analytics to generate reports for decision making. It’s that simple.
Big data is today transforming the world of GRC. A robust GRC culture represents how organizations govern, allocate resources and set internal control practices to regulate the actions. Big data potentially transmutes all of those areas. That’s why cultures built on big data and advanced analytics are increasingly synonymous with high-performance organizations.
The value of analytics is clear: finding insights in enormous amounts of previously untapped data. This helps management to base their decisions and strategies on facts and not dreads.
With increasing complexities, businesses need dynamic solutions, new investments and functional ideas. This can be supported by innovative technology solutions that can integrate and automate various processes and controls. Such tools analyze the risk landscape and helps management to monitor them frequently.
The effectiveness of GRC hinges on data. Being able to gather, analyze, and communicate information with the stakeholders and right format is critical. Hence, forward-thinking organizations are creating an infrastructure within the organization.
Moreover, the vast and growing volume of unstructured and structured data today provides limitless opportunities to improve risk intelligence, support compliance and augment customer relationships. The key elements of a digital GRC is shown in the diagram below.
The many benefits of big data in GRC include:
• Faster and more cost-effective transaction and fraud analysis;
• Improved continuous monitoring capabilities;
• Visual dashboards that compile data in new, more powerful ways;
• Integration of risk management, compliance, audit, and control management with business performance;
• Forward-looking (predictive) risk identification and assessment;
• Google-like searches capability of historical data; and
• Comprehensive relationship analysis for third party vendor management.
More and more organizations are investing resources to ramp up their efforts to use big data and analytics to drive growth. Yet, many companies feel they haven’t realized the full potential of their analytic capabilities. They feel exasperated that they aren’t doing more, faster.
To be sure, an organization can use a GRC platform leverage big data for a one stop solution for the data. That way, it is easier to understand the risks, standards and internal controls governing them and facilitate a better understanding of corporate risk profile.
Being able to pull data from several sources, and then fuse the data into actionable intelligence via graphical dashboards and reports is the key to driving operational efficiency and success. Innovative technology systems can deliver dynamic data visualizations that showcase trends and patterns in real-time which will aid executives make faster decisions.
However, the focus should not just remain on what has happened in the past and what is happening in the present, but also what it means for the future; the blending of historical insight and predictive foresight paves the way for a risk averse organization.
Big data and analytics are here to stay, and only those companies that understand the immeasurable potential of these tools, and effectively tap into various big data sources such as social media, location, multimedia, text, documents, surveillance, medical records, videos, e-commerce, emails, voice, audio transcripts, stock trades, transaction logs, geospatial data, and weblogs will be best positioned to enhance their GRC initiatives.
Leveraging the right systems, engaging the right teams, and taking a forward-looking approach to big data can help fast-track an organization’s journey to arrive at the ideal data-driven GRC culture, and push the envelope to achieve long-term success. So what’s old, is new again!