Other than providing solutions in the form of quality products and services, a business’s primary purpose of existence is profitability. Yet, to make such profits, businesses need to have excellent administration. Organizations with great leadership and administration are observed to accomplish their objectives. Additionally, organizations need to have an effective risk alleviation plan. In the corporate landscape, risks are inescapable—each organization, regardless of whether a small startup or based on a large scale, has to experience different risks.
What makes them different is how they deal with these risks and manage to thrive. Also, organizations need to comply with the legal regulations and their policies. Businesses can only succeed if they operate in a disciplined manner. With these three factors consolidated, businesses increase their chances of achieving their short-term and long-term objectives.
If a business follows the framework of Governance Risk Compliance (GRC), it’s an indication that they have good governance and leadership, an efficient plan for risk management and mitigation, and abide by the country laws and state regulations.
What Is Governance Risk and Compliance (GCR)?
In the corporate world, the term Governance Risk and Compliance (GCR) suggests a company’s compliance with governance, risk alleviation, and laws. These three factors are focused on helping organizations accomplish their goals. It’s an organized approach to managing primary business operations, and if planned well, it can lead to handsome revenues and profits.
However, if this approach isn’t appropriately integrated within an organization, it won’t prove to be effective in goal achievement.
Let’s dive deeper into the basic concept of each factor.
This alludes to a business management approach utilized by senior officials. It guarantees that all company frameworks are in line with the company’s short-term and long-term goals. A company without good governance cannot completely execute the other two facets of GCR. This approach also ensures that every piece of information received by the senior executives is factual and error-free, so it can be used to make decisions critical for accelerating business growth.
This factor refers to every activity that helps identify and analyze potential risks that may keep an organization from accomplishing its objectives and goals. Organizations have a wide range of risks that may influence their operations. However, the effect of these risks on an organization’s existing position will vary in general.
The last facet of the GRC framework refers to an organization’s compliance with its internal policies and state regulations and legal obligations. Here, the company’s management focuses on determining whether their organization is abiding by statutory and internal requirements. The management must also consider the potential repercussions of non-compliance with these prerequisites and devise remedial measures accordingly. Additionally, they must be informed about any changes in the laws on a national and state level.
Though every employee of a company is responsible for the execution of the GCR framework, it mostly depends on the top-level hierarchy. This is because they are required to regulate and monitor the business, establish realistic goals, and make critical business decisions.
What is Information Technology (IT) GRC?
It is a framework that focuses on authorizing the IT department of a company to help it move forward and accomplishing the goals by conforming to all its rulings. In simpler terms, IT GRC is the application of Information Technology in better management of governance, risks, and compliance on an organizational level. Many businesses are already utilizing this framework to boost their profitability to achieve their targets. A typical example of IT GRC is the use of a spreadsheet for data entry, storage, and analysis.
How Is IT GRC Beneficial for Organizations?
Other than the automation of regular business tasks, IT GRC offers the following advantages to companies:
Cybersecurity is one of the significant benefits of implementing the IT GRC framework in an organization. Cybercrimes have surged significantly in the past few years, and the threat has prompted businesses to contemplate over their data security regulations. In the current corporate landscape, an effective cybersecurity system is a regulatory mandate.
Timely Analysis of All Business Reports
IT GRC enables businesses to generate updated reports on the organization’s operations and workflow. Reporting analysis is especially helpful when businesses want to observe how well a particular change in the policies has been implemented throughout the organization.
Ease of Information Collection
By automating the regular tasks, IT GRC makes it easier for businesses to assemble data. It allows management to circulate surveys and questionnaires electronically via the company’s email and collect all the responses. This is a hassle-free approach that costs significantly less and requires little time for data analysis.
Boost Business Profits:
Companies that deploy the IT GRC framework tend to operate more efficiently. They can extract useful information from their data in no time and implement useful insights to stay ahead of their competition. Furthermore, they promptly update their policies and operations according to the changing state laws, which leads to higher customer trust, and ultimately, improved revenues.
Efficient Allocation of Resources
With the IT GRC framework’s help, companies can identify the grey areas, including the non-functioning departments, projects, or product lines that are consuming excessive resources but aren’t profitable. Businesses can move their resource allocation from such areas to others that generate more revenues and profits.
Enhanced Communication Among Departments
IT GRC enables the top hierarchy to effectively communicate the company’s objectives to all the departments in an organization to ensure all of them work toward achieving a collective organization goal. They can further notify all employees about the recent changes via emails or other automated platforms.
Common Challenges Faced by Businesses That Implement IT GRC Framework
- Every unit and department of a company adopting the IT GRC framework has to conduct its own auditing because this approach lacks a centralized auditing policy.
- Though this framework is expected to secure the policies, strategies, and controls, the extensive auditing processes in large scale organizations may have affected it at some point, leading to compromised security.
Finding the Right IT GRC Tool for Your Business
Though every tool used in the IT GRC framework is useful in an organization’s success, the enormity of profits could rise exponentially if organizations choose the right IT GRC tool, attuned to fulfil their business requirements.
Here are some critical factors that companies must consider while choosing an IT GRC tool:
- Is the tool user-friendly?
- Is the data depository aligned with your company’s needs?
- What are the tasks that the tool can automate?
- Does the tool’s data modeling capabilities fulfil your business requirements?
If you’re able to pick the appropriate tool, you can reap the real benefits of IT-Governance Risk Compliance.