Integrated Risk Management: Software Applications vs. Platforms 

As a risk manager, you know that risk management is a critical component of your success. You need to be able to identify, assess, and mitigate risks to ensure that your business can operate smoothly and safely. One excellent way to achieve this feat is by implementing Integrated Risk Management. Among other benefits, IRM can help your organization lower compliance costs, significantly reduce fraud and remediation costs, and lower reputation risks. 

However, one of the major dilemmas risk managers face when implementing integrated risk management is choosing between software and platform applications. Read on to learn the differences between software applications and platform applications and which option is better. 

Risk management. Infografics of risk management.

What’s Integrated Risk Management (IRM)? 

IRM entails the identification, assessment, and management of risks across an organization, including operational, financial, strategic, and compliance risks. IRM is an important strategy for effectively managing risks; recently, more organizations have been implementing it. In fact, a study found that the global IRM solutions market was valued at $70,345 million in 2021. This figure will only increase over time. 

Software Applications vs. Platforms for Integrated Risk Management 

Software Applications for Integrated Risk Management 

Software applications are specific tools designed to perform a particular function, such as risk assessment, risk management, or compliance management. They are often used by smaller organizations or departments within larger organizations that focus on one area of risk management. Software applications for IRM typically provide the following features: 

  • Risk Assessment: IRM software applications provide tools for identifying and assessing risks across different areas of the organization, such as finance, operations, and IT. They often use a range of risk assessment techniques, such as risk matrices and heat maps, to visualize risks and prioritize them based on their likelihood and impact. 
  • Risk Mitigation: Software applications for risk mitigation help you implement measures to reduce or eliminate identified risks. They often provide guidance on the best course of action based on the severity of the risk and the available resources. 
  • Risk Monitoring: Software applications for risk monitoring help you track and manage risks over time. They provide real-time updates on risk status and allow you to make adjustments to your risk management plan as needed. 
  • Reporting and Analytics: IRM software applications often provide reporting and analytics capabilities to help organizations track and measure the effectiveness of their risk management efforts. These applications may include customizable dashboards, reporting templates, and data visualization tools to help organizations gain insights into their risk profile and make data-driven risk management decisions. 
  • Cybersecurity Management: IRM software applications can provide cybersecurity management capabilities to help organizations manage and mitigate cybersecurity risks. These applications may include features such as vulnerability scanning, threat detection, and incident response planning. 

Platforms for Integrated Risk Management 

Platforms are more comprehensive solutions that provide a range of tools for different areas of risk management. They are often used by larger organizations or those with more complex risk management needs. Platforms for IRM typically provide the following features: 

  • Risk Assessment: Platforms for risk assessment often provide more comprehensive and customizable risk assessment tools, allowing you to evaluate risks based on specific criteria relevant to your organization. They also often integrate with other tools, such as financial analysis software, to provide a more complete picture of risks. 
  • Risk Mitigation: Platforms for risk mitigation often provide a range of tools for different types of risks, such as compliance management, crisis management, and cybersecurity. They also often integrate with other tools, such as incident management software, to provide a more comprehensive risk management solution. 
  • Risk Monitoring: Platforms for risk monitoring often provide more advanced tools for monitoring risks, such as real-time data analysis and predictive modeling. They also often integrate with other tools, such as business intelligence software, to provide a more complete view of risk across the organization. 
  • Compliance Management: Platforms for compliance management provide a range of tools for ensuring that organizations comply with regulatory requirements, standards, and policies. They often provide customizable workflows and automation capabilities to streamline compliance processes and improve efficiency. 
  • Cybersecurity Management: Platforms for cybersecurity management provide a range of tools for identifying, assessing, and managing cybersecurity risks. They often provide advanced tools for threat detection, vulnerability management, and incident response. 

Which Is Better: Software Applications or Platforms? 

The answer to this question depends on your organization’s needs and resources. If you are a small business or department within a larger organization with a specific area of risk management focus, a software application may be the best choice. They are often more affordable and easier to implement than platforms, and they can provide a focused solution to your specific risk management needs. 

However, if you are a larger organization with more complex risk management needs, a platform may be the better choice. Platforms provide a more comprehensive solution to risk management, integrating multiple tools and functions to provide a complete picture of risk across the organization. While they may be more expensive and require more resources to implement, they can provide significant benefits in terms of efficiency, scalability, effectiveness, and risk reduction. 

Ultimately, the decision between software applications and platforms for Integrated Risk Management comes down to your organization’s unique needs and resources. You need to carefully evaluate the features and benefits of each option and weigh them against your budget, organizational structure, and risk management objectives. Whatever solution you choose, always remember that effective risk management is an ongoing process that requires continuous evaluation and adjustment to stay ahead of emerging risks and threats.