Big data is a hot topic in the business world, with seemingly everyone wanting to exploit the value and insights they can derive from data, and there is good reason for that. Data is one of the most valuable resources available to an organisation and GRC (Governance, Risk & Compliance) data is no exception.
Large quantities of high-quality GRC data can bring huge advantages for businesses. Data builds a transparent picture of daily operations & performance, making it easy for leaders to spot problems and uncover areas for improvement. But as businesses start to use data to drive decision making and reshape processes, it brings data accuracy into sharp focus. Wrongly entered data and inaccurate information could lead to bad decisions that could have a negative impact on business operations.
Whilst large quantities of data can be extremely valuable for GRC programmes, unfortunately, not all data cuts it. Big data is only useful if it’s high quality. At its best, bad GRC data might be unusable and insignificant. At its very worst, poor quality data can result in significant consequences for business leaders who can end up making critical business decisions based on the wrong information. If poor data quality is left unaddressed, it can lead to operational failures, inaccurate analytics, and ill-conceived business strategies. So much so that IBM research estimated that bad data sets back the United States’ economy a whopping $3.1 trillion every year.
The emphasis on the importance of data quality in enterprise GRC has increased as data analytics become more intricately linked with business decisions. Inaccurate data for risk & compliance programmes can leave businesses exposed to both unforeseen risks, and hefty fines & penalties relating to non-compliance. High quality data entry is critical to build a comprehensive view for risk & compliance teams.
The stigma around data entry
Data problems can arise when employees – whose job it is to manually input and process data – can fail to see the importance of their role. Data entry can often be viewed as an arduous, time-consuming task, and without a thorough understanding of how the data is being used, staff can be tempted to cut corners. As they miss fields, abbreviate text, or take shortcuts, they miss out key steps in the process, compromising data consistency. This sub quality data entry and inconsistent formatting will have a huge effect on a business. By failing to provide boards and executives with a real-time understanding of how their organisation is performing against their risk appetite and compliance obligations – it leaves the business exposed.
Employees on the front line need training to realise what happens if they ‘don’t tick a box’ or ‘leave a field empty’. They need to understand the context of how the data is being used to enable them to comprehend the importance of the data they are entering. This will encourage thorough data entry. Similarly, if there is time consuming data being entered that is not being used elsewhere in the process, this can be eliminated saving valuable time and resources.
Only collect critical data that will add value and drive decisions
Too much data can also cause problems. The reality is that GRC departments are at times overwhelmed with finding the relevant data within such a large pool of information. And when they do, they might not know if it’s current or accurate. As a result, IT departments and executives can become overburdened with producing status updates and constant reports. This cumbersome process leaves c-level executives frustrated with fragmented procedures that swallow up valuable time & resources and are often based on outdated information, which negatively impacts data-informed decision making. In a nutshell bad data management can lead to a multi-faceted catastrophe for GRC programmes.
Manual processes can lead to further data governance problems
Quality data is perhaps one of the most important parts of a successful GRC programme, making data governance a key requirement of GRC tools and processes. While using manual processes may bring a human dimension to data governance, it can also lead to inconsistency.
Shared folders, excel documents, emails and joint file locations are simply not an efficient way to collect data consistently and share information amongst teams. File sharing can lead to overwritten data and can result in users being blocked out of documents for hours. Microsoft applications like excel and word, do not have the formatting and rules in place to ensure consistent data entry and perform adequate reporting. Linking information and cross-referencing data is very limited when using manual methods, leading to disjointed processes and siloed departments. Data inconsistencies can be lost in a sea of information – resulting in limited visibility – leading to missed deadlines and flawed approval processes. Manual reporting and data crunching tasks also take up valuable time, which otherwise could be utilised to fix problems and improve processes.
To that end, businesses are turning to GRC tools to provide the data governance rules required to ensure data is not only usable & accessible, but that it is collected in a structured, methodical, and timestamped way.
Why are there so many barriers to data entry?
With data quality and governance forming the foundation of digital transformation initiatives for contemporary businesses, the question remains, why do so many companies suffer from data barriers? For one, businesses may not have an efficient data governance team in charge. Secondly, they may use manual and labour-intensive processes that result in human errors and lengthy procedures. Thirdly, outdated legacy systems which are not integrated with other tools may pose escalating obstacles. Some organisations might not even have best practice data governance principles in place. For others, it very well could be a combination of all these factors.
Bad data is often the root cause of poor decision making and integrity issues and can cause a variety of other organisational problems relating to resource allocation, budgeting, forecasting and operational performance.
How can I improve data integrity in my GRC programme?
It is vital to establish codes of conduct and best practices in data management and ensure that the needs and concerns extending beyond traditional data areas – including compliance, legal and security – are addressed.
Rules and data governance guidelines must be introduced to improve data quality, and often the best way to ensure the rules are being followed is to implement a best-practice GRC solution. GRC tools can support organisations to avoid errors and inconsistencies within data by adding structure to the data collection process.
Software contains rules around data entry, users must select from pre-configured dropdowns, eliminating abbreviations, and pre-set rules require all fields to be completed before staff can move on to the next stage of the process. Software also accommodates multiple users and tracks their activity; data entry is time-stamped, and all changes are tracked. Users can set controls which trigger notifications when KPIs or risk tolerances are reached, when things need approval, and when deadlines are missed – which further automates the process.
Information from other systems can be automatically pulled into the solution via API’s saving valuable data entry time and ensuring a single source of truth across all systems.
How software is effectively capturing big data in the GRC sphere
Today’s data-driven organisations require an integrated GRC solution that brings together data quality, lineage, and governance, allowing users to leverage data across the enterprise to improve processes and operations. By automating data governance principles and the associated components, companies reap the benefits that extend beyond accurate reporting, streamlined analysis and smarter data-driven decision making.
Effective data governance facilitated by GRC software offers multiple benefits to an organisation, including:
- Improved Quality of Data – Provides a structured step-by-step process that ensures data accuracy, completeness, and consistency – ensuring no data is missed.
- Data Consistency – Set rules to ensure consistency by using common terminology – and use drop down menus to ensure standardisation – while allowing for additional comments when needed.
- Data Mapping – GRC tools help to define linkages between data from other systems and other areas of the business. For example, risks of non-compliance can be automatically added to the risk register -reducing data entry time.
- A 360-degree view of all business entities – Establishes a centralised location for all GRC data, allowing organisations to agree on “a single version of the truth” to ensure consistency and increase visibility across teams.
- Best-Practice Compliance Workflows – Provides out of the box workflows to meet the demands of regulations such as HIPAA and GDPR, and industry requirements such as PCI DSS and ISO standards – ensuring structured processes that instantly meet requirements.
- Automation – Users can easily implement workflows for changes and approvals, ensuring processes are fully completed from start to finish with the correct authorisation. Automatic notifications can be sent when there are anomalies in the data, certain levels are reached, or things require approval.
- Real -Time Reports & Dashboards – Staff can access reports and dashboards instantly to view progress and provide updates for management, auditors, and regulators.
Setting up your GRC tool – Quality in equals quality out
As with most things in life, “You get out what you put in” and GRC software is no different. It is only when your teams are entering accurate, relevant data that you can get the high-quality output needed to drive risk-based decision making.
In our recent webinar titled “Digital Transformation of Strategic Risk Management and data-driven reporting”, Emmanuel Rickard, Head of Enterprise Performance & Change at Mizuho, commented that “Organisations tend to get into a mindset that nothing beats excel, and what we often find is that when a tool is put in, and is up and running, the first thing they often try to do is to figure out a way to export the tool into Excel, so they can get closer to how things were previously.’’ This approach adds a level of ambiguity that businesses are trying to avoid. As soon as data is extracted, it is subject to errors and becomes a second version of the truth. To avoid this mentality and get the most out of a GRC tool, users must think about how all teams will want to extract and view data to ensure this is possible within the confines of the tool. A thorough set up involving collaboration across departments during the implementation phase is essential to ensure everyone can view relevant information within the tool.
During implementation, you should engage staff of all levels. From management teams to those entering the data on the front line, organisations should carefully scope out the critical data they need to capture. They must understand how the data will be used and what reports it will appear in. They must select field headers and dropdowns wisely and consider all possible options. It is wise to look for a GRC tool that is highly configurable enabling you to add new fields and dropdowns yourself, without incurring additional set up fees from the software vendor. Look for tools that are intuitive and easy to use as this will save time on staff training and streamline processes in the data entry phase. Configuration in the implementation stage – is critical to a successful software rollout.
Keeping pace with change
If there’s one thing that is constant in business – it’s “Change”. Organisations are always looking to streamline processes, reduce costs and evolve to meet the demands of the market, so flexibility and configurability should be a key component of any GRC tool. Your GRC solution should be flexible enough to evolve and expand with your business, making configurability and links between different data sets a high priority for businesses as they strive to get more insights from their data.
When it comes to the regulatory compliance landscape, data governance in particular plays a vital role in ensuring businesses are consistently compliant with all levels of governing requirements. In short, an effective data governance strategy contributes significantly to an effective compliance programme.
As well as being high quality, data needs to be dynamic, and data practices need to evolve as the organisation and the business landscape develops. Much of the data for your risk & compliance programme will flow in from other departments, including Operations, Planning, Sales, and Finance teams. Getting a real-time view of this information alongside your traditional risk & compliance data is critical to build a holistic view of your overall risk profile. The right GRC software will support information sharing across the entire business, allowing you the luxury of pulling in data from other systems – via APIs – into your chosen GRC tool to ensure data is consistent and accurate across platforms. Users can also collect new data using GRC tools by launching forms, questionnaires, tasks, and projects within the software. Leaders can request frontline staff to complete the information, and built-in data governance rules will ensure data is captured in line with your data governance guidelines. This ensures everything is time-stamped and offers invaluable transparency. In turn this allows teams to gain insight into how and why the data they are providing is being used, further increasing the quality of data being supplied.
High-quality data also expands the use of BI dashboards and analytics tools, if analytical data is seen as trustworthy, decision-makers are more likely to rely on it instead of basing decisions on their own spreadsheets or worse yet their gut feelings.
It’s clear that at its core, data governance leads to improved data quality, decreased data management costs, and increased oversight for all stakeholders. The result? Dramatically improved decision making and better business outcomes for organisations – which in turn leads to healthier decision making and improved support across operations.
At Camms, we know from experience what a difference a best-practice GRC tool that prioritises data governance can make to a business. We are passionate about helping companies get the most out of their risk and compliance programmes and we know that accurate data is a critical component. Request a no-obligation demo of our industry recognised GRC solution to learn more.