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Understanding GRC and its importance

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GRC has become an inescapable term in the world of business – it is talked about at conferences, in blogs, white papers, studies, and magazines. There is however still a lack of clarity when it comes to understanding GRC among many people. GRC may seem confusing at first but once we look at what it is, where it came from, and what it aims to do, there will be no mystery left.

What is GRC?

GRC is a new model of managing several aspects of an organization, notably governance, risk, and compliance. Every organization must ensure that it is in compliance with the regulations and laws that apply to it. Every organization must ensure that it is managing its risks properly. Every organization must also ensure that its governance is as efficient as possible. Under the GRC model all three are managed at the same time to achieve the same goals. This results in a boost in productivity and efficiency.

Why is GRC important?

GRC is important because it increased efficiency across the organization by a significant margin. Organizations that manage risk, compliance, and governance separately end up running into two major problems. One problem is that their efficiency and productivity is low. Since three similar and interconnected factors are being managed separately there are many redundancies. This increases costs for management.

The other even bigger problem is that risk, governance, and compliance are intertwined but when managed separately the links between them are not clear. Any issue that occurs in compliance will directly increase risk but if risk and compliance are being managed separately this will not be visible to management. The same is true for governance – good governance results in higher levels of compliance and lower risks.

When the GRC model is implemented with the aid of GRC technology the whole scenario changes. Now the compliance management system, the risk management system, and the governance of the organization are all on the same page. This removes redundant tasks and processes and lowers management costs. It also raises the levels of compliance, lowers risks, and improves governance.

How does GRC work?

Now that we understand what GRC is trying to do let’s look at how it accomplishes its aims. GRC tools doesn’t just manage governance, risk, and compliance at the same time, it also allows them to communicate with each other. If there is a vendor issue, which would fall under governance, that can affect compliance or risk, then the issue is also reflected in the compliance and risk management system. The same is true for issues in risk or compliance – their effects on the other factors are immediately visible.

Most GRC solutions also include automation. Compliance monitoring is almost completely automated, risk management and prediction is automated to a large extent, and so on. This speed up GRC processes and allows organizations to quickly detect, identify, and resolve any problems that may occur.

Why is GRC becoming popular now?

GRC is becoming popular now because the technology to power it is ready. Aligning risk, compliance, and governance is only possible when they are being managed digitally. If they are being managed manually there is no data or information which can be used to create a GRC solution.

GRC has exited as a concept for more than 15 years now – organizations understood a long time ago that better synergy between different departments and business processes results in better results for the organization. They were, however, limited by the lack of any practical tools to bring governance, risk, and compliance together. The advent of ERP solutions changed the game – organizations began to use digital systems to improve management which resulted in a lot of data being generated. This availability of this data makes GRC possible.

Where should I start with GRC?

The best way to understand something is to experience it. You do not have to spend a lot of money to experiment with a GRC solution. Look for a cloud based GRC solution that has trials available. Apply for a trial and you will be able to get access for a month without any payment. See what the GRC solution can do and what benefits it can provide for your organization by playing around with the GRC solution yourself.

GRC is no longer an expensive or hard technology to implement, thanks to cloud systems. It isn’t a trend and it isn’t a fad – it is simply the most efficient way of management, which is why we are going to be using the GRC model for a long time.

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