Establish a Roadmap for Integrated and Dynamic Risk Management

Evolve risk management capabilities to tackle emergent technology risks.

Introduction: What is Exponential IT?

• The technology curve has recently bent exponentially.
• Generative AI has been the catalyst for this sudden shift, but there are more and more new technologies emerging (e.g. quantum computing, 5G), putting significant pressure on all organizations.
• All IT leaders and organizations are at risk of falling behind if they do not adopt new technologies fast enough.
• Exponential IT is a framework defined by Info-Tech Research Group to instruct IT leaders across all IT domains on how to transform their organization and elevate their value creation capabilities, to close the gap between the exponential progression of technological change and the linear progression of IT's ability to successfully manage that change.
• This blueprint provides guidance on establishing integrated and dynamic risk management by evolving and autonomizing previously siloed risk capabilities and practices.
• CIOs or delegates can use this blueprint to partner with the Chief Risk Officer or delegates in developing a roadmap to evolve the risk management capabilities of the organization.

Your Exponential IT Journey

To keep pace with the exponential technology curve, adopt an Exponential IT mindset and practices. Assess your organization's readiness and embark on a transformation journey.

Adopt an Exponential IT Mindset
Info-Tech resources: Exponential IT Research Center, Research Center Overview, and Keynote

Explore the Art of the Possible
Info-Tech resources: Exponential IT research blueprints for nine IT domains

Gauge Your Organizational Readiness (Repeat annually)
Info-Tech resource: Exponential IT Readiness Diagnostic

Build an Exponential IT Roadmap (Repeat annually)
Info-Tech resource: Develop an Exponential IT Roadmap blueprint

Embark on Your Exponential IT Journey (Focus of this blueprint)
Info-Tech resource: Establish a Roadmap for Integrated and Dynamic Risk Management

To access all Exponential IT research, visit the Exponential IT Research Center Go to this link

Analyst perspective

Evolve organizational risk management capabilities to tackle emergent technology risks.

In the rapidly evolving landscape of IT led by emergence of technologies such as generative AI, quantum computing, and 5G all IT leaders risk being left behind if they are not able to adopt these technologies fast enough to support their organization. These technologies, if implemented correctly, bring a plethora of opportunities, but they also bring enormous risks.

Traditional risk management systems and capabilities, which rely on siloed, manual risk processes and uncoordinated responses with insufficiently defined risk accountability and risk data, are simply not good enough to take on these emergent technology risks.

As such, IT leaders, along with their enterprise risk counterparts, must make the shift to a dynamic, interconnected and proactive approach to risk management, including integrating IT risk with enterprise risk practices and elevating risk management's status to that of a strategic enabler to help the organization stay competitive and resilient in the face of new risks.

Since risk from emerging technologies will be nonlinear and harder to predict, risk management will need to be adaptable and nimble enough to address the unknown. The use of artificial intelligence (AI) and similar emerging technologies to manage, identify, and address convergent risks multiple material risks coming together in unexpected ways will be one of the most important AI use cases due to the unpredictable nature of emergent risk.

Exponential IT is a framework defined by Info-Tech Research Group to instruct IT leaders across all IT domains on how to transform their organization and elevate their value creation capabilities, to close the gap between the exponential progression of technological change and the linear progression of IT's ability to successfully manage that change.

This blueprint provides guidance on establishing an integrated and dynamic risk management system by continuously evolving and eventually autonomizing the majority of the previously siloed risk capabilities.

Anubhav Sharma
Research Director
Info-Tech Research Group

Blueprint taxonomy

This research uses the following common terms:

Integrated and dynamic risk management
Fully integrated and dynamic risk practices across the organization that break down organizational risk management silos and improve speed of risk response especially in case of unknown material risks driven by AI-enhanced tools and enterprise-level risk data sets.

Risk tolerance
Tolerances apply to specific objectives and provide guidance to those executing on a day-to-day basis. They measure the variation around performance expectations that the organization will tolerate.

Value outcomes
The outcomes of implementing the roadmap developed through this blueprint, which will result in greater organizational resilience in face of new risks, e.g. adaptability, IT-enterprise integration.

Risk appetite
The amount of risk an organization is willing to take in pursuit of its objectives.

Risk capability
An aspect or ability of an organization's risk management system that when combined with other risk capabilities, helps the organization to manage its risk, e.g. risk culture, risk skill set.

Milestone
A defined level or maturity of risk capability an organization's risk capabilities exist in. It helps identify an organization's current state and the target state needed for that particular risk capability.

What is integrated and dynamic risk management?

• Integrated and dynamic risk management is the process of ensuring all forms of risk information, including risk related to information and technology, are considered and included in the organization's risk management strategy and the organization can pivot fast and respond with speed to risks.
• It removes the siloed approach of classifying risks related to specific departments or areas of the organization, recognizing that each risk is a potential threat to the overarching enterprise.
• By aggregating the different threats or uncertainties that might exist within an organization, integrated and dynamic risk management enables more informed decisions to be made that align to strategic goals and continue to drive value back to the organization.
• By holistically considering the different risks, the organization can make informed decisions on the best course of action that will reduce any negative impacts associated with the uncertainty and increase the overall value.

Integrated and dynamic risk management: Fully integrated and dynamic risk practices across the organization that break down organizational risk management silos and improve speed of risk response especially in case of unknown material risks, driven by AI-enhanced tools and enterprise-level risk data sets.

Drivers and benefits of integrated and dynamic risk management

Drivers for integrated and dynamic risk management

Rapid increase in use of emerging technologies

The breadth and number of risks that are interconnected and require oversight

The need for faster risk analysis and decision-making

Benefits of integrated risk management

• Enables better scenario planning
• Enables more proactive risk responses
• Provides more relevant risk assurance to key stakeholders
• Improves transparency and comparability of risks across organizational silos
• Supports better financial resilience
• Enables faster response time
• Will enable utilization of AI for managing risks, improving risk capabilities

The velocity and complexity of risks due to use of emerging technologies such as AI are making integrated and dynamic risk management a necessity, which can only be possible if we succeed in using AI well to enhance risk management processes.