- Arenas/Stadiums/Leagues /Entertainment
- Construction, Real Estate, Property Management
- Critical Infrastructure: Electric, Gas, Water
- Education: K-12
- Education: University
- Government: Federal, State and Local
- Hospitality & Casinos
- Hospitals & Medical Centers
- Ports: Sea, Land & Air
- Retail/Restaurants/Convenience Stores
- Transportation/Supply Chain/Warehousing
Risk intelligence is the final and probably one of the most important of the core elements which must be established when building a successful and effective enterprise risk management program. A comprehensive risk intelligence program is not only critical to the success of ERM programs, but it is vital to the viability, survivability and resilience of the entire enterprise.
Most folks in the past may have referred to this type of program as Business Intelligence, but the software industry has pretty much stolen that term and has applied it to mining the vast amounts of information housed in internal company databases.
Risk intelligence programs encompass the entire spectrum related to the collection and analysis of intelligence from the expansive environment of internal and external sources. It is vitally important to examine all of the risks, threats and hazards that may be encountered in the various environments in which the enterprise may operate. But, it is also just as important to maintain a holistic view and examine the opportunity risks that present themselves along the way.
Few intelligence programs exist in industry today that provide management with the depth of intelligence which allows them to make truly informed decisions. This void exists for a number of reasons. Most intelligence programs in industry are highly fragmented with no single point that collects and analyzes.
Industry shouldn’t feel like the forgotten step-child, however, as government intelligence agencies are themselves highly fragmented into what many refer to as “silos of excellence.” Inter-agency intelligence sharing has improved somewhat due to highly publicized past incidents of glaring intelligence failures. Those intelligence failures, in most cases, were traced directly back to agencies not sharing intelligence with other agencies or not grasping the relevance and importance of intelligence data they already had in their grasp.
Any form of real intelligence sharing by the government with the private sector is still virtually non-existent, in spite of the fact that industry has been listed as a legitimate consumer of intelligence in the government’s National Intelligence Policy since the early 1990s. The only truly notable exception has been the Overseas Security Advisory Council that has evolved as an effective partnership between the State Department and the private sector since being established in 1985. Most government agencies continue to balk at providing any form of meaningful intelligence to industry, despite policy guidance and Presidential Executive Orders that require them to do so.
So how does one go about establishing an effective risk intelligence program? The first step in developing a program requires an analysis of the corporate culture. Is the company structured as a centralized or decentralized enterprise? Is it an environment that is highly collaborative and cross-functional or are functions and business units operating in a highly stove-piped structure? A solid risk intelligence program can operate effectively in any of these environments, and its success is not dependent on one approach or another.
A truly successful risk intelligence program will only evolve, however, if the program has top-down support as well as bottom-up support. The program requires a leader who is highly collaborative, innovative, analytical and respected. It can operate as a standalone function within the enterprise or be staffed by representatives of key functions and business units from throughout the enterprise. Establishing a group of highly qualified analysts is absolutely vital. The next step is to gather requirements from within the organization…what information do business leaders need to effectively manage risks in their operations?
A world-class risk intelligence program gathers data on risks to people, assets and markets in its operations around the world. Intelligence can be gathered through social media, deep-dive Internet searches, news clipping services, conferences and trade shows, academic and research institute publications, industry publications and more.
The bottom line: It is one thing to gather data, but an entirely different thing to turn that data into meaningful and actionable intelligence. Intelligence must provide information that can be acted upon, if it is going to be deemed of value.
About the Authors:
Jerry J. Brennan is the founder and Chief Operating Officer of Security Management Resources (SMR Group), the world’s leading executive search firm exclusively focused in corporate security. Lynn Mattice is Managing Director of Mattice and Associates, a management consultancy focused at the development and alignment of Enterprise Risk Management and Business Intelligence Programs, as well as Intellectual Property Protection and Cybersecurity.