In Risk Is Not a Quarterly Exercise; It Should Be a Way of Life Norman Marks asks an interesting and pertinent question:
Is your risk management program a quarterly exercise or a way of life in the business?
One of the most uses of analytics is in risk assessment – predicting fraud or credit risk for instance – but this only works when risk management is embedded into your day to day operations. After all, risk is acquired one transaction at a time. In Norman’s example, one journey at a time, but for many companies one customer, one deal, one loan at a time. Unless you have a way not only to assess that risk, but to do it for that transaction at the moment you are considering it, you will not be able to make a decision that is appropriate to the level of risk involved. If all you can do is consider the risks you have acquired in the last day or last week or last quarter then it will be much too late.
Assess risk in the transaction, at the moment, by applying analytics to the operational decisions embedded in that transaction.