5 ways outsourcing can help organizations manage risk
INSIGHT ARTICLE |
Every organization has unique business needs and requirements to effectively manage risk. A company’s risk tolerance for any one factor could vary based on industry regulations, business models, geographic footprint, workforce size and other considerations. In many cases, an organization’s risk management strategy can be strengthened with the help of an experienced managed service provider that offers high-skill, in-demand services to help manage and mitigate risk.
Wondering what outsourcing could do for your organization? Following are five examples of how managed service providers can help you manage risk.
1. Filling skills gaps that can make you vulnerable
Organizations often choose to outsource because they don’t have or can’t find the necessary skillsets internally or because hiring employees with the relevant skillsets is just too expensive. For mission-critical capabilities, such as ensuring the reliability of core applications and protecting systems and data against cybercrimes, a gap in skills makes an organization more vulnerable to business disruption, non-compliance and criminal acts. With cybercrime on the rise in small and midmarket companies, many are fighting back by working with a managed security service provider.
Another area of risk where companies frequently seek outside assistance is audit. A shortage of auditing capabilities—or ineffective manual processes in auditing—can introduce risk while negatively impacting productivity, efficiency and standardization throughout your audit process. Today, risk management advisors can leverage process automation solutions to transform internal audit, compliance and risk management programs to maximize value and improve overall efficiency and effectiveness.
In cases like these, an effective risk management plan to monitor and mitigate your information technology risks could include managed IT services, managed security services, managed application services and virtual CISO services.
2. Bringing in deep experience regarding potential risks and solutions
The ability to benefit from outside expertise is one of the key advantages of outsourcing. Experienced managed service providers have often had hundreds of engagements not just with clients in the same industry as yours but also with varied organizations in different industries.
This wide-ranging experience allows providers to bring insights that are directly relevant to your company, your business environment and your risk profile. In addition, drawing on the extensive knowledge they’ve gained implementing successful solutions in a variety of settings, industries and situations, managed service providers can see potential risks your organization may not recognize and recommend new and more effective ways to protect your organization’s systems and assets.
The right managed service provider should also be able to demonstrate deep knowledge of, and experience with, your organization and industry’s specific business management and business functions. Selecting a provider with this expertise helps to ensure there won’t be a long learning curve. Instead, your provider can hit the ground running on the first day.
Finally, a strong provider should deliver data-driven assessments for common risk challenges based on information from their anonymized data. This wealth of real-world knowledge can enhance your organization’s vulnerability monitoring and provide robust data protection.
3. Providing predictable around-the-clock service
Managed service providers can deliver on-demand, cloud-based services 24/7, which can be essential for critical concerns such as application availability and security. These days, few middle market companies can afford to set up and staff 24/7 positions on their own, but such positions have become essential for businesses of all sizes. For instance, while larger enterprises may have been the primary target of hackers in the past, today, small and mid-sized firms are common targets of cybercrime as well.
If insourcing these 24/7 roles is unaffordable for your small or middle market organization, outsourcing can help make them affordable. For example, a managed security service provider can help your organization reduce cyberrisk by setting up a comprehensive solution to protect all your organization’s systems, whether they’re on premise or in a private or public cloud.
4. Scaling services to improve security and capture value
Whether your organization needs to scale systems due to organic growth or a merger or acquisition, outsourcing can enable the faster stand-up of new systems and applications to maintain security and capture value. For example, a provider with a wide portfolio of managed service offerings can help with transaction management for an M&A, develop a business process integration plan, quickly stand up the newly integrated systems for that plan and provide IT managed services and consulting over the life of the systems.
Outsourcing to a managed service provider not only streamlines your expansion, but it can also make sure systems are protected more quickly than your organization can usually do on its own. For instance, a managed security service provider could train your employees to recognize malicious emails and websites as part of end-user security awareness training, or they can implement multi-factor authentication (MFA) for advanced security, quickly allowing remote access to business applications.
5. Enabling secure agility for never-ending change
To be cost-effective in today’s globally and digitally linked economy, organizations must respond to change quickly and without the risk of disruption. Change can be driven by a range of factors, including customer behavior; economic, social or environmental events; or new standards and regulations.
Managed service providers with industry-specific business experience and a large portfolio of services can help support organizational agility by providing new or expanded services as needed. For example, the recent pandemic triggered a host of new requirements for workplace safety. Many companies turned to managed service providers to help them quickly build applications to communicate and execute the new safety rules. Such digital solutions can be spun up rapidly with the help of an always-on provider.
The unexpected absence of a critical role, such as an IT leader, is another change that calls for agile solutions. In this case, the problem could be solved by engaging managed IT services and/or hiring a virtual IT leader for a specific period of time. This approach eliminates downtime, facilitates rapid response and is more cost-effective than using internal resources to search for a temporary replacement.
Risk management challenges and solutions
Managing risk is an ongoing challenge in today’s ever-changing business environment. However, many organizations lack the internal skills, knowledge and resources required for comprehensive risk management. Outsourcing to an experienced managed service provider can help.
A strong managed service provider and risk advisor can identify potential risks, help your organization scale securely, facilitate an agile response to change and provide the 24/7 protection that companies of all sizes need to mitigate risk. In a complex business landscape, outsourcing offers an efficient, cost-effective and nimble solution for managing risk.
Do you want to learn more? Listen to our podcast to discover how internal audit outsourcing can help organizations mitigate risk.