Demand for risk management software is on the rise but the majority of users believe it lacks innovation to help them do their job, finds the latest study by French risk management association AMRAE.
The 13th edition of Panorama SIGR, an analysis of the risk management software market published every year by the association, also reveals that almost 60% of risk managers surveyed feel the interface between risk software and other company IT systems is not ideal and 45% said reporting tools do not meet expectations.
The report is based on a survey of 49 risk management software providers, ten of which participated in it for the first time, and a poll of 230 risk managers in France and other countries. Risk management associations such as Ferma, Rims in the US and Asia’s Parima also contributed to the study.
It found that 71% of risk managers are satisfied with the specialist risk management software used by their companies. However, six out of ten said the software lacks innovation to meet their full needs.
But Bertrand Rubio, an associate partner at EY Consulting, which helped Amrae produce the report, said it is not clear if many risks managers are ready to fully embrace such innovation and new technologies including artificial intelligence (AI).
The authors also note that two thirds of products available today offer the capability to work with APIs that can facilitate information sharing among different departments. But again they state that only a few risk managers seem able to employ such sophisticated tools currently.
However, any shortcomings in risk technology do not seem to be affecting its popularity among risk management departments. According to Amrae’s survey, there was a 52% increase in the number of tenders for specialised risk software, despite the global economic crisis.
In fact, Amrae believes that the growing digitalisation of business operations will boost the use of technology by risk managers. The authors predict that as risk management software spreads, new products should emerge to help deal with ESG risks and better manage insurance programmes.
According to Hélène Dubillot, AMRAE’s science coordinator, the “main challenge for software providers is to take into account the changes that the crisis has triggered within organisations”.
François Beaume, a vice-president of AMRAE and vice-president of risks and insurance at Sonepar, said the pandemic has highlighted that risk managers need tools that help them gather and report vast amounts of information in an efficient way, and risk management software must be up to this task.
The survey also found that acquiring risk management software is often carried out by several different departments, as organisation try to break down information silos.
It shows that heads of risk management are the spark to buy risk software in 92% of cases. But internal controllers, auditors and heads of compliance are involved in more than half of all tenders. Similarly, the survey found that IT departments took part in 41% of tenders this year, compared to 5% in 2019.
However, heads of insurance are less involved in buying these tools. They were involved in 35% of all risk management software purchases in 2019 and 46% in 2018, but the ratio dropped to 24% in 2021.
The report delivers a detailed analysis of all 49 companies that answered the survey and includes contributions from a dozen risks managers and experts on data privacy and other issues.
It can be downloaded for free from AMRAE’s website. It is currently available in French only, but an English version should go live in September, the association said.