SAP Risk Analysis


What Is Risk Analysis?

Risk analysis is the assessment of potential risks on the business or market and the likelihood of adverse effects from those events. In a supply chain context, for example, companies model various disruptions to determine their impact and apply risk mitigation strategies to avoid them.

According to Investopedia, risk analysis can be divided between two types: qualitative and quantitative.

Qualitative analysis: Qualitative analysis incorporates a definition of uncertainties, evaluation of the potential impacts, and risk mitigation measures. Examples include SWOT analysis and cause and effect diagrams.

Quantitative analysis: Quantitative analysis relies on statistical modeling and assigning numeric values to potential risks. Within a risk model, those values produce graphical outputs to help determine risk mitigation strategies.

Through both risk analysis approaches, companies can glean an holistic view of their risk profile.

What Is Risk Analysis?

Risk analysis is the assessment of potential risks on the business or market and the likelihood of adverse effects from those events. In a supply chain context, for example, companies model various disruptions to determine their impact and apply risk mitigation strategies to avoid them.

According to Investopedia, risk analysis can be divided between two types: qualitative and quantitative.

Qualitative analysis: Qualitative analysis incorporates a definition of uncertainties, evaluation of the potential impacts, and risk mitigation measures. Examples include SWOT analysis and cause and effect diagrams.

Quantitative analysis: Quantitative analysis relies on statistical modeling and assigning numeric values to potential risks. Within a risk model, those values produce graphical outputs to help determine risk mitigation strategies.

Through both risk analysis approaches, companies can glean an holistic view of their risk profile.

SAP and Risk Management

As more companies migrate to SAP S/4HANA, it’s critical that their risk strategies are integrated within the system. SAP provides risk management solutions that put governance, risk, and compliance at the forefront of business activities.

According to SAP, “stakeholders want to see evidence, on demand and in real time, that an organization which they are backing is managing their financial, social, and environmental activities efficiently, profitably, and responsibly … Any risk management measures must focus on the specific value drivers unique to the business, and these can be difficult for you to identify. Managers must look beyond financial line items to the activities and processes that are integral to the organization’s business model.”

Further Resources for SAPinsiders

Building More Effective Access Control Through Business-Centric GRC. In this article, learn how companies are utilizing access control solutions to identify risk within their user base. These solutions and processes are often technical and driven from audit and IT perspectives with very little input from business users who might find the technical GRC language hard to decipher. That’s where the idea of business-centric GRC comes into play for access control — providing the business with easier to understand, less technical language so that they can better interpret the data.

Application Security Imperiled by Attackers. Application security is being threatened by cyberattacks on the application layer, such as SAP S/4HANA systems, which target valuable resources organizations store there. In this article, learn about new security concepts necessary to protect the “crown jewels” stored in SAP systems. Companies need to deploy real-time detection and response to deal with the rise in attacks against the SAP application layer level.

Vendors that can help SAP customers with risk analysis include: Appsian Security, DXC Technology, EcoVadis, and Onapsis.

818 results

  1. Identify Your Key Business Risks in a Collaborative Process Involving All Stakeholders in Your Enterprise

    Reading time: 14 mins

    Learn about the second phase in the enterprise risk management (ERM) process, risk identification. The knowledge about your business risks is spread across your organization and lines of business. A collaborative approach is required to identify and document all risks threatening your enterprise involving many different stakeholders. Discover how SAP BusinessObjects Risk Management 3.0 provides…...…

  2. Effectively Respond to Your Business Risks and Evaluate Residual Risk Levels

    Reading time: 14 mins

    Examine the fourth phase of the enterprise risk management (ERM) process: risk response allocation. See how in SAP BusinessObjects Risk Management you can distinguish between various response types and involve response owners in a collaborative process to increase accountability for response implementation. In addition to assessing response completeness and effectiveness, you can conduct a residual…...…

  3. Use the Integrated Approach of SAP GRC 10.0 to Remediate Operational Residual Risk

    Reading time: 21 mins

    Mitigation controls in SAP GRC 10.0 enable you to respond proactively to operational risks. See how several SAP GRC 10.0 integration scenarios can be used in response to the operational risk of fraud and money loss in the procure-to-pay (P2P) process. Key Concept SAP GRC 10.0 helps your risk management department put in place on-time…...…

  4. Start Your Enterprise Risk Management Process with Diligent Risk Planning

    Reading time: 13 mins

    More and more, companies are recognizing the relevance of solid risk management to protect themselves from diverse threats and increase the success rate of their strategies and initiatives. The enterprise risk management (ERM) process can be divided into five phases: risk planning, risk identification, risk analysis, risk response allocation, and risk monitoring. Learn about how…...…

  5. Set Up Risk Indicators as an Early Warning System and Leverage Actionable Reports for Risk Monitoring

    Reading time: 15 mins

    A risk monitoring framework delivers actionable alerts and reports that support decision makers in managing risk responses. It includes automated key risk indicators (KRIs) that trigger early warnings, meaningful reports of the current risk status, and records of risk incidents and losses as lessons learned. Learn how to set up KRIs in SAP BusinessObjects Risk…...…

  6. How to Validate Segregation of Duties Results

    Reading time: 20 mins

    Upon first running segregation of duties (SoD) reports in SAP BusinessObjects Access Control, management staff can become overloaded with data and assume that the results simply cannot be correct. It is then the responsibility of the owners of SAP BusinessObjects Access Control to prove that the reports are accurate. Step through the process that SAP…...…

  7. Reduce Costs in Compliance Management with a Top-Down, Risk-Based Scoping Approach

    Reading time: 15 mins

    With the requirement of identifying and assessing the design and operating effectiveness of internal controls many companies have ended up producing too much documentation and performing more testing, resulting in increased costs of compliance. Regulatory agencies such as the US Securities and Exchange Commission and the Public Company Accounting Oversight Board (PCAOB) encourage companies to…...…

  8. Manage Supply Chain Risks with SAP Supply Chain Performance Management 2.0

    Reading time: 12 mins

    SAP Supply Chain Performance Management 2.0 offers extended performance and risk indicators in a number of key areas, including the Supply Chain Council’s Supply Chain Operations Reference (SCOR) model. Learn how to effectively map these key risk indicators to an enterprise risk management program using SAP Supply Chain Performance Management 2.0 and SAP Risk Management…...…

  9. Define Risks and Functions with Risk Analysis and Remediation Rule Architect

    Reading time: 14 mins

    Discover the makeup and functionality of Rule Architect within SAP BusinessObjects Access Control Risk Analysis and Remediation. Key Concept Risk Analysis and Remediation (RAR) is part of SAP BusinessObjects Access Control. This capability helps all key stakeholders work in a collaborative manner to achieve ongoing segregation of duties (SoD) and audit compliance at all levels…....…

  10. Get Your System Clean with Risk Analysis and Remediation

    Reading time: 15 mins

    Become and stay Sarbanes-Oxley compliant with Risk Analysis and Remediation. Learn about its main features, technical architecture, and setup. Key Concept SAP GRC Access Control delivers controls that identify and prevent access and authorization risks in cross-enterprise systems. The controls prevent fraud and reduce the cost of continuous compliance and control. SAP GRC Access Control…...…