The future looks bright and promising for the GRC market for 2021 and beyond as stated by Quadrant Knowledge Solutions. With an expected annual growth of 18.5% over the next five years, to reach a record market size of $10,15B by 2025, the market is booming.
This impressive growth potential is presumably due to the Covid-19 crisis revealing that risks - environmental risks, cyber risks, financial risks, etc - could no longer be managed in isolation. Organizations witnessed, often painfully, that what started as a health and safety risk (the pandemic) had cascading impacts throughout their entire ecosystem affecting processes, IT, HR, third parties, etc., and that this risk accumulation could ultimately threaten the organization’s existence.
To make matters worse, on top of dealing with those unprecedented systemic risks, organizations had to cope with the rise of cyber risk, and an ever-complex regulatory landscape, not to mention their business-as-usual initiatives. We now can understand the urgent need for organizations to bring clarity to this complexity to help them navigate chaos as premonitory stated by GRC pundit Michael Rasmussen in his from September 2019!
A holistic view of the risk universe is now of the essence, meaning that the time to consider acquiring a GRC solution has never been so real, or even critical.
Indeed, Quadrant Knowledge Solutions reports that the purchase of GRC solutions is now considered a strategic investment by organizations. This is not a surprise as the pandemic has made risk management a top priority on every Board’s agenda. Organizations are looking for innovative solutions: their objective is to strengthen their defense strategy against internal and external threats, to preseve their integrity and withstand the next crisis looming on the horizon.
And with pandemic restrictions slowly fading away and investments in technology, especially those linked to security on a rebound, organizations are now actively looking for a GRC solution that will help them operate in an ever risk-prone environment, by federating sometimes disparate practices (IT, operations, risk management, compliance, supply chain, etc.) into one comprehensible vision.
Quick to comply with this new market demand, GRC vendors already started to adapt their functional module line-up accordingly - sometimes with a record time to market, made possible via the use of release through the application portal. For example, new capabilities including Vendor Risk Management, IT GRC/Security, and Business Continuity, have been delivered to help clients face the change, adapt their process and survive the pandemic, and sometimes at no additional cost. This scalable offering is now essential to delivering on the promise of a unified approach to risk management.
Before the pandemic hit, the GRC market was already on a steady growth pace, lately powered by the democratization of SaaS offering. This delivery option is now the most common and preferred choice in 61% of cases for financing a GRC acquisition, as reported by AMRAE in their <2020 RMIS Panorama. It is therefore not surprising that it accounts now for a sizeable 38% of total market share according to Quadrant Knowledge Solutions.
Technology advances, especially in cloud security and the use of hybrid cloud will probably continue to push this adoption rate even further especially among highly regulated organizations, which are often reluctant to switch to SaaS for security reasons.
As it is often the case in the software industry, the capacity of a vendor to advance technology through innovation and creativity can be a real differentiator. And the GRC market is no exception. Organizations are now considering GRC vendors not just as regular software suppliers but as strategical technology partners that can innovatively deliver cutting-edge innovations (AI, machine and Deep learning, RPA, Analytics, etc.). All this to help them manage an ever-evolving threat landscape, the rise and intricateness of regulations, and their own growing business complexities.
Most market vendors have the objective to deliver some form of innovations to varying degrees, either through self-development or through partnering. Depending on their technology sweet spot, some have developed core competencies in managing complex sets of data using AI and machine learning for example, while others have specialized in control testing automation for fraud detection and continuous monitoring.
The real challenges are when dealing with innovations remains to be able to deliver those seamlessly and through a superior user experience.
As a matter of fact, the importance of the user experience has grown dramatically over the last years and now weighs heavily in the final decision when selecting a GRC solution. Ease of use is now the number one selection criterion for new GRC purchase according to GRC 2020 in its State of the GRC Market research
The main reason being that vendors are dealing with a more and more digitally informed audience expecting the same level of usability they encounter daily when using mainstream applications on their laptop or mobile. The typical GRC users first want a streamlined interaction but will favor an “augmented” experience, with a solution that can provide them with intelligent risk insights through clever visualization. This to help them make better-informed decision swiftly.
Despite all its proven benefits, technology is not the only magic silver bullet to carry out an efficient GRC solution adoption. The human element remains one of the key success factors of a project through the implementation team. Everyone in the industry is aware of these many projects that failed or run overtime due to poor project management, high staff turnover, and lack of cohesion between the client and project team.
A GRC implementation is very similar to a journey that can be, depending on the scope, quite long and perilous. Therefore, it is critical to carefully choose the right travel companions. Unlocking the promises of a GRC solution requires a solid implementation team both on the vendor and client side, with strong management support, deep expertise, and a proven track record.
An interesting trend that has emerged recently, is the concept that GRC solutions are also instrumental for building trust with stakeholders (management, employees, partners, and the public) which is essential to protect the integrity of a brand image and especially build long-lasting public trust - especially at a time when social environments can change so quickly.
By helping companies achieve their efficiently objectives and manage their compliance to industry standards and regulatory requirements as part of their ESG program, and fostering a culture of integrity based on corporate social responsibilities and ethical business practices, GRC solutions demonstrate once more their relevance.
The interconnected and distributed nature of today’s business environment requires above all visibility and smart connections across the GRC spectrum, pushing organizations away from the traditional reliance on a patchwork of solutions to manage their regular risks and cyber risks. The time is now for a truly connected 360-degree view of risks.
MEGA is positioned as a Technology leader in the 2021 SPARK Matrix™ report among six other key players. This milestone represents a solid endorsement of our strategy to innovatively combine GRC, IT architecture, Business process modeling, and Data governance into one single platform. At MEGA international, this has been our guiding principle for many years and is probably the main reason behind our recognition as a leader in this space. This is an exciting time to be in the GRC market.