Challenge: Risk Solutions
At the start of 2014, Nationwide’s Customer Services and Operations (CS&O) team launched a review of its risk management and control systems. Its aim was to create a more holistic view of risk, by taking in more granular information, which may potentially have been slipping under the radar.
The team found that established technology, while effective at identifying larger risks, didn’t give them the option to track smaller incidents. As a result it embarked on an 18-month project to develop a bespoke Fintech solution with its established technology-partner Styles&Wood Group.
The resultant system – Artick GRC – is a comprehensive governance, risk and compliance control platform that is now used by Nationwide’s 4,500-strong CS&O team on a daily basis. It ensures it remains compliant with risk legislation and underpins its long-term aim of reducing its exposure to risks.
Like other financial services brands, Nationwide already had processes in place to monitor and report on high impact risks. What it lacked was a way of recording risks and incidents that fell below the threshold for group-level reporting, but would provide valuable insight into its total risk environment.
It recognised that being able to record and aggregate smaller high frequency but low impact events, would provide meaningful data for senior management. This would be particularly useful in spotting trends within risk that could add up to larger issues in future, allowing it to make early interventions
The use of a live dashboard ensures a consistent approach to how risk is captured and monitored, with each team member responsible for logging incidents.
Acknowledging that logging incidents are an added task for the CS&O teams, a key challenge was ensuring that using the system was intuitive and would not create bureaucracy. Arctick was developed with tabbed screens that can quickly take a user through the risk management cycle step-by-step including only relevant questions. This has helped employees better understand the risk process, and why it’s important while minimising their time recording risk.
This has removed the wider assumption that the risk team was solely accountable for logging and managing issues – ensuring that compliance with the three lines of defence model is adopted in practice. The user-friendly nature of the system has also led to increased awareness of every employee’s accountability and encouraged better self-assessment and reporting of individual’s own incidents.
In addition to logging incidents, the software automatically collates the required documentation, where different managers have taken action, and when the issue has been resolved. This gives Nationwide a robust audit trail that ensures that all information can be called upon when needed.
A key part of the risk management process is assessing the potential financial implication of issues. At any time the system can be used to automatically generate a risk profile for the CS&O team. It also allows Nationwide to extrapolate the potential costs of individual risks, as well as the effects of multiple issues.
Through the combination of automation, and an intuitive, user-friendly interface, the introduction of the system has led to an increase of 200 per cent in the number of logged incidents.
Arctick has also provided new methods of monitoring and reporting on the risk environment, overlaid by a new suite of KPIs, to spot developing trends and crystallising issues.
After the success of the system in the last year, Styles&Wood and Nationwide have developed the system for others in the sector and together have recently brought it to market.