Risk Management Consulting is a great business to be in, and clients have never needed you more. The analysis, monitoring, mitigation and treatment of risk is at the core of creating a resilient organisation.
You’ve worked hard to build a reputation of professionalism, competence and the ability to respond quickly to a client’s newly emerged risk. But what happens when that risk is mitigated and the client is not calling you?
You’ll have periodic or annual assessments. Or the client will call whenever they have a new site coming on line. These client relationships are good because they do generate repeat revenue, but that’s not the same as recurring revenue, where the client is paying you every month on long term contracts.
You will likely have existing recurring revenue in the form of embedded consultants, advisors, security assets, etc. And if that is the case, the question is, how do you make these contracts more valuable both to the client and to your business? And how do you increase your retention rate and move the discussion away from price at renewal?
It might be useful to use an example - let's say Global Hotels Inc with nearly 600 hotels across the world. How many different audits, compliance checks, surveys, risk assessments, mystery visits and other ad-hoc site reports are generated in a year? The number must be in the many thousands. The majority of these docs will reside in spreadsheets, reports and be stored on paper or in shared drives. They are probably looked at once or twice and then consigned to gather dust for the next x years.
There is a solution to enable clients to capture all of this kind of observed status/performance information directly from your consultants via smart devices (phone, tablet/laptop) and transfer it to a secure cloud environment. More detailed assessments can be completed in two or more stages with initial data acquisition on site and later, deeper review data being added from a laptop The structure and the governance of the data is absolutely critical so that it may be used for purposeful analysis and result in good management decisions - made easier by advanced dashboard analytics - even including machine learning predictive analytics.
The benefits are significant with Risk Management consultants now being in a position to analyse risk across hundreds of sites in seconds, sharing this with clients to drive out decisions leading to cost reductions, compliance improvements, management corrections, changes in resource allocation, etc. Of use as well is that the solution will reduce the time it takes for consultants to produce reports. Another significant benefit would emerge with large banks of performance data developing over time. It would become easy to monitor site, region, type of site etc progress/trends over time. It would also become possible (subject to clients agreeing to the use of their anonymised data) to chart for clients where they sit against industry norms of risk/compliance performance - finally bringing data to a big challenge for corporates as they seek to decide on their risk appetite/resource allocation.
I can see an opportunity for Risk Management Consultants to integrate solutions like this (possibly on a white-label basis) into an offer for clients that may include features such as:
Periodic, expert reviews - these are deep dives (and may be driven from a calendar or needs basis)
More regular surveys - observing tactical performance measures such as physical security, access control, maintenance, etc
Enable client personnel to self-assess against agreed performance metrics
This creates a 360 degree view of risk performance, where expert resources are optimised, the buy-in and knowledge of site management is captured and leveraged, and recurring revenue is secured. You can even integrate other data sources e.g. monitor threat data against your controls dynamically.
Building the proportion of high-quality recurring revenue in your sales mix is critical to drive value. Secondly, recurring revenues create more regular client engagement opportunities, and these are always a good thing. More engagement = better relationships = more trust = more work.
So reach up into the cloud and grab yourself some big handfuls of risk management recurring revenue.
Adam Miller is a risk management professional and an advisor to TabSys - the leading SaaS solution for risk and compliance performance assessments.