Enterprise Risk Management in the Fourth Industrial Revolution

Enterprise risk management in the fourth industrial revolution is a hybrid approach where information is collected in a hybrid manner rather than either the bottom-up or top-down approaches. We argue that, however, whilst the hybrid approach addresses the information leaks, it will be prone to complexities, and could lead to delays. However, it should still be seen as an enhancement traditional approach. As data become comprehensive and complex, the traditional enterprise risk management process would not be helpful in terms of speed, power, and accuracy. Enterprise risk management in the fourth industrial revolution would, for instance, adopt big data analytics tools. Big data analytical tools could be machine learning algorithms. These tools can be utilised to deal with the comprehensiveness and complexity of information. The strength of machine learning is in discovery. Another advantage of machine learning is its ability to find valuable underlying patterns within complex data, which would be a difficult task for traditional enterprise risk management, which heavily relies on human agents. Human agents are prone to boredom and loss of concentration, which on its own could result in the process being plagued with errors. It is important to understand that data may mean structured, semi-structured, or unstructured data. Some of the risk data emerging from the hybrid approach could contain a lot of textual information. We believe that the natural language processing would have an important role to play. Enterprise risk management in the fourth industrial revolution would deploy various techniques of the natural language processing such as text classification, sentiments analysis, named entity recognition, summarisation, topic modelling, stemming, and lemmatisation. There are various complexities within an enterprise. One of the complexities is enterprise processes. Different divisions of the enterprise could have different processes that are deployed. A human aggregator may miss the crucial information emerging from some of these processes. Enterprise risk management in the fourth industrial revolution would utilise robotic process automation. The adoption of the robotic process automation would also be an important step for addressing repetitive tasks.