The global market for risk management software is anticipated to expand at a CAGR of 18% during the forecast period of 2024 to 2032. The fundamental objective of risk management software is to continuously monitor and manage an organization's numerous compliance-related risks. The software's major purpose is to identify a risk, limit its impact, and efficiently manage it. Moreover, the various advantages of risk management software, such as better decision-making, realistic expectations, escalation, and a focus on risk, are the lucrative factors driving market advancement.
Numerous nations' governments are focused on enhancing supply chain management. As a result of the government's policy implementation, the Indian Logistics Industry has enjoyed significant growth. To facilitate the movement of goods, the government will implement the National Logistics Policy in 2020. In addition, the advent of global pandemic diseases has raised the demand for Risk Management software to control supply chain risks in the healthcare and pharmaceutical industries, a trend that is anticipated to continue post-pandemic.
Risk Management software that incorporates cutting-edge technologies like as artificial intelligence (AI) and machine learning (ML) has the potential to expand the market and boost customer value. AI-based Risk Management has enhanced the efficacy of risk processing and can be used to expedite and automate processes such as load forecasting and vehicle scheduling. AI and ML can provide supply chain and logistics operations with benefits such as lower redundancy and risk reduction, faster deliveries via more optimal routes, improved forecasting, and customer service. The incorporation of new technologies and Risk Management software facilitates logistics management and enterprise risk management. An increase in investments and acceptance of these technologies offers promising market expansion possibilities.
Governments have imposed varying rules and regulations on various organizations regarding the implementation of enterprise risk management via a flexible, user-friendly information system that enables businesses to evaluate, identify, analyze, and consider both opportunities and risk in order to protect corporate brands and create value. In addition, the proliferation of risk management software is affected by the numerous rules and regulations enacted by governments in different countries. For example, the Singaporean government has created a new regulatory framework for the manipulation of financial benchmarks that includes both civil and criminal sanctions. In addition, according to a study done in China, the Chinese government implemented GRC (governance, risk management, and compliance management) solutions in companies to enhance risk monitoring, segregation of tasks (SOD) management reporting, and continuous control monitoring (CCM). In recent years, the market for risk management has presented a lucrative opportunity as a result of the varying regulations implemented by governments in various nations.
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Businesses that adopt software for risk management face security and privacy issues. Companies own sensitive information that must be protected from data breaches and cyberattacks. Compared to on-premises deployment, cloud adoption poses security risks because third parties maintain firm data and unauthorized users can access it. Increasing adoption of cloud-based deployment raises security concerns that endanger enterprise data protection and hurt business reputation, hence inhibiting adoption. Nonetheless, investments in cyber security software for data security are considered in order to overcome this challenge.
Developing economies are severely threatened by cyberattacks, fraudulent attacks, money laundering, terrorist operations, and data theft. Hence, risk management software use has expanded in developing economies. However, the substantial external foreign currency debt of a number of developing economies makes them susceptible to changes in interest rates caused by international exchange rate movements and currency attacks. This increases the adoption of risk management in these nations. In addition, developing economies have increased their spending on IT and digitization, which has led to a rise in a variety of security issues, such as data theft and cyberattacks. Thus, risk management software assists in reducing a variety of dangers, such as cyberattacks, financial fraud, and data theft, thereby offering a lucrative business opportunity.
The cloud segment held around 57% of the risk management software market in 2023. Cloud-based deployment offers real-time dashboard alerts to keep industries informed and current. With this configuration, data from several sources may be synchronized effortlessly, as it facilitates communication and data sharing more efficiently than an on-premise solution. In addition, the pay-per-use model and ease of deployment have contributed to the broad popularity of cloud-based deployment. Blockchain will be the key technology for regulated industries such as banking and law. Eradicating the risk of a single point of failure, blockchain technology enables the decentralized and distributed storage of data. The blockchain technology is capable of detecting data alteration. Venminder is the leading provider of third party risk management solutions. The startup raised $5 million in Round B funding. Financing was provided by MissionOG and Bain Capital Ventures. Venminder's SaaS-based platform is a great solution for all essential processes, such as contract administration, risk assessment, questionnaire creation, and task management. This cash will be utilized to establish a compliance platform for the organization. The implementation of Artificial Intelligence (AI) in risk management will have a substantial impact on how financial institutions manage risks. With the rise of AI and machine learning, it is anticipated that risk managers would shift their attention to analytics in order to avert losses.
Transport & Logistics is predicted to grow at a CAGR of 10.2% between 2024 and 2032, making it the segment with the greatest growth rate on the Risk Management Software Market. The use of Risk Management software for applications such as shipping history estimation, demand forecasting, and freight in transit is anticipated to stimulate market growth in this area. The rise of the transport and logistics industry can be attributed to the globalization of the supply chain and transport networks, which has led to supply chain risks such as a lack of supplier visibility, extensive subcontracting, natural disasters, and political unrest. Excessive subcontracting may lead to integrity difficulties, such as underage or forced labor, hazardous working conditions, and illegal worker payment. These challenges have caused transport and logistics companies to prioritize the development of Risk Management systems to assess risk or security assessment, failure mode and effects analysis, market conditions, and supply chain resilience risk mapping. In addition, a number of countries, like India, South Korea, and others, are establishing Risk Management systems to identify, evaluate, and prioritize risks. The Indian government is supporting the logistics industry with major initiatives. In 2019, the Indian Ministry of Commerce and Industry provided $0.011k for the development of early infrastructure in the logistics sector. This initiative provides opportunities for market expansion.
Due to its early adoption of new digital technologies and considerable investments in their deployment, North America dominated the Responsible Sourcing Software market in 2023, with a 37% market share, followed by Europe and APAC. The use of Risk Management software is pushed by the existence of several manufacturing facilities and large retail chains. In 2018, the Federal Electricity Regulatory Commission (FERC) of the United States implemented new mandatory dependability standards for the safety of transportation and logistics equipment and to boost Risk Management in the industrial sectors. Due to the impact of covid-19 in 2020, the market in this region is driven by strict regulations in manufacturing industries and strict adherence to these requirements.
Principal Risk Management Software Market strategies include the introduction of new technologies, acquisitions, collaboration, and research and development (R&D). Risk Management Software market leaders include SAP, Oracle, IBM, The AnyLogic Company, SAS Institute Inc, ServiceNow, RSA Security LLC, Thomson Reuters, Lockpath Inc, and LogicManager Inc.
Acquisitions/New Technologies
