Protect Your Brand: Top Key Risk Indicators To Monitor
Key performance indicators (KPIs) measure the success and performance of your marketing efforts. Conversely, Key Risk Indicators (KRIs) or "Risk Metrics" focus on identifying and monitoring potential risks and challenges.
These are elements that could impact your marketing strategy and the business overall.
With social media, regulations, security, and privacy playing a more significant role in daily business activities, monitoring a few areas that could potentially set you back is an essential aspect of modern business operations.
Before implementing a method to measure, it's not a bad idea to define what would constitute a good KRI for your business:
- The first step would be to identify the organization's various risks based on their likelihood of occurring.
- Outline the operational and financial impact on the firm and its readiness to mitigate the event.
- Rank the business attributes in terms of their criticality to the firm.
- Rank the risks, threats, and vulnerabilities in terms of potential harm to the firm.
Key Risk Indicators To Monitor
Compliance and Legal Risks
Ensure your marketing activities comply with all the relevant regulations and laws in your country and state of incorporation. Metrics such as regulatory violations, compliance breaches, and fines or penalties imposed help you identify compliance risks such as regulatory risk, legal risk, and reputational risk.
These include metrics such as social media sentiment, media coverage, and brand recognition. Negative reviews, social media backlash, or public relations crises can significantly impact your brand's image. Data breaches or mishandling of customer information can result in reputational damage and legal consequences.
KRIs would be measured regularly, such as daily, weekly, or monthly, allowing you to identify potential problems early on.
Data Security and Privacy
Protect customer data and ensure compliance with data protection laws (e.g., GDPR, CCPA). This KRI measures the number of attempted cyber attacks on an organization's systems or networks. It helps to identify operational risks related to cybersecurity. Some incidents that may occur include:
- Data Breaches
- Unauthorized Access Attempts
- Phishing and Social Engineering Attacks
Assess the financial risks associated with your marketing activities, such as overspending on ad campaigns, underperformance of investments, or budget overruns. Other areas of financial risks stem from business-facing monetary policies that affect liquidity ratios, debt-to-equity ratios, and profitability ratios. They help identify financial risks such as credit, market, and liquidity risks.
These include metrics such as the number of customer complaints, the number of errors in processing transactions, and the number of system failures. They help identify operational risks such as process, system, and human errors; a few examples include:
- Customer satisfaction
- Inventory levels
- Production downtime
- Employee productivity
The main KRIs vary depending on the industry and the specific risks that an organization faces. Incorporating the monitoring of KRIs into your marketing strategy alongside KPIs can help you proactively identify and mitigate risks before they become significant issues.
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