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When it comes to software development, most businesses focus on project management methodologies, offshore service models, tools, expertise, and trending technologies (such as AI) to improve application performance and team productivity.

Risk management, on the other hand, is often overlooked by many businesses – especially smaller ones that need to grapple with tight constraints revolving around their software development processes.

However, risk management can deliver businesses with the foundational integrity and protection they deserve, for future growth. Therefore, this article is dedicated to four key areas where risk management strategies are required, as it relates to software development.

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Risk management for compliance

With businesses now functioning digitally, government and private regulatory authorities have made compliance obligations necessary, yet also more demanding at the same time. Businesses are mandated to adhere to what applies to them, else face penalties, closures, and even reputational damage.

Data governance is one of the biggest areas that attract the attention of regulatory bodies. Web and mobile apps are common customer touch points, collecting confidential data. Many standards are now in place to govern the collection and use of all this information, and no matter where a business is based, some form of data regulation may apply to them. This calls for custom software development that is compliance-oriented.

In other words, every step that a user takes within an application needs to adhere to regulatory standards. In collaboration with legal and regulatory subject matter experts, software development teams need to build a user journey from as early as the information gathering stage, to reveal which steps, fields, and actions are subject to policy rules – and implement relevant principles for safe data handling.

But compliance doesn’t end upon initial implementation, though. Just like DevOps, software compliance management is an ongoing effort, requiring teams to constantly be in lockstep with changing regulations, so they can be addressed at the earliest possible in order to keep systems compliant at all times.

Risk management for security

Cyber security risk assessments are a major category within the larger umbrella of cyber security, which calls for security operations teams to execute for even the smallest business use cases. Typically, cyber security risk assessments involve:

1. Identifying all access points, assets, infrastructure, and users that exist within the confines of, and in connection to an organisation’s network,
2. Evaluating all possible vulnerabilities that the above components and users could be subject to, as well as the likelihood and severity of each,
3. Delivering possible solutions to fix any gaps. This also includes awareness training for personnel.

Any custom software or application under development will also be identified during the first step. Cyber security risk management strategies can be applied to software project lifecycles from as early as the design stage, while a DevSecOps approach ensures all patches and upgrades are constantly carried out with security in mind.

Data security is another crucial component of application security. For example, Data Loss Prevention (DLP) tools help encrypt data in use, transit, and at rest, while exfiltration prevention technologies can be adopted to prevent data from leaving the organisation without prior authorisation. Geo-redundancies, which facilitate multiple backups across numerous physical data centres (ideally around the world) are also another key component of data security.

Risk management for scalability

As companies grow, so do their needs in terms of cloud infrastructure and AI tooling. Shifting customer preferences and changes within the economy also prompt many business leaders to pivot accordingly. In turn, businesses end up purchasing infrastructure and assets in short notice, to accommodate changes. While this can address issues and needs at hand, it can lead to technical debt, causing systems to function and be priced suboptimally – especially if neglected for long periods of time.

Such short-notice and sudden decision making can also lead to security and compliance compromises. As a result, it is imperative for teams to make sure integrity is maintained in the following areas:

• Classifying and storing data consistently across databases,
• Adopting the most reasonable pricing models, through cloud optimisation strategies,
• Formalising the usage of data for AI model training, through carefully built fair use and AI ethics agreements,
• A zero-trust security policy, which gives security teams the authority to inspect every new asset and user prior to providing least-privilege access,
• Periodic code reviews, to ensure code hygiene and integrity is maintained when writing and debugging code.

Today, AI and machine learning technologies empower teams to operate at scale. This includes adopting custom AI models for anomaly detection, pattern analyses, and even intelligent recommendations for next steps. Most popular programming languages can also be reviewed via automated tools that are powered by AI, giving development teams the support they need to deliver working code faster – while maintaining integrity and consistency.

Risk management for customer experience

Customers hold power over how businesses position their products and services. Many fast-paced industries that experience high fluctuations in consumer preferences, such as FMCG, retail, and hospitality have businesses scrambling to meet demands at preferred budgets. What follows is an increase in volumes – both in terms of customer inquiries, and production.

This is a crucial phase for most businesses. While an increase in volume is yearned for by many a business leader, scaling sufficiently to meet these increasing volumes is far more challenging. Before businesses ever reach this juncture, it is important to have a plan in place on what to do, whenever a peak in volume arises.

With most customer-facing touchpoints now being digital, your software development team will be front and centre here. Together with marketing teams, it is necessary to build a cadence around:

• Customer journey mapping, so every step a user is made to take is done so with intent, and brings them closer to conversion,
• Sentiment analysis, to understand how customers truly feel about your brand,
• Complaint handling and reputation management, to take care of any complexities that erupt along the way.

When developing software, teams seldom think about the CX quotient. While UI/UX flows during the design phase take customer needs and pain points into consideration, CX components may get sidetracked later. The best businesses combine software development services with perpetual customer analytics to unravel key customer insights, and then apply them to upgrade applications accordingly.

In conclusion...

Long-term and ongoing software development projects are now subject to comprehensive risk management across several areas, such as:

• Compliance and regulations,
• Cyber security and monitoring,
• Future scalability and foundational integrity,
• Customer experience.

With modern businesses now highly reliant on digital infrastructure, assets, and services to function, teams are required to meet compliance obligations and contain cyber threats as they emerge. But risk-related responsibilities don’t end here – teams also need to maintain a foundation where data, tools, codebases, and other components are consistently maintained through correct procedures, in order to prevent hidden costs, technology sprawl, and other vulnerabilities.

With responsibilities that go beyond core design, development, testing, and implementation, all of this requires commitment from your software development team. In collaboration with allied teams in legal, cyber security, and even marketing, software development becomes the lynchpin for all things risk management, for a business’s digital presence.