It’s that time of year again and the predictions are in for what’s ahead in 2018 – see below for the links. Personally, I enjoy reading the various reports but making them relevant to a specific organization, product, process, function, person, etc. is quite a challenge. Where’s the case for action? On the surface, the half dozen or so risk reports reflect the reality of an organization’s challenges. However, for most organizations, it’s difficult to determine the relevance of the event/threat/risk, the magnitude of the potential disruption and the circumstances that need to be in place for the risk to become fully realized. It’s not that they are unable to make the connection. It’s about competing priorities and the investment needed in time, management attention, resources, and capital or budget needed to understand uncertainty. The list of questions is a long one; how do these risks influence or accelerate change in the industry’s value chain (and your product/service value proposition)? How does the event or change impact profitability?
You might ask, isn’t the organization and it’s leaders already “all-in” on this topic? Haven’t they made massive investment in people, process and technology to support massive ERM programs (enterprise risk management), risk registers, audits and third-party assessments, compliance reviews, and dozens of [fill in the blank] risk program (e.g. quality, business continuity, security, cybersecurity, environmental, health, safety, corporate responsibility, sustainability, insurance, records management, supply chain, and now…strategy risk).
Hold on for a minute! Maybe the way risk is being viewed and managed and the methods for allocating resources is the greater exposure? In today’s dynamic, information-rich and technology-driven world why can’t we immediately link a change, threat or event to the profitability, performance, and value of a particular product, product family or revenue stream? Why does it take so long for the organization to understand (and respond) to potential economic, social, and jurisdictional consequences and opportunities? We are a society that has commercialized complex technologies such as autonomous vehicles, robotics, and 3D printing so what’s the big deal? Hmmm, maybe the lack of the business case for understanding uncertainty, risk and opportunity or exposure is the issue. For many of us who have been dabbling in this topic for awhile, we acknowledge that there’s plenty of room to improve the mindset/behaviors and attitudes towards risk as well a need to greatly enhance competencies and capabilities in the context of business and social goals.
The good news, change is coming and it’s coming fast. Stay tuned as we explore many of these changes through a practical and actionable lens. I’d love to get your thoughts, come join the journey! In the meantime, enjoy the read and of course, consider who’s presenting results!! If you’ve seen one risk report, you’ve seen one risk report – it’s about who’s point of view.
“World Economic Forum Global Risks 2018”, WEF Global Risk Network
“Top Risks 2018”, Eurasia Group
“The Top Global Risks for 2018”, Protiviti
“Allianz Risk Barometer 2018”, Allianz
“Top Risks 2018”, Atlantic Council
“Three Emerging Market Risks Companies Should Watch Out for in 2018”, HBRHarvard Business Review
“2018’s Most Dangerous Risks for Insurers”, Willis Towers Watson