Business risk comes in many different guises in 2019. Strategic, reputational, compliance, financial, political….the list goes on and on. The breadth, depth and variety of risk in modern business makes the task of efficient, effective and smart risk management even harder for many organisations.
But in the increasingly connected world in which we live and work, there is a new threat starting to make itself felt, that of connected risk. What exactly is this and how can organisations best defend themselves against it?
A hyper-connected world
The world in which we live and work is more connected than at any other point in human history. Technology has progressed to the extent that instant communication can take place across countries and continents, with deals agreed at the click of a button.Businesses are global now, still operating in their country of origin, but present in many territories all over the world. Production can be based in a country with low employment costs, while finances can be managed in areas of low tax.
But the ease of digital communication in connecting us all is also a flaw. Risk can be spread within moments, and the hyper connected world that we operate in is increasingly under threat from connected risk. With businesses continually exposed to partners, customers, suppliers and more, the risk is cumulative and can be spread rapidly. Because these organisations are so digitally connected, one single threat is expotentially shared across them.
This can mean that one relatively small local event, which in a pre-digital era would be confined to that area, can have global consequences, impacting organisations thousands of miles away and operating in a completely different sector. This could be anything from a supply chain issue to a political event, or as is increasingly likely, a cyber attack.
Managing connected risk
Connected risk can come in many guises, and given the spontaneous nature of events it can be hard to mitigate against. But cyber attack is the risk that is currently posing the greatest threat. With the internet of things so prevalent at home and in business, we have seen numerous instances so far in 2019 of cyber attacks being spread at high speed across the global, moving between interconnected organsiations almost at will.
A key element of managing and mitigating against connected risk is in equipping risk management teams with the right tools for the job. This means moving away from traditional approaches, such as Excel, and embracing digitisation for risk management.
By adopting an automated approach it ensures a continuous and on-going protection against a multitude of threats. It also means that risk modelling can be far more effective. OXIAL’s technology will accurately amplify the weak signals within an organisation and predict when risk might occur and what the likely impact of it will be. This allows the business in question to prevent and prepare for risk far more effectively than they might otherwise.
If one organisation suffers from connected risk, it is possible that all the organisations it is connected with will also do so. That’s why it is growing ever more important to ensure an organisations has the proper defences.
If you’d like to learn more about how OXIAL addresses connected risk using digitisation and risk modelling, please get in touch with us here.
