Enterprise still failing to prepare for risk despite events of the last 12 months
More than 70% of enterprises lack the technology to detect unexpected events that may negatively impact their business, according to a new study.
During a time where business resilience and innovation is core to organizational survival, a new study commissioned by real-time information discovery platform, Dataminr, found that only 29% of firms feel confident that they have technologies to accurately obtain an early view of unexpected events.
Titled Risk In A Real-Time World and conducted by Forrester Consulting, the study surveyed 410 global risk and compliance decision-makers across the U.S., U.K., Australia, and New Zealand to evaluate current risk management priorities and practices, and how real-time information is used in risk management and crisis response.
"At the onset of the COVID-19 pandemic, enterprises all over the world realised their blind spots within risk management and security that ultimately threatened the safety of their people, operations, brand reputation and bottom lines," says Ted Bailey, founder and CEO of Dataminr.
"In an era where organisations and leaders are now defined by how they respond to impactful, disruptive and divisive events, being caught unaware or unprepared can cause lasting damage to a company," he says.
The study analyses the new findings, and identifies inflexible tooling, lack of cross-functional collaboration, issues with confidence and company culture as stand-out challenges for global enterprises in their crisis preparedness response and planning.
Two key challenges identified were siloed processes and inflexible technology stacks. In fact, nearly 7 in 10 (68%) enterprise risk decision-makers find access to real-time information to be siloed.
Is Risk Management Being Treated as a Team Sport?
Over half (52%) of global risk and compliance decision-makers find cross-functional collaboration challenging, and 50 percent find process efficiency challenging when it comes to operationalising real-time information.
Findings also suggest that real-time information is not reaching everyone who needs it when it comes to important response activities, such as informing crisis communications (31%), impacting response plans as events unfold (30%) and assessing impact (30%).
Further, the research found that only 33% of organisations included the corporate communications department and 43% the human resources/employee experience group in their crisis response team.
The Advantage of Informational Accuracy, Visibility and Scalability
The research identifies the importance for businesses to have a holistic understanding of the meaning of real-time information; however, 75 percent of organisations were found to be using the term to describe data from today or older. Only 16% believed real-time information to be data from the past few seconds or minutes. The study shows key distinctions between those with an accurate understanding of real-time information and those with an inaccurate understanding below, specifically:
- Accuracy: Those with an accurate understanding expect a competitive advantage from a real-time alerting solution (48% vs. 34% who misunderstand real-time information)
- Visibility: Fifty-eight percent of those with accurate understandings expect enhanced visibility as opposed to 44% with an inaccurate understanding of real-time information.
- Scalability: Those with an accurate understanding of real-time information outpace their counterparts when it comes to expecting scalability (57% to 42%, respectively).
The New Road to Business Resilience
Over four-fifths (82%) of enterprise risk professionals believe having visibility and insights around real-time information is more necessary today than ever before. In turn, 44% of enterprises plan to either implement or expand the implementation of a real-time alerting platform solution that helps risk professionals do their job. Specifically, nearly 8 in 10 (77%) risk decision-makers plan to leverage more risk management solutions.
"As risks grow in speed and complexity, its evident that enterprises are recognising the need to proactively identify and mitigate risks as they unfold," says Jason Edelboim, president and COO of Dataminr.
"Business resilience in 2021 means having a holistic view of your unique risk profile," he says.
"A flexible risk framework, AI technology and real-time information all together offer an advantage for enterprise leaders who need to respond with speed and confidence."