Running regular crisis simulations gives our team first-hand experience of the risks leaders believe they need to prepare their teams and organisations for.
These are often very specific sorts of crises – from personnel issues to data breaches to product recalls.
But it’s interesting to think about how broader scale risks could impact individual organisations.
The World Economic Forum recently released its Global Risk Report for 2024.
The report asks around 1500 global experts for their opinions on any short and long-term risks that the world may face.
The report looked at risks for 2024, those we can expect over the next two years, and risks we may encounter in a decade.
Issues to prepare for over the next year
The top five issues the respondents were concerned about were: extreme weather events (66%); AI-generated misinformation and disinformation (53%); societal and political polarisation (46%); the cost-of-living crisis (42%); and cyber-attacks (39%).
Why would organisations need to prepare for these threats?
The impact of extreme weather
The UK has recently seen how damaging and disruptive extreme weather events can be, with many people seeing their houses flooded and others having to deal with extreme cold.
As climate change progresses, we’ll likely see more extreme weather events. These events have the potential to cause power cuts, damage property, disrupt service and harm people. And these are all things that organisations will need to prepare to respond to.
Tackling misinformation and the impact of polarisation
As AI becomes more sophisticated, it will be harder to spot fake images and videos. Respondents to the report see this sort of misinformation and disinformation as having a big impact on elections and the economy over the next few years. We know already that people don’t trust information they receive from the government and mainstream media.
As this distrust grows, over the next few years we could see social polarisation increase and governments trying to crack down on misinformation by restricting various freedoms on the internet (and freedom of the press).
For organisations, this manifests as trust. Can people trust your word? Are they sure about the information coming from your official channels? And how will your organisation deal with the threat of fake information? How will it deal with a polarised audience without alienating people you want to keep engaged?
Understanding how the cost-of-living crisis affects your organisation
The cost-of-living crisis is testing brand loyalty as people switch to cheaper brands to save money.
Brands are also being called out for shrinkflation – reducing the size of products, but charging the same amount (or more). Then there’s skimpflation – where some brands are lowering the quality of products and services to save money, like using less chicken in a chicken pie, for example.
Consumers notice when the quality of a product declines, the taste of their favourite food changes, or they’re suddenly getting more air than food in their bag of crisps, and they don’t like it.
How brands respond to the huge pressures on their profit margins and overheads will continue to be a difficult balancing act. They may save some money in one place, only to lose money as consumers switch to a brand that gives them more bang for their buck.
Cyber-attacks are still a massive threat
Cyber-attacks will, of course, be a big problem this year. Right now:
- The British Library is still recovering from a ransomware attack that leaked some employee data
- JP Morgan Chase said hackers are trying to get into its systems 45 billion times a day (which has doubled from early 2023)
- 23andMe is facing lawsuits from at least 30 people affected by its huge data breach (and the brand is claiming the victims were at fault for using passwords they’d used elsewhere)
- Capita is being sued by thousands of pension holders for a hack (which has been linked to Russia)
These are just some of the examples of what organisations are dealing with right now, and the threat is increasing. Organisations will be judged on how well they respond to these attacks, but prevention and preparation are key factors in minimising or avoiding damage.
Future threats
The WEF report outlines major risks in the next decade, mainly coming from the fallout of climate change, but the impact of AI, misinformation and cyber-security issues will still be significant threats, with AI creating new security risks that nations and organisations will need to prepare for and respond to.
It may be wise to look at risks like the impact of future pandemics, technological changes, climate change, conflict and problems caused by social disorder, when considering long-term crisis planning and preparedness.
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