Poole ERM Initiative’s Report Lists Top 10 Business Risks in 2020
The newest risk report from the NC State Poole College of Management Enterprise Risk Management (ERM) Initiative identifies the highest concerns that global boards of directors and C-suite executives have for next year. The report, Executive Perspectives on Top Risks for 2020, was a collaborative effort between ERM and Protiviti, a global consulting firm, that surveyed over 1,000 board members and executives in various industries. The survey asked respondents to rate 30 different risks in relation to macroeconomic, strategic and operational issues.
While the respondents think that the global business outlook for 2020 is less risky than 2019, a majority of the respondents rate the top 10 risks for 2020 as “Significant Impact” risks. The areas that most concern global executives and boards are increased competition for specialized talent, organizational ability to drive and use digital and technological advancements, and attracting and retaining top talent.
Here are the top 10 risks identified in the Executive Perspectives on Top Risks for 2020 report:
- Regulatory changes and scrutiny may increase and that will noticeably affect the manner in which products or services will be produced or delivered.
- Economic conditions in markets that the organization serves may significantly restrict growth opportunities for organizations.
- Challenges in organizational succession and attracting and retaining top talent may limit the ability to achieve operational targets.
- Existing operations, legacy IT infrastructure and the insufficient embrace of digital thinking and capabilities may not meet the organization’s performance expectations related to quality, time to market, cost and innovation and competitors, especially born-digital competitors, with low-cost bases for operations, or established competitors with superior operations.
- Resistance to change may restrict the organization from making necessary adjustments to the business model and core operations.
- The organization may not be sufficiently prepared to manage cyber threats that could significantly disrupt core operations and/or damage the brand.
- Ensuring privacy and information-system protection may require significant resources.
- The organization’s culture may not sufficiently encourage the timely identification and escalation of risk issues that could significantly affect the organization’s core operations and achievement of strategic objectives.
- Sustaining customer loyalty and retention may be increasingly difficult due to evolving customer preferences and/or demographic shifts in the organization’s existing customer base.
- The organization’s adoption of digital technologies (e.g., artificial intelligence, robotics, natural-language processing) may require new skills that either are in short supply or require significant efforts to train or retrain existing employees.
The list of top 10 risks from ERM’s Executive Perspectives on Top Risks for 2020 report was originally published on the ERM website.