Customer priorities and touch points are changing rapidly, and the massive shift to remote working poses a major challenge for leadership.

The Pandemic taught us the massive global market disruption that took place without any alarming sign. The government priorities, business model modifications, & consumer need pattern changed overnight. 

Global businesses have faced unusually difficult conditions over the past two years. Our financial data analytics tools and consultant have found that a number of recent events, such as the economic downturn, high inflation, decline in travel, changes in consumer behaviour, and disruptions to global supply chains, have left 52% of businesses unable to pay their bills in the coming year.

Despite the rarity of these occurrences, it is crucial that your company be resilient enough to withstand potential macro and microeconomic difficulties. Your chances of surviving are higher the healthier your cash flow is right now.

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Today, it is impossible to fit the probability and impact of events into a neat probability distribution. As an illustration, think about how useless most polling was in predicting the recent US elections or the British vote to leave the European Union.

Treating resilience as a quality that will eliminate earnings and share price volatility in such a situation is both unrealistic and counterproductive. We instead make a distinction between true risk—exposure to a long-lasting adverse change in trajectory—and volatility, which are predictable fluctuations in every business over time.

In fact, attempting to reduce volatility is similar to purchasing insurance that guards against the deductible rather than the actual loss. The larger goal, which is to make sure that the inevitable setbacks encountered along the way don’t permanently harm a firm’s capacity to produce an acceptable return on the capital invested across the cycle, is missed.

Instead of relying on the past, true resilience requires considering what could happen that would really test the company. Cyberattacks and significant technology outages—sometimes caused by the failure of just one router or server—have affected many businesses that have demonstrated resilience in responding to strategic and financial shocks. Technology will present greater risks that some businesses haven’t yet adequately prepared for as trends to digitalize and automate operations pick up speed.

It is a fool’s errand to attempt to categorise and quantify the universe of all potential shocks. Instead, strategic executives will develop the organisational capabilities needed to assess which shocks are most important (in terms of both impact and likelihood) in light of industry- and firm-specific economics. Although there are many potential shocks, there are far fewer transmission channels where these could actually harm a specific business. Our analytical team and tools give you the precise options and backup plans you need to ensure resilience.

Companies that are resilient can anticipate risk, reduce losses, and quickly resume operations after an event, giving them an advantage over less prepared competitors. This process is ongoing and integrated with a continuity management system and strategy. There is a sizable perception gap, with risk management functions of organisations giving short-term threats priority over threats with a high impact but low frequency. They could be exposed to short-term and long-term disruptions of their operations, assets, and revenue streams as a result.

Given the major six risk areas—pandemic, cyberattack, emerging technologies, environmental, social, and governance risks, regulatory changes, and geopolitical risks—continuity of being resilient is crucial for the development of global business.

For the journey toward becoming more resilient, we identified four common behaviours: anticipating significant risk issues, linking risk management to business strategy, avoiding gaps in the perception of preparedness; and measuring pertinent data.