According to a survey of 825 global business executives and board members, the greatest risk businesses face is their ability to adopt digital technologies and compete with companies with more digital-centric business models. Survey respondents were asked to rate 30 risk issues and the top 10 risks identified in the Executive Perspectives on Top Risks for 2019 report are as follow:
- Existing operations meeting performance expectations, competing against “born digital” firms
- Succession challenges and ability to attract and retain top talent
- Regulatory changes and regulatory scrutiny
- Cyber threats
- Resistance to change operations
- Rapid speed of disruptive innovations and new technologies
- Privacy/identity management and information security
- Inability to utilize analytics and big data
- Organization’s culture may not sufficiently encourage timely identification and escalation of risk issues
- Sustaining customer loyalty and retention
Digital threat to business models
The report, published by Protiviti in collaboration with North Carolina State University Poole College of Management’s Enterprise Risk Management (ERM) initiative, shows that company executives are increasingly concerned about the digital readiness of their organisations. Some firms are struggling to compete with newer digital players that operate more efficiently, are more able to innovate and have more flexible business models.
“Looking forward, digital disruption is a main driver of risk impacting uncertainty over business model viability, customer preferences, the competitive landscape, workplace dynamics, the war for talent and even regulatory demands,” said Protiviti's Patrick Scott.
The firm's Jim DeLoach, a member of the research team, added: “Organizations must be willing and able to quickly make necessary adjustments to their business models and core operations.”
The survey was conducted in the fall of 2018, and respondents represent organisations across the globe in the public and private sectors, 60 per cent of which have annual revenues of $1 billion or more.
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