Warning for businesses over unpreparedness

Warning for businesses over unpreparedness | Insurance Business Australia

Warning for businesses over unpreparedness

Australian businesses took a major hit from the COVID-19 pandemic, and many are still struggling through their recovery today, highlighting a general need to improve risk preparedness.

In its latest report, artificial intelligence (AI) business Dataminr delved into business risks and how Australian businesses can avoid slipping back into pre-pandemic unpreparedness levels.

Conducted in January 2022, Dataminr commissioned a study that surveyed 329 Australian business decision-makers from various industries, including healthcare, education, government, manufacturing, information technology (IT), telecommunications, financial services, and retail. Specifically, the survey participants answered how their businesses had performed during the last 18 months and what challenges they expect to face in 2022.

Before the COVID-19 pandemic started, two in three Australian businesses had a continuity plan, but only half had planned on a pandemic scenario. Since the pandemic started in 2020, 80% of Australian organisations have recognised the significance of adding a full continuity plan, with 64% confident that they have everything in place for 2022.

However, 19% of organisations that recognised a full continuity plan's significance felt that the risk landscape has not changed in the past five years, so they failed to adapt to the changes brought by the pandemic.

On the bright side, Dataminr's report found that nearly all Australian businesses surveyed invested in resilience, with 25% having invested over $100,000 between 2019 and 2021. Meanwhile, 72% increased their employee responsibilities, and 71% created a risk management team.

Read more: “The risk function cannot simply sit on its own anymore”

Dataminr offered five tips to help Australian businesses build risk confidence in 2022:

  1. Practice makes perfect: Scenario planning should be much more than a box-ticking exercise; it must become an intrinsic part of businesses' routine activity;
  2. Don't focus on known risk only because unknown risk is the biggest risk;
  3. Embrace risk as an opportunity: It is beneficial to regard preparedness as a positive driver for risk prevention and innovation;
  4. Empower people, foster collaboration, and support processes with the right technology and real-time information; and
  5. Businesses must always prioritise risk management to ensure they can proactively prevent future crises.

“If corporate security leaders weren't aware before, the COVID-19 pandemic certainly highlights that the biggest risk to businesses today is unknown and unexpected risks,” said Helen Sutton, senior vice president, EMEA and APAC, at Dataminr. “This is why, more than ever, Australian organisations should continue to invest in people, processes, and technologies that allow them to remain proactive and prepared to handle any risk or crisis.”