The world is a complex and unpredictable place, and for businesses operating in an increasingly interconnected global landscape, geopolitical risk is no longer a distant rumble, but a constant storm brewing on the horizon. From trade wars and cyberattacks to pandemics and regional conflicts, the potential for disruption is ever-present.
Yet, amidst the uncertainty, there is an opportunity to seize control. By embracing a forward-looking, proactive approach to geopolitical risk management, businesses can not only weather the storms, but emerge stronger and more resilient.
The analogy of geopolitical risk as a “flyover state” – acknowledged but deemed irrelevant – is a dangerous fallacy. As the Manila and Taiwan earthquakes starkly illustrate, seemingly distant events can have devastating consequences, disrupting supply chains, severing communication, and revealing vulnerabilities. The COVID-19 pandemic also underscored this interconnectedness, exposing businesses that had failed to consider or prepare for such a global crisis.
Supply Wisdom CEO Tom Thimot
This isn’t about predicting the future; it’s about acknowledging the inherent uncertainty and taking action to mitigate its impact. Just like Reginald Victor Jones, the pioneer of scientific intelligence, didn’t predict the Battle of Britain. He prepared for it by meticulously gathering and analyzing information.
In the same vein, businesses must move beyond reactive, crisis-driven responses and adopt a proactive, “see what happens, show up” approach.
Building a robust risk management framework involves several key steps:
The benefits of proactive risk management extend far beyond mere crisis preparedness. It can:
In an ever-changing world, certainty is a luxury we can no longer afford. But by embracing the power of “knowing what’s knowable” – gathering intelligence, assessing risks, and taking proactive steps – businesses can navigate the unknown with confidence.
It’s not about predicting the future, but about being prepared for whatever it may hold. So ditch the “flyover state” mentality, roll up your sleeves, and start building a resilient future for your business. Remember: The storms may be inevitable, but you don’t have to be caught in the rain.
Tom Thimot is chief executive officer of Supply Wisdom. Its platform provides continuous monitoring, intelligence reports and real-time alerts across the financial, cyber, operational, ESG, compliance, Nth party, and location-based risk domains.