Crisis readiness: What your company may need to prepare for

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A comprehensive survey of organisations worldwide revealed that cybercrime is considered the crisis that represents the biggest future threat (38%) – even bigger than the threat of financial strife and liquidity issues (28%).

This is one of the key findings of the just-released Global Crisis Survey 2019. The report collated extensive corporate crisis data from 2084 respondents, 43 countries and 25 industries.

The survey defined a crisis as something that is “triggered by significant internal and/or external factors, has an enterprise-wide effect, creates disruption in normal business operations and has the potential for reputational harm/damage”.

Here are the five key takeaways from the report.

No.1: It’s not if. It’s when: No one is immuneA total of 69% of companies surveyed have experienced a crisis in the past five years. The overwhelming majority of respondents (95%) expect to suffer from a crisis in the future.

“Crises don’t discriminate. They come in all shapes, forms and sizes – and no one is immune. What’s more, the very definition of a crisis will vary by industry. For example, consider a wind storm: For a financial services company, it’s a meaningless event; for a utility, it could trigger a catastrophe,” the report states.

No.2: The diversity of crises keeps organisations guessingMore than half of those surveyed said that at least one of the crises they suffered was operational in nature. This included operational breakdowns, competitive disruption, supply chain issues and product failure.

Companies with 5000-plus employees most commonly reported crises related specifically to cybercrime (26%), natural disaster (22%), leadership (17%) and ethical misconduct (16%) such as fraud or corruption.

No.3: The most disruptive crises aren’t necessarily the most newsworthy

Unsurprisingly, organisations cited liquidity issues, technological failure, and operational disruption as their biggest issues to date. However, future concerns are much more likely “to be in the news”. Cybercrime (38%), marketplace disruption (37%) and ethical misconduct (20%) are considered to be biggest sources of future crises.

No.4: Who’s responsible for crisis management? Everyone and no one

In terms of identifying who “owns” a crisis in the organisation, it’s complicated. Everyone from board members and CEOs to HR, to the legal department, to IT, claims responsibility for a variety of crisis roles – including preparedness, response, recovery, enterprise risk management and communications.No.5: Companies that emerged stronger from a crisis did specific thingsOut of 1400 organisations who have already faced a major crisis, 42% stated that they were “in a better place” in the aftermath. While 36% believed they were in a similar position and 19% said they were in a worse place.

The survey was conducted by PwC; 64% of the respondents were at the C-suite level and 36% were heads of departments.

Image: PwC