Risk sensing in 2018 and 2019: Looking back and moving forward
Harness the world’s available data to anticipate emerging events
From a risk perspective, 2018 was an interesting year. But what will 2019 bring? In this blog series we look back, but moreover: we move forward. How can developments around blockchain technology, cyber security, risk sensing and privacy help you gain a competitive advantage in the years to come? Episode 2 is about risk sensing and anticipating emerging events.
By Sem de Spa
This year, the competitive landscapes in which leading companies operate have increased in complexity. Advanced technologies and innovative start-ups have entered the market, while the geopolitical situation seems to be more volatile than ever. Leading organisations need to navigate through this seemingly unpredictable landscape, with the risk of being outpaced by new competitors or impacted by new regulations.
The exponential growth of data sources worldwide provides an opportunity to anticipate such emerging events. Experts leverage social media listening tools and data analyses to detect early indications. Unfortunately, however, there are some difficult challenges in this area:
- Information overload
The information overload tends to overwhelm even the experts. The need to search on dozens or more keywords in millions of articles makes it nearly impossible to distinguish real signals from irrelevant noise.
- Blind spots
Despite the information overload, there are also blind spots. Most of the information is about the Western world, whereas many risks occur in other regions. Consider, for example, data on production facilities in Russia or emerging markets in Africa.
- Information bubble
Much of the information on non-Western regions, including China and the Arab world, that is available in Western languages is biased due to the Western perspective. However, when analysing markets it is important to get the perspective of local professionals and citizens.
Due to these challenges, organisations tend to miss early indicators of events that can negatively impact their business.
Combining the world's available data with human and artificial intelligence
Good news for 2019
The good news is that emergent data-analysis technologies have made it possible to filter out noise and find specific signals in large information streams. With our team of leading data scientists, linguists and business and industry experts we can now process articles on over 800,000 websites in 10 major languages into intelligence that can be tailored to every kind of organisation’s needs. Because we capture over 95% of relevant web content in real time, we provide the most reliable and balanced information that is available for strategic decision-making.
Until recently, only the most advanced national intelligence agencies had such a capability; now it is available to every organisation. For example, we helped an international manufacturing company with its enterprise risk management, which had become extremely challenging due to new market developments. We provided the company with a risk-intelligence dashboard that identified eight new (start-up) competitors that were not yet on their radar. Most of those start-ups were manufacturing highly innovative products with a high probability of impacting the market in the coming 12 months.
Extended enterprise: third-party monitoring
At the request of a large pharmaceutical company with over 120,000 counterparties, we implemented an alert system to manage their third-party risk. Whenever, for any of those counterparties, a high-risk event occurs that might damage our client’s reputation, our solution generates a flash report with information on the nature of the risk and its potential impact. Apart from automating a costly manual procedure, the quality of the risk intelligence has proven to be significantly higher than was the case.
Having successfully rolled out these initial implementations in 2018, we would now like to bring this capability to all our key clients in 2019. Can’t wait to see how risk sensing can impact your organisation? Please contact Sem de Spa via contact details below.
Read also 'No challenge too big: Sem de Spa over Risk Sensing' (in Dutch).
A closer connection to the real world
Extended enterprise risk management global survey 2018