A new whitepaper entitled Transitioning from Risk to Resilience, has been published by Resilience First, with contributions from a number of experts within the field including McKinsey & Company and report sponsors Fusion Risk Management.
In a world where the threats are endless but the resources to prevent them are not, the most resilient organizations will thrive during uncertain times and gain a competitive advantage, as we have seen during the Covid-19 pandemic. The response must be a shift to a more dynamic, virtuous cycle of enterprise resilience management rather than the usual enterprise risk management.
Lord Toby Harris, Chairman, National Preparedness Commission, and Member of Advisory Board of Resilience First, said:
“When one uses quantitative measures like probability based on past trends to represent a volatile and unpredictable world then it is perhaps unsurprising that calculations go awry. Covid-19 has shown that there are systemic risks that do not readily lend themselves to quantitative risk analysis.”
“This whitepaper tries to look afresh at what is needed in a revised risk management framework. It starts with the premise that consequences or impacts are more important than causes or probabilities. If one accepts this assertion, it is possible to recommend a framework that has more qualitative components which focus on the softer skills.”
Robert Hall, Executive Director, Resilience First, said:
“Risk and resilience are opposite sides of the same coin. Risk is an interpretation of a vulnerability to, and the likelihood of, a specific danger that focuses on preservation and restoration – to avoid, retain, transfer, or mitigate the risk that may follow. Resilience, on the other hand, is more a behavioural and structural response to, or consequence of, a changed set of circumstances that assumes recovery of the status quo ante will not be possible – adaptation to the change follows.”
“The traditional approach to risk management has been shown wanting in the face of the challenges: we have been caught short in preparing for those challenges. The linear approach no longer meets the demands of systemic or significant dangers which can be both volatile and ambiguous. This whitepaper proposes a shift to a more dynamic, virtuous cycle of enterprise resilience management rather than the usual enterprise risk management.”
Bob Sibik, Co-Founder and Senior Vice President, Fusion Risk Management, said:
“The pandemic has exposed many of the problems with current risk management practices. It has also accelerated the need to transform our risk management practices that enable decisions on enterprise resilience, outage tolerances, risk appetites and the appropriate levels of investment in prevention and preparedness.”
“There will be competitive advantage for those organizations that are resilient. In a world where the threats are endless but the resources to prevent them are not, the most resilient organizations will thrive during uncertain times, as we have seen during the Covid-19 pandemic.”