Of known and unknown unknowns
Jinfo Blog

By Tim Buckley Owen

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Many firms are insufficiently prepared to deal with risks, even the ones they know about; and in the critical regulatory risk environment, communication is the top priority. The findings come from two new surveys of senior management – but the issues they address are spot on for corporate information managers.

In The Risk Radar: How Firms are Navigating Risk, the Economist Intelligence Unit finds that, although currency fluctuation and new regulation are the risks that most executives fear, only a modest proportion of the respondents have strategies in place to counter them. Regulation also features as a key concern for respondents to Forbes Insights’ Strategic Initiatives Study (registration required), with almost 60% regarding it as a key risk, and a third intending to employ better communication to support their regulatory and legislative outreach.

There’s cautious optimism among the Forbes respondents that well considered plans can still yield productive initiatives. But they recognise the need to take careful steps about being better informed, and are particularly concerned that initiatives often fail because of lack of buy-in from ill-informed stakeholders.

There’s an interesting sideline on this last issue in the iconoclastic Register newsletter, where Nathan Coates paints a quirky picture of “business process retweaking”, resulting from better internal communication. Staff’s initial resistance to using new applications often disappears when people realise how much their work can benefit from sharing information with colleagues, he says – and as silos start to erode, inefficient working methods become more obvious.

Meanwhile respondents to the EIU survey are also concerned about people being informed – specifically the wrong people. Security breaches and cyber attacks are a key worry; EIU suggests that the controversy surrounding WikiLeaks may be making businesses more information security conscious, and it also cites the example of the high profile attack on Google in China in 2010.

China is indeed a source of wider concern in the information industry. Although it’s currently a trading partner that few in the world can do without, it’s also highlighted as a potential risk in an updated version of LinkedIn’s initial public offering prospectus.

Sharp-eyed journalists at Bloomberg have spotted that LinkedIn now says the possibility that China may bar access to its site constitutes a new risk to investors. The earlier offering document contained no such reference, Bloomberg reports, and the new warning followed an actual LinkedIn blocking by the Chinese authorities for more than 24 hours in February.

Realistically, information professionals are neither equipped nor qualified to anticipate new corporate risks in every circumstance. But there are some commonsense phenomena that we ought to be able to spot: patterns, parallel developments, the counter-cyclical or counter-intuitive, straws in the wind and backlash.

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