As the global economic situation worsens, you may experience a spike in demand for the security team’s services and a drop in the resources available to you. It’s tempting to scale back your activities and focus on your core competencies. But that’s not the best way to protect your budget and your people, says head of advisory, Cvete Koneska.
2022 was a challenging year for businesses. And 2023 will see more of the same.
Looking back at the past year, geopolitical risk soared in response to Russia’s invasion of Ukraine. The ensuing sanctions and retaliatory measures between the West and Russia triggered a downward economic spiral. Rising food and fuel prices led to growing inflation and an energy crisis, pushing many major economies into crisis. Its effects will last well into this new year.
For risk and security teams in companies, the combined geopolitical and economic risks pose a particular challenge. While geopolitical risks create a growing demand for your services and advice, the deteriorating economic situation means there will likely be fewer resources to do so effectively.
Frozen budgets, smaller teams – yet higher demand
Data from our survey of corporate security managers from August 2022 suggests a growing gap between the demand for geopolitical advice and the budgets allocated to it in many organisations. While 91% of respondents reported increased demand for geopolitical analysis within their organisation, only 30% expected any increase in their budget for 2023.
Unfortunately, that gap between demand and resources is likely to continue to grow as the economy continues to slow down in many regions. Perhaps your budgets have been frozen or even cut. Your team may have been reduced, increasing the workload for your remaining team members and creating huge stress.
The temptation may be to cut down on your department’s activities and focus on your core tasks and competencies.
But this would be a mistake. In times of crisis, it is even more critical to demonstrate the value that risk and security teams bring to the business, in order to justify and protect your budget and set a solid foundation for your team’s continued growth and recognition. How you engage with senior decision-makers during a crisis will also determine whether you maintain their trust in future.
Don’t do more. Show more value
Demonstrating the value that you bring to your organisation is not about doing “more”. It’s about showing that the risk and security functions are essential to mitigating the impact of the economic crisis. They protect revenue, enhance operations and help the business achieve its aims despite the tough economic environment.
Enabling business is always important, but it becomes imperative when your function is under pressure.
One opportunity is to help your c-suite properly evaluate opportunities for growth. These are more difficult to find and tend to carry more risk during economic downturns, so whether senior leadership is considering new markets or opportunities or even market exit, they’ll look at risk carefully. You can help them look beyond financial risk at the broader risk landscape – for example, at the geopolitical environment – offering valuable strategic input which directly impacts the company’s future and bottom line.
You can apply risk models and risk mitigation tools to internal company projects, as well. To deal with economic pressures, many organisations will be implementing restructuring and other cost-saving internal initiatives. Their success will depend on a thorough understanding of a wide range of internal and external risks. Your expertise in this area will be essential to ensure these initiatives succeed, and your organisation emerges stronger from the economic downturn.
Deliver unique insights for your board
Providing this added value with a tight budget and limited resources while managing your existing workload can be a major challenge.
You may need to bring in expertise and skill sets that complement those of your team and help you quickly and confidently deliver the strategic analysis your company needs. By its nature, such work requires a bespoke approach, so the deliverables address your objectives, speak to your priorities and genuinely enable business growth. For the same reason, you’ll get better results working with advisors who go to some lengths to understand your organisation and your unique risk profile.
That’s where Dragonfly’s advisory services can help.
We already work alongside many of our clients’ security and risk teams to complement and amplify their internal intelligence and analytical capabilities with bespoke advice, analysis and data. This can include a geopolitical risk analysis of new markets, forecasts of emerging global risks, introducing data-led risk models and more.
The intelligence reports we produce are always:
- Bespoke. They are tailored specifically to your organisation and your needs, feeding into the strategic questions being considered by your senior decision-makers so they are immediately useful, relevant and actionable at board-level.
- Highly analytical. They blend our intelligence and data with your insights, in order to produce unique, forward-looking assessments that help your C-suite make decisions.
- Engaging. They summarise risk and intelligence in a compelling way for different audiences, from the boardroom to the control room on the ground. And they present data through impactful infographics, so board members can quickly see trends, outliers and patterns.
This strategic approach allows your security team to become integral to conversations around your company’s growth in challenging times, providing immense value to your organisation and reducing the likelihood that you will be targeted for cuts in future.
How we helped one company successfully relocate its headquarters
For example, one of our clients – a major oil and gas company – was undergoing a significant internal restructuring in response to changing market conditions, and planned to relocate its corporate headquarters to the MENA region.
As this was a significant undertaking, they wished to gain additional insight into the security, political and economic conditions in the countries they were considering, as well as the drivers of risk locally and the likely future trajectory.
The security and risk team was eager to support the restructuring and stepped up to play a substantial role in this critical internal initiative, with help from Dragonfly’s advisory team.
We provided a bespoke assessment of the geopolitical risks to the business and different locations in the Gulf region over a five-year outlook. The intelligence assessment gave high-level judgements based on evidence and intelligence, trend projections, scenarios analysis and forecasts on future risks to the client. The assessment was prepared for board-level decision makers, intended to inform long-term, high-consequence decisions.
With our analysis and forecasts, the company was able to make a more confident, risk-informed decision about the location of its global headquarters. And the security team contributed significantly to the board’s discussions and the strategic direction of the company.
Book your Business Enablement Discovery Session today
Would you like to do more to help your organisation grow during these challenging times but are not sure where to start? If so, we would be delighted to offer you a Business Enablement Discovery Session with our head of advisory services, Cvete Koneska.
During this one-to-one session, which is complimentary to SIAS subscribers, we will discuss ways in which your security or risk team can add significant value to your company by supporting its strategic aims and enabling business – thereby making your function more resilient to economic pressures.
Together we will:
- Show you the most effective ways to use horizon-scanning to spot emerging risks as the economic and geopolitical landscape becomes more complex
- Review how you currently help business growth and manage risk to identify key gaps and suggest potential solutions
- Start identifying opportunities for you to support your company’s strategic aims with intelligence
- Discuss how you can become a business enabler even when resources are limited and budgets are under threat
- Explore how you can use strategic intelligence to engage with your board and senior leadership and input into conversations about the future of your business
At the end of the session, we will also explain how we can help you enable business through our advisory service. If this is of interest, we’ll discuss next steps. And if you prefer to follow the steps we’ve outlined yourself, we’ll still leave you with excellent advice on how to add significant value to your business.
Image: Man on a rocky peak looking over the water. Photo by Shunli Zhao via Getty Images.