Cyber attacks are the top crisis facing organisations

Cyber attacks are the top type of crisis facing organisations worldwide, according to a new survey from Deloitte.

The survey of crisis management, business continuity and risk senior executives across 20 countries found that 60% of crisis management leaders also believe they face more crises than 10 years ago.

While organisations are generally confident in their ability to tackle crises including system failures (90%), regulatory or policy changes (89%), corporate scandals (88%) and cyber attacks (87%), the survey indicates that many organisations may be less prepared than they expect.

While 80% of organisations worldwide have had to mobilise their crisis management teams at least once in the past two years, only 17% of the senior crisis and risk executives surveyed test the team’s capability.

The research also found that almost 90% of organisations that conducted reviews after they had experienced a crisis had determined that the crisis could have been averted.

“From experience we know that it’s the ability to test, rehearse and simulate crises that ensure organisations are ready to respond with skilled leadership and plans that work,” Deloitte Australia Crisis Management Leader Tony Morris said.

“Being prepared, knowing how best to deal with incidents- or issues-led crises, and how to respond to them swiftly and appropriately, are all critical skills to successfully protect your customers and people, your operations and, of course, your reputation and brand.”

The stakes are high, with research indicating that there is an 80% chance of a company losing at least 20% of its value (over and above the market) in any single month over a five-year period, due to the impact of a crisis on reputation.

In addition, 70% of board members said it took their organisations up to three years to recover reputation following a crisis.

In Australia, almost 60% of big businesses surveyed said it took them between one and three years to recover both their business reputations and their operations following a crisis, with 10% stating that it took more than four years. Half of board members said it also took 1–3 years to recover financially.

Morris said technology can help ensure more effective crisis planning. “We know that platform-delivered APIs are very useful in both responding to crisis and conducting simulation exercises. They do this by collecting data on the organisation and pointing to which teams are available, where and when,” he said.

“Given the need to improve detection and early warning systems and, we now know, invest more effort in prevention, it pays to be able to do more to identify potential crisis scenarios.”

Image credit: ©lollo/Dollar Photo Club

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