Improving resilience amid geopolitical conflict

improving resilience amid geopolitical conflict

The recent conflict between Israel and Palestine is the latest in a series of major geopolitical escalations in recent years. For companies in affected regions, consequences can be immediate and dire. However, companies further afield may also be impacted. Organisational resilience comprises crisis response and longer-term business continuity. ERM International offers expertise in both areas.

The recent conflict between Israel and Palestine is the latest in a series of major geopolitical escalations in recent years. Such events highlight the very real need for organisations to implement robust organisational resilience systems.

But what exactly does this mean? And how should you implement it in your organisation?

Moreover, if your industry is exposed to significant external influencing factors, what are the steps you should take right now to best prepare the organisation?

ERM International has deep expertise and experience in organisational resilience. Contact us today to talk about how we can help your business.

What is organisational resilience?

Organisational resilience focuses on identifying critical processes in an organisation and developing controls in the event the critical process becomes unavailable for an unacceptable length of time.

However, controls within a robust resilience program will have different objectives. Organisations may wish to implement controls focused on immediate response to maintain an acceptable level of operation. And, they may seek to identify sustainable mechanisms for managing long-term disruptions.

Crisis response planning focuses on ensuring – insofar as possible – the immediate safety, survival and protection of an organisation’s people, sites and business assets. This process involves incident management, emergency management and communication management (with employees, external stakeholders and media), alongside a range of other tactical action plans.

Longer-term business continuity is more focused on second- and third-order impacts. For many organisations, it is not the conflict itself that needs to be managed as the trigger event, but rather the disruptions and threats that may occur as a result.

For example, a conflict may increase cyber security threats or supply chain disruptions, divert public policy or funding, cause fluctuations in oil prices and so on. Being able to see what is coming more clearly and respond quicker than your competitors is what will give your organisation a competitive advantage in times of disruption.

See more about building foundational resilience in your business.

How to monitor geopolitical tensions

So how do you develop a clearer picture of an evolving geopolitical situation?

ERM International has developed the following metrics checklist:

Geopolitical situation worsening

Geopolitical situation improving

Bilateral diplomatic escalations: Keep an eye on diplomatic relations between the nations in conflict and other countries. Downgrading of diplomatic ties or expulsion of ambassadors can indicate a worsening crisis.

Economic sanctions or trade disruptions: Monitor reports of economic sanctions, trade disruptions or boycotts by other countries. These actions can have a significant impact and are an indicator of worsening international relations.

Mass displacement and refugee movements: Monitor reports of mass displacement of civilians and refugee movements, both internally and across borders. This could indicate a severe crisis with the potential for a larger regional impact.

Involvement of regional powers: Keep an eye on statements and actions from regional powers, indicating their support for one side or involvement in mediation efforts. Significant involvement of these countries could escalate the crisis.

International military support: Monitor reports of foreign military support to either side, such as the supply of weapons or troops. The involvement of foreign military forces can escalate the crisis.

Proxy conflict escalation: Pay attention to signs of the initial crisis becoming part of a larger proxy conflict involving other nations and regional actors.

Decrease in violent incidents: A noticeable decline in the frequency and intensity of violent incidents, such as rocket attacks, airstrikes and ground clashes, can be a clear sign that the crisis is easing.

Humanitarian aid and reconstruction efforts: Increased humanitarian aid delivery to affected areas, as well as efforts to rebuild infrastructure and support displaced populations, are positive indicators of easing tensions.

Resumption of diplomatic talks: Resuming diplomatic negotiations or peace talks between the involved parties is a sign of a commitment to resolving the conflict through peaceful means.

Improved cross-border relations: Where relevant, improvements in cross-border relations can signal a de-escalation of the crisis. For example, reopening border crossings or relaxing trade restrictions.

Reduced international tensions: A decrease in international tensions and a reduction in statements or actions by foreign powers that could exacerbate the crisis can indicate an easing of the situation. International mediation efforts can contribute to this signpost.

How to structure an organisational resilience program

ERM International has delivered a range of organisational resilience programs for companies across Australia and the Middle East.

We guide our clients through the following steps:

Scenario analysis: Utilise known information to assess how the expected environment will unfold. This means understanding not just the primary impacts of an event, but the second- and third-order impacts, too. We typically advise exploring three scenarios for any situation to understand boundaries and have confidence in contingency plans:

Expected consequences
Worst case scenario
Best case scenario.

Signpost monitoring: Nominate key indicators for monitoring the changes in the external threat. These may include changes in trends (e.g. variance in GDP growth in comparison to forecast) or specific events (e.g. neighbouring nation deploying military assets).

The frequency of monitoring will depend on the context of the threat; however, effective signposts need to be derived from reliable and trusted sources. See our lists above for more ideas.

Robust business continuity management system: Probably the most familiar element of an organisational resilience program, these systems are usually based off recognised standards (e.g. ISO or NCEMA). They outline the mechanisms of how individual threats to business operations are identified, assessed and treated.

Key to this system are the actions of undertaking a business impact assessment to identify key business processes and developing business continuity plans that outline the specific response for each identified scenario.

In the event of a major disruption, a business will likely stand-up a range of different teams, each with a distinct purpose:

Incident management – overseeing the organisation’s immediate response to manage the situation, including protecting staff
Emergency management – putting in place temporary ‘workarounds’ when disruption occurs
Crisis management – engaging with the authorities and media during a crisis.

What should you check today?

Is your organisation able to adopt a heightened state of readiness to respond to geopolitical tensions?

Ask yourself these questions:

Does the business have its foreseeable scenarios and contingencies in place?
Have you identified possible key indicators and information sources for these metrics?
Do all employees know their role in the event of a major incident, emergency or crisis?
Is your administration up-to-date? Are all contact details and representatives in your plans accurate

ERM International has offices in the United Arab Emirates and Australia, and we have supported many businesses in these regions with their resilience improvement programs.

Browse our services or contact us today for a confidential discussion.