As former CEO Jack Welch as soon as mentioned, “If the speed of change on the surface exceeds the speed of change on the within, the top is close to.” Jim DeLoach of Protiviti shares insights from 1,540 world leaders displaying that organizations are prioritizing buyer expertise, cybersecurity and AI deployments of their long-term methods, indicating a shift towards built-in decision-making that encompasses instant and future alternatives and dangers.
For 13 years, Protiviti and NC State College’s ERM Initiative have researched the highest dangers enterprise leaders face globally. This yr, the examine highlights alternatives in addition to dangers, encouraging organizations to reply proactively to rising developments, market shifts and evolving buyer expectations. Corporations that target unlocking alternative usually tend to innovate, adapt and develop.
Our 14th annual report shares insights from 1,540 board members and C-suite executives worldwide. These findings ought to encourage efficient C-suite and boardroom discussions as leaders search to create strategic worth in these difficult instances.
Abstract of total world outcomes
Regardless of latest uncertainty and world shifts, enterprise leaders are ready to innovate, kind strategic partnerships and plan for long-term progress. The best danger now’s sustaining the established order and failing to behave.
There’s sturdy optimism for income progress, with the ecosystem a strategic precedence
Over the following two to 3 years, almost seven in 10 board members and executives agree that, contemplating present situations, there are important alternatives to extend revenues. Greater than six in 10 leaders indicated their organizations plan to develop their strategic alliances and partnerships over the identical interval. Worthwhile progress is the secret.
AI is each a transformative progress driver and a posh problem
Practically one in three leaders are prioritizing its integration, but AI is taken into account a prime world danger. Rising issues about IT infrastructure and expertise readiness hinder efficient deployment, whereas cybersecurity dangers associated to AI stay distinguished.
Cybersecurity is the highest world danger and funding precedence
Not solely are cyber threats ranked as the highest world near-term danger, however third-party dangers (that are linked to cyber issues) rank second. The priority of enterprise leaders concerning the rising sophistication of the cyber risk panorama is mirrored within the prioritization of cybersecurity in danger assessments, strategic selections and important funding allocations. The approaching emergence of quantum computing poses formidable threats to cybersecurity and knowledge safety requirements.
Expertise challenges are evolving however not disappearing
Expertise dangers proceed to be prime of thoughts amongst board members and C-suite leaders globally, with points surrounding workforce upskilling and the provision of expert labor remaining important, significantly given the anticipated affect of AI on job roles and workforce transformation. The speedy adoption of AI is reshaping job roles and the required skillsets, creating pressing wants for upskilling and reskilling. That danger has elevated considerably year-over-year as executives should navigate the complexities of cultural change, worker morale and a softening labor market amid these technological developments.
Issues in regards to the economic system and trade-related challenges and their affect on world markets are prime 10 near-term danger issues
Commerce-related challenges broke into the highest 10 listing this yr, whereas uncertainties linked to rates of interest and inflation proceed to create causes for pause amongst respondents.
Buyer expertise, cyber and AI are prime long-term strategic focus areas
Organizations are prioritizing buyer and competitors dynamics, safety and privateness and AI deployments of their long-term methods, indicating a shift towards built-in decision-making that encompasses each instant and future alternatives and dangers.
Pursuing strategic progress alternatives
Progress allows companies to adapt, stay aggressive and reply to adjustments in markets, applied sciences and buyer wants. Regardless of the uncertainties within the market, our survey outcomes present that enterprise leaders preserve an optimistic outlook on progress prospects. Moreover, as accelerators of progress, innovation and transformation initiatives are driving these alternative pursuits.
Addressing and investing in areas like cybersecurity, AI, knowledge administration and third-party oversight replicate a proactive mindset targeted on constructing resilience and unlocking worth, and are important to navigate the present danger panorama. Based on our survey, enterprise course of enhancements, possible pushed by expertise transformation, and infrastructure modernization are two vital funding priorities for organizations in regard to their near-term strategic and operational danger issues. This displays a proactive response to a altering market. As former CEO Jack Welch as soon as mentioned, “If the speed of change on the surface exceeds the speed of change on the within, the top is close to.”
Managing AI’s transformative affect
AI is seen by many enterprise leaders as vital to unlocking effectivity, personalization, improvements and the flexibility to scale — all drivers of recent income streams and enlargement. However AI additionally introduces challenges — knowledge privateness, algorithmic bias, regulatory compliance and workforce disruption amongst them. Leaders are attempting to stability pace of adoption with danger administration and accountability.
As evidenced in our survey outcomes, AI implementation now ranks sixth amongst world near-term issues for board members and executives. The highest 5 AI-related dangers famous by our survey pertain to publicity of the underlying knowledge to cyber assault; integrating AI with the prevailing applied sciences, enterprise processes and workforce; equipping the workforce to appreciate AI’s worth proposition; failing to deploy AI at a aggressive tempo; and lack of governance and accountability for AI deployments. The message is obvious: As leaders are underneath strain to innovate rapidly, they need to additionally guarantee AI’s accountable, safe, compliant and moral use. AI implementation is a balancing act.
Understanding near-term danger issues
Our respondents rated the chance atmosphere their organizations might be going through with respect to attaining their efficiency objectives over the following two to 3 years as barely larger this yr than final yr. An examination of the highest 10 danger outcomes searching the following two to 3 years gives insights as to why the chance atmosphere is barely elevated. Collectively, these near-term dangers characterize headwinds to opportunity-seeking initiatives, as six of them have been rated larger year-over-year than final yr.
5 of those near-term dangers are operational in nature, signaling govt deal with inner resilience and executional reliability. These dangers — cyber threats, third-party dependencies, legacy IT infrastructure, rising IT and AI implementation challenges, and talent acquisition and retention — are deeply interconnected and replicate the strain organizations face to ship constant efficiency in a digitally disrupted atmosphere.
Three of the highest 10 near-term dangers replicate macroeconomic issues — financial situations, labor availability and world commerce coverage shifts — that may disrupt strategic momentum. Whereas these dangers are considerably exterior the group’s management, their affect on value constructions, provide chains and market entry is profound.
Although fewer in quantity, strategic dangers — rising applied sciences requiring workforce transformation and regulatory fragmentation — carry high-impact potential. These dangers problem the group’s skill to pivot, innovate and comply in a fast-changing world.
Anticipating long-term dangers
We requested members to establish and rank the highest three danger themes that they imagine their organizations are prone to contemplate most when evaluating their methods and making investments over the following 10 years. We formulated 12 broad themes encompassing the 28 particular danger areas we examined over the close to time period and sure different issues to simplify the survey members’ long-term danger evaluation.
Based on the survey, the primary long-term issues for organizations are prospects and competitors, safety and privateness and AI deployments, reflecting a transparent emphasis on sustaining aggressive relevance and stakeholder belief in a quickly evolving digital panorama. These three themes have been adopted by long-term issues with respect to markets and economies and expertise challenges, suggesting that executives acknowledge that profitable AI integration relies upon not solely on technical infrastructure but in addition on having the suitable expertise to information and govern these instruments and assimilate them into the enterprise.
Figuring out strategic funding priorities
We requested our survey members to rank the highest three strategic priorities through which their organizations are prone to make investments probably the most associated to sure of the aforementioned strategic and operational danger points over the following two to 3 years. Their prime 5 funding priorities have been cybersecurity, enterprise course of enhancements, infrastructure modernization, knowledge privateness and the shopper expertise.
These funding priorities combine worth creation with danger administration, with a deal with cybersecurity, third-party reliance, legacy IT points and knowledge privateness. Modernizing infrastructure and bettering enterprise processes not solely tackle dangers but in addition help progress. Investing in these areas sharpens long-term worth by encouraging a holistic understanding of the group’s targets, alternatives, markets, ecosystem and dangers. As strategy-setting is an evergreen course of, organizations ought to establish rising alternatives and dangers repeatedly, align useful resource allocation accordingly and maintain versatile methods that facilitate adapting to inevitable change.
Last takeaways
This yr’s survey of 1,540 world leaders signifies optimism for progress regardless of financial, workforce and technological obstacles. The report highlights the significance of balancing strategic progress with resilience by integrating agility, foresight and collaboration. We hope that this analysis will catalyze strategic conversations within the C-suite and boardroom and help leaders in constructing organizations that thrive amid uncertainty and inevitable change.
As former CEO Jack Welch as soon as mentioned, “If the speed of change on the surface exceeds the speed of change on the within, the top is close to.” Jim DeLoach of Protiviti shares insights from 1,540 world leaders displaying that organizations are prioritizing buyer expertise, cybersecurity and AI deployments of their long-term methods, indicating a shift towards built-in decision-making that encompasses instant and future alternatives and dangers.
For 13 years, Protiviti and NC State College’s ERM Initiative have researched the highest dangers enterprise leaders face globally. This yr, the examine highlights alternatives in addition to dangers, encouraging organizations to reply proactively to rising developments, market shifts and evolving buyer expectations. Corporations that target unlocking alternative usually tend to innovate, adapt and develop.
Our 14th annual report shares insights from 1,540 board members and C-suite executives worldwide. These findings ought to encourage efficient C-suite and boardroom discussions as leaders search to create strategic worth in these difficult instances.
Abstract of total world outcomes
Regardless of latest uncertainty and world shifts, enterprise leaders are ready to innovate, kind strategic partnerships and plan for long-term progress. The best danger now’s sustaining the established order and failing to behave.
There’s sturdy optimism for income progress, with the ecosystem a strategic precedence
Over the following two to 3 years, almost seven in 10 board members and executives agree that, contemplating present situations, there are important alternatives to extend revenues. Greater than six in 10 leaders indicated their organizations plan to develop their strategic alliances and partnerships over the identical interval. Worthwhile progress is the secret.
AI is each a transformative progress driver and a posh problem
Practically one in three leaders are prioritizing its integration, but AI is taken into account a prime world danger. Rising issues about IT infrastructure and expertise readiness hinder efficient deployment, whereas cybersecurity dangers associated to AI stay distinguished.
Cybersecurity is the highest world danger and funding precedence
Not solely are cyber threats ranked as the highest world near-term danger, however third-party dangers (that are linked to cyber issues) rank second. The priority of enterprise leaders concerning the rising sophistication of the cyber risk panorama is mirrored within the prioritization of cybersecurity in danger assessments, strategic selections and important funding allocations. The approaching emergence of quantum computing poses formidable threats to cybersecurity and knowledge safety requirements.
Expertise challenges are evolving however not disappearing
Expertise dangers proceed to be prime of thoughts amongst board members and C-suite leaders globally, with points surrounding workforce upskilling and the provision of expert labor remaining important, significantly given the anticipated affect of AI on job roles and workforce transformation. The speedy adoption of AI is reshaping job roles and the required skillsets, creating pressing wants for upskilling and reskilling. That danger has elevated considerably year-over-year as executives should navigate the complexities of cultural change, worker morale and a softening labor market amid these technological developments.
Issues in regards to the economic system and trade-related challenges and their affect on world markets are prime 10 near-term danger issues
Commerce-related challenges broke into the highest 10 listing this yr, whereas uncertainties linked to rates of interest and inflation proceed to create causes for pause amongst respondents.
Buyer expertise, cyber and AI are prime long-term strategic focus areas
Organizations are prioritizing buyer and competitors dynamics, safety and privateness and AI deployments of their long-term methods, indicating a shift towards built-in decision-making that encompasses each instant and future alternatives and dangers.
Pursuing strategic progress alternatives
Progress allows companies to adapt, stay aggressive and reply to adjustments in markets, applied sciences and buyer wants. Regardless of the uncertainties within the market, our survey outcomes present that enterprise leaders preserve an optimistic outlook on progress prospects. Moreover, as accelerators of progress, innovation and transformation initiatives are driving these alternative pursuits.
Addressing and investing in areas like cybersecurity, AI, knowledge administration and third-party oversight replicate a proactive mindset targeted on constructing resilience and unlocking worth, and are important to navigate the present danger panorama. Based on our survey, enterprise course of enhancements, possible pushed by expertise transformation, and infrastructure modernization are two vital funding priorities for organizations in regard to their near-term strategic and operational danger issues. This displays a proactive response to a altering market. As former CEO Jack Welch as soon as mentioned, “If the speed of change on the surface exceeds the speed of change on the within, the top is close to.”
Managing AI’s transformative affect
AI is seen by many enterprise leaders as vital to unlocking effectivity, personalization, improvements and the flexibility to scale — all drivers of recent income streams and enlargement. However AI additionally introduces challenges — knowledge privateness, algorithmic bias, regulatory compliance and workforce disruption amongst them. Leaders are attempting to stability pace of adoption with danger administration and accountability.
As evidenced in our survey outcomes, AI implementation now ranks sixth amongst world near-term issues for board members and executives. The highest 5 AI-related dangers famous by our survey pertain to publicity of the underlying knowledge to cyber assault; integrating AI with the prevailing applied sciences, enterprise processes and workforce; equipping the workforce to appreciate AI’s worth proposition; failing to deploy AI at a aggressive tempo; and lack of governance and accountability for AI deployments. The message is obvious: As leaders are underneath strain to innovate rapidly, they need to additionally guarantee AI’s accountable, safe, compliant and moral use. AI implementation is a balancing act.
Understanding near-term danger issues
Our respondents rated the chance atmosphere their organizations might be going through with respect to attaining their efficiency objectives over the following two to 3 years as barely larger this yr than final yr. An examination of the highest 10 danger outcomes searching the following two to 3 years gives insights as to why the chance atmosphere is barely elevated. Collectively, these near-term dangers characterize headwinds to opportunity-seeking initiatives, as six of them have been rated larger year-over-year than final yr.
5 of those near-term dangers are operational in nature, signaling govt deal with inner resilience and executional reliability. These dangers — cyber threats, third-party dependencies, legacy IT infrastructure, rising IT and AI implementation challenges, and talent acquisition and retention — are deeply interconnected and replicate the strain organizations face to ship constant efficiency in a digitally disrupted atmosphere.
Three of the highest 10 near-term dangers replicate macroeconomic issues — financial situations, labor availability and world commerce coverage shifts — that may disrupt strategic momentum. Whereas these dangers are considerably exterior the group’s management, their affect on value constructions, provide chains and market entry is profound.
Although fewer in quantity, strategic dangers — rising applied sciences requiring workforce transformation and regulatory fragmentation — carry high-impact potential. These dangers problem the group’s skill to pivot, innovate and comply in a fast-changing world.
Anticipating long-term dangers
We requested members to establish and rank the highest three danger themes that they imagine their organizations are prone to contemplate most when evaluating their methods and making investments over the following 10 years. We formulated 12 broad themes encompassing the 28 particular danger areas we examined over the close to time period and sure different issues to simplify the survey members’ long-term danger evaluation.
Based on the survey, the primary long-term issues for organizations are prospects and competitors, safety and privateness and AI deployments, reflecting a transparent emphasis on sustaining aggressive relevance and stakeholder belief in a quickly evolving digital panorama. These three themes have been adopted by long-term issues with respect to markets and economies and expertise challenges, suggesting that executives acknowledge that profitable AI integration relies upon not solely on technical infrastructure but in addition on having the suitable expertise to information and govern these instruments and assimilate them into the enterprise.
Figuring out strategic funding priorities
We requested our survey members to rank the highest three strategic priorities through which their organizations are prone to make investments probably the most associated to sure of the aforementioned strategic and operational danger points over the following two to 3 years. Their prime 5 funding priorities have been cybersecurity, enterprise course of enhancements, infrastructure modernization, knowledge privateness and the shopper expertise.
These funding priorities combine worth creation with danger administration, with a deal with cybersecurity, third-party reliance, legacy IT points and knowledge privateness. Modernizing infrastructure and bettering enterprise processes not solely tackle dangers but in addition help progress. Investing in these areas sharpens long-term worth by encouraging a holistic understanding of the group’s targets, alternatives, markets, ecosystem and dangers. As strategy-setting is an evergreen course of, organizations ought to establish rising alternatives and dangers repeatedly, align useful resource allocation accordingly and maintain versatile methods that facilitate adapting to inevitable change.
Last takeaways
This yr’s survey of 1,540 world leaders signifies optimism for progress regardless of financial, workforce and technological obstacles. The report highlights the significance of balancing strategic progress with resilience by integrating agility, foresight and collaboration. We hope that this analysis will catalyze strategic conversations within the C-suite and boardroom and help leaders in constructing organizations that thrive amid uncertainty and inevitable change.
