Nearly half of Irish organisations are happy to take risks but few are using technology to manage these risks. Just 28% see GenAI as an opportunity: PwC Irish and Global Risk Survey
More than 3,900 business and risk leaders around the world including in Ireland were surveyed – from the boardroom and C-suite, and across tech, operations, finance, risk and audit - in PwC’s latest Risk survey to obtain the status and direction of risk management in their organisations. This press release deals with the Irish results.
The survey reveals that nearly half (48%) of Irish respondents said that their organisation pro-actively takes risks to create opportunities (Global: 57%). Just 45% said that they are ‘very confident’ that their organisation can balance growth with managing risk effectively (Global: 40%). Cyber and macro-economic volatility are the top risks: 33% of Irish business and risk leaders believe that their organisations are “highly” or “extremely” exposed to both cyber and macro economic risks - narrowly behind inflationary risks (30%) and digital and technology risks (25%) such as AI.
With GenAI expected to transform business, disrupting and innovating the world of work, only 28% of Irish respondents see GenAI as an opportunity (Global: 60%). In addition, 45% of Irish organisations reported that one of the top factors triggering a review of their organisation’s risk landscape has been as a result of preparing for technology investments, such as cloud to emerging technologies such as GenAI (Global: 57%).
Irish organisations less likely to use technology to manage risk compared to global peers
The survey finds that Irish respondents are less inclined than global peers to use technology to a great extent to manage risk and foster innovation. And where they have invested they are not fully leveraging the technology. For example, just 27% strongly feel that their organisation uses technology and analytics to be better prepared for potential risk (Global: 33%). Just 23% strongly agree that their organisation leverages technology and analytics to drive relevant and timely insights for strategic decision making (Global: 31%). Just 15% strongly agree that their organisation uses technology and analytics to foster a culture of innovation (Global: 30%).
An overwhelming majority (85%) have not yet fully integrated their use of technology and data for their organisational risk management (Global: 73%).
More to do on building business wide risk resilience
The survey highlights some investment in resilience initiatives has taken place in the last 12 months such as investing in digital communications (Ireland:77%; Global: 63%); implementing recovery technology solutions (Ireland: 65%; Global: 55%) and upgrading critical systems (Ireland: 67%; Global: 60%).
However, less than four out of ten (38%) stated that they have a business wide technology strategy, including investing in technology specifically to drive resilience and risk management (Global: 53%).
Less than a quarter (23%) strongly agree that their organisation actively builds resilience across their business (Global: 30%). There needs to be greater emphasis on resilience initiatives: just 28% are planning to expand their network of key suppliers in the year ahead as part of their business continuity plans (Global: 35%) and just 35% are planning to establish a resilience team with members from functions like business continuity, cyber, crisis management and risk management (Global: 35%).
Regarding cyber risks, just 25% are planning to upgrade critical systems so that they are more resilient against cyber attacks in the year ahead (Global: 30%).
Few are planning to invest in advanced analytics and AI to navigate risk- global peers doing more
Less than one fifth (17%) of Irish respondents stated that they are currently using advanced analytics or predictive modelling to a very large extent to identify and evaluate potential risks (Global: 22%). A similar proportion (18%) are implementing real-time monitoring systems to a very large extent for timely risk identification (Global: 23%). Just one in ten (10%) are using AI and machine learning to a very large extent for automated risk assessment and response (Global: 20%).
Even more worrying is that less than one in three (30%) are planning to invest in analytics and business intelligence tools to navigate risk over the next 1-3 years (Global: 47%) and just 35% plan to invest in AI, machine learning and automation technologies (Global: 49%).
Irish organisations have some catching up to do with global peers when it comes to building resilience and using technology and AI to aid risk management. Technology change is happening at a pace like we have never seen before. To get the full benefits of technology investment it needs to be fully integrated across the organisation and have the people with the right skills so no opportunities are missed.
In a world that is persistently in a state of flux, it is clear that organisations need to transform, with new and emerging technologies playing a critical role in that transformation. The survey highlights that if organisations don’t take risks, they will not progress. So if organisations are to grow, build resilience, and see sustained, long-term outcomes, they need to have a proactive approach to risk, an enterprise-wide risk strategy and strong alignment on risk appetite between teams.
Gap in capabilities
While there is a clear ambition among most organisations to take a more tech-powered approach to risk, there is a gap in capabilities and execution: only 5% of Irish respondents are already using advanced and predictive analytics, cutting-edge tech and data for continuously refining and innovating risk-management (Global:10%).
The survey suggests that there is also a skills deficit. Just 17% strongly agreed that their organisation provides employees with the right skills to better enable them to solve complex problems (Global: 31%). Only a quarter (25%) strongly agreed that upskilling internal teams to be better prepared for potential risks is a priority (Global: 31%). Just one in two (50%) plan to invest in training and upskilling on technology and data over the next 1-3 years (Global: 46%).
Given all of the global uncertainties, risk management is becoming more challenging, amplified by the increasing pace and impact of technology change. With the right skills and technology, organisations have a great opportunity to reinvent themselves, adapt to constant change and tackle the many risks to both protect and create value for their businesses.
By Andy Banks, PwC Ireland Risk Leader