As the world turns its eyes to the Olympics in Rio de Janeiro, athletes and visitors alike are being warned to take precautions against the Zika virus – a flu-like strain that comes with the added risk of crippling birth defects. The situation is so serious that health authorities are urging women in South America to avoid becoming pregnant for a year or more – a demographic anomaly with far-reaching economic implications down the road. Previous pandemics – swine flu, Ebola, SARS, cholera and MERS – have wreaked economic havoc. And the National Science Foundation predicts five new emerging pandemic diseases annually.
Viral outbreaks and their global consequences represent only one of the macro-level trends we’re watching as part of Protiviti’s ongoing PreView global risk series. We evaluate these emerging risks according to the five global risk categories established by the World Economic Forum.
In our most recent issue, in addition to Zika, we examine several other emerging trends – the opportunities and risks of commercial drones, the growing volatility of natural resources, the future of autonomous vehicles, blockchain – the break-through technology pioneered by Bitcoin, and global internet accessibility. Here are the highlights:
- Aerial drones have expanded far beyond surveillance to include crop monitoring, oil and gas exploration, retail delivery, and real estate and insurance appraisals. Key considerations: regulation, privacy and safety. Read more.
- Blockchain, the super-secure cryptocurrency technology, has emerged from the shadows of its Bitcoin origins and is being tested in applications ranging from the automated processing of property titles to password-free interbank transactions. Recently, a blockchain platform called Waves raised $2 million in the first 24 hours of a crowdfunding campaign. Yet, cryptocurrency is still not widely accepted, or well understood. A judge in Miami recently threw out felony charges against a web designer accused of laundering $1,500 in bitcoin. The judge threw out the case because he asserted that bitcoin is not real money. Our advice: Stay tuned.
- Autonomous vehicles are still in the development phase, with Google and Tesla projects dominating the headlines, and Apple said to be close to announcing their own self-driving vehicle. While the bugs are being worked out, researchers predict self-driving cars will be the norm by 2050 – a prospect with far-reaching effects on everything from law enforcement staffing to road construction, public transportation and commercial trucking. As more vehicles become automated, accidents are expected to decrease. Insurers, pay attention.
- Natural resources – Oil, gold, coal, rare earth elements, and water – are experiencing increasing price volatility as scarcity competes with demand, speculation and new technologies to increase uncertainty. This uncertainty poses risks to a wide range of industries, from financial services to transportation, energy, agriculture, technology and the military.
- Internet access is the ticket to ride in a connected economy, and expanding internet access is a global priority for just about everyone who wants to reach customers beyond the digital “old world” (Europe, North America, and parts of Asia-Pacific). Increasing the online audience in the developing world presents exciting new opportunities for companies that may not currently have a way to reach these markets. Facebook and Google are the leaders in internet outreach programs – but they are not the only ones. Key hurdles: availability, affordability, readiness, and relevance of the expanding internet to the new market.
The topics summarized above offer much food for thought and discussion with your boards and strategic teams as you and they look forward. Here’s a sampling of our topics looking ahead:
- Brexit – A developing story, with multiple risk implications. In a future publication, we will look more deeply at the economic, financial and political risks resulting from this decision.
- Artificial intelligence, also known as machine learning, is progressing at a pace that is exciting to some and concerning to others. Pairing machine learning with quantum computing could have effects we can’t even fathom yet, which is why billions of dollars are being invested to mitigate the risk of a “cyberpocalypse.”
- Talent retention is critical to organizations’ ability to execute growth and innovation strategies, but finding and keeping people with the requisite knowledge, skills and core values is becoming increasingly difficult. Building executive “bench strength” by grooming – and holding onto – strong-performing managers is easier said than done. Millennials continue to be a mystery for hiring managers, but their attitudes will be shaping the job market in the decades to come.
We invite you to continue the discussion, in the comment section below, and in your boardrooms and executive meetings. We welcome and value your input.