Risk Strategy
Our clients face an array of security, political and social threats to business viability in developed, emerging and frontier markets. Success depends on risk planning within a coherent policy framework, balanced against a realistic assessment of threats and opportunities.
We like to talk about risk strategy in terms of ‘αlpha’ – a term used in investing to describe an investment strategy’s ability to beat the market, or its ‘edge’. We help our clients beat the threats.
Here are two recent examples of our recent work:
Security Policy and Mitigation - Africa
Rapidly spreading insurgency in the Sahel threatened the viability of our client’s established businesses in several Sahelian countries. The client manages an extremely large number of telecoms network assets. The first task was to understand the emerging threat in detail and to estimate a range of plausible scenarios for how the threat was likely to develop. This allowed our client to make decisions about its strategic positioning in each of the region’s markets.
Many of the key findings from the first phase were used to develop new policy and operational standards for the client’s security operations across its sub-Saharan Africa market. The key principle was to balance management’s oversight of risk with an appropriate degree of operational-level autonomy. Most importantly, this greatly enhanced the Global Head of Security’s ability to ‘see’ the business’s continental risk profile, and to engage with emerging issues in a more targeted way.
Market Entry αlpha – South Asia
Our client was a European mining services company with a strong interest in entering the South Asian market. However, the key region of interest is affected by a long-running separatist insurgency, social instability, and weak central government control. Our client was rightly concerned that a combination of social and security threats could threaten business viability.
Our long-term presence in the region of interest enabled us to quickly access hard-to-reach intelligence. In addition to remote analysis, we visited the region to conduct primary-source research – this generates far better insights than desk-based research and is always our preferred approach when possible.
Despite the prevalence of extreme-rated threats, we presented the client with a range of risk management options that supported a ‘go’ decision, based on our high degree of confidence in the most likely future risk scenarios, balanced with our expert assessment of mitigation strategies.