Information technology is the single biggest source of risk for companies today, according to a survey of top executives in the U.S., U.K., Japan, Germany, France and Italy. The annual Swiss Re Corporate Risk Survey found that executives rank IT at 6.00 on a risk scale of 0 to 10, where 10 indicates “extreme concern.” Coming in second was foreign trade, at 5.29, followed by corporate governance, at 5.22. IT was the only risk source that was rated as one of the top three risks by executives in all six of the countries. It came in at number one for U.S., U.K. and Japanese managers as well as for managers in the manufacturing and financial industries. Concerns about computer-related risk continue to increase, moreover, with 60% of executives saying that their fears about IT are greater today than they were a year ago.
Nick,
What about the risk from reading and believing poorly designed studies?
Scroll down to the end of this report and look at the design of this “study.” The results are statistically meaningless. Only 60 CEOs were interviewed (10 from each country). There’s no indication of the variance of the answers, or who was interviewed, or how large the companies were, or what sectors the companies represent. And, really, am I supposed to believe that busy CEOs from “top-tier global corporations” agreed to sit down for an hour long interview with an insurance company?
Joe, Thanks. That’s what I get for not reading the appendix. You’re right – the statistics are basically meaningless. It’s an anecdotal study. Mea culpa. Nick
(You’d think, by the way, that a major global insurance company might show a little care in throwing statistics around in public.)
I see an inherent bias in this, as Swiss Re is in the risk business (aka re-insurance). Their product is risk, and making things sound worse than they are feeds into revenues. I’d also like to see how these various categories of risk have fared over the last decade. Has IT concern always been the highest, or just in the past year?
What about IT concerns them? Is it operational, the constant rate of change, or the insecurities in complex systems? Page 19 gets into this a bit, but glosses over details. Page 19 suggests the execs are just parroting whatever is in the media at the time.
I’d say this pertains to running a Microsoft house. The risk factors are totally different when IT knows what it’s doing.
Hey, Sam, your ax is sharp. No need to keep grinding it.
Nicholas, why don’t you rename this blog posting to “Does IT Research matter?”.
Don’t get me started on this topic.. IT isn’t risky. What makes IT risky is poor management.
That’s right… POOR MANAGEMENT…
There’s an old saying, “The fish rots from the head.” Piss-poor management starts at the top (i.e., C-level) and works its way down and effects EVERY aspect of a company’s growth.
Here are some “items” I have observed in my days:
1) Executives who try to cut corners in their IT infrastructure because the only thing they see is that IT is an “overhead expense item that needs to be trimmed in order to increase the bottom line.” In the end, they wind up spending more money to fix the problems associated with the corners they cut.
2) Executives, mainly CTO’s, who are more concerned with making a name for themselves rather doing WHAT IS BEST FOR THE COMPANY.. You know, LONG-TERM thinking.
3) Poor middle-managers who are promoted from within despite their lack of management skills. These managers also have a condition known as the “Silo Mentality”: not focusing on the STRATEGIC PLAN of the company. Rather, they are more concerned with making a name for themselves. (See item 2).