Authored by: Volker von Widdern, The Institute of Risk Management South Africa (IRMSA) Risk Intelligence Committee Member

It is possible that the increasing prevalence of diabetes in South Africa may become an even greater challenge than the HIV epidemic.

The development of anti-retro viral clinical responses to HIV have substantially reduced exposure to HIV, but it does not appear that similar clinical advances can be achieved in the next 10 years to mitigate the impacts of diabetes.

Since human resources are usually the highest priority and cost factor in most organisations, the consequential impact of diabetes on the productivity and development or retention of intellectual property, will face significant risks.

The increasing prevalence of diabetes in South Africa is unfortunately another outcome of the high levels of polarisation in our population. Eating patterns and increasing urbanisation are accelerating the prevalence of diabetes, and these social drivers are a reflection of our high levels of unemployment.

Should employers invest in strategies that reduce employee exposure to diabetes? It can be argued that such investments have no reliable return because employees can easily move to other businesses.

However, it is also true that well aligned and productive employees are by far the most differentiated source of company performance.

What could the scenarios be if no investment is made in reducing the prevalence of diabetes? It is then likely that employee turnover will increase and there will be an artificial demand for employees that have less risk or exposure to diabetes.

There are several research articles that demonstrate the sharp increase and high prevalence of diabetes in SA, and one example from which a short extract is shown below, is:

The prevalence of type 2 diabetes in South Africa: a systematic review protocol
Carmen Pheiffer, Victoria Pillay-van Wyk, Jané D Joubert, Naomi Levitt, Mweete D Nglazi, Debbie Bradshaw
“The prevalence of diabetes is rapidly increasing in South Africa. In 2009, approximately 2 million (9%) people aged 30 years and older had diabetes, increasing almost twofold since 2000 when Bradshaw et al reported a prevalence of 5.5%.

Several factors such as the ageing population, economic transition and urbanisation associated with nutrition transition and obesity have contributed to the increased diabetes prevalence.

In 2000, it was estimated that 87% of diabetes cases in South Africa were attributed to excess body weight.
This is concerning since in 2013 ~38% of men and ~69% of women in South Africa were considered overweight or obese.

In 2015, the global burden of disease study estimated that high body mass index and hyperglycaemia, ranked as the second and third leading risk factors, respectively, after unsafe sex, for early death and disability in South Africa.

Diabetes, due to its association with several microvascular and macrovascular complications, places a significant burden on the South African health system.

In 2009, it was estimated that diabetes caused about 8000 new cases of blindness and 2000 new cases of amputations annually.

A national burden of disease study in 2000 reported that diabetes accounted for approximately 14% of cases of ischaemic heart disease, 10% of stroke, 12% of hypertensive disease and 12% of renal disease.

Furthermore, the indirect costs of diabetes are high. Diabetes in Africa affect mainly working-aged people between 40 and 60 years of age placing an added burden on the economy due to work absenteeism and decreased productivity.

South Africa is battling a quadruple burden of disease due to high rates of infectious diseases, non-communicable disease, maternal and child mortality, and injury-related disorders, thus have limited resources to meet the increased health and economic costs of diabetes.”

ENDS

MEDIA CONTACT: Rosa-Mari, 060 995 6277, [email protected], www.atthatpoint.co.za 
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Authored by: Sidney Mongala, CRM Prac Member at The Institute of Risk Management South Africa (IRMSA)

The way we do business today is 1000 times advanced than it was done in the last millennium, 100 times advanced than was done in the last century and 10 times advanced than was done in the last decade.This is an indication of how rapid life changes.

The more our lives are advancing, the more the need for advanced ways of doing things, the more complex the risk environment evolves.

This is therefore the driver of future business successes and determinant of future business traits and trends. As futurists and trend analysts project the future ahead, businesses should likewise be positioned for the advanced and sophisticated ways of doing business.

Future Chief Risk Officers (CRO) should thus not be left behind but partner with businesses in crafting future fit business models and strategies.

Thus competing with AI and Robotics in this 4IR era which might lead to diminishing credibility and relevance of human intervention and interface.

The way we do business has changed such that we don’t use much physical money anymore to do business as we venture into this 4IR era.

Cryptocurrencies are here to disrupt the old way of transacting and they are the future waves of doing business.
Likewise CROs should continue evolving the way they are doing things and improving their competencies to feed the new waves of doing business and be able with reasonable certainty to advice businesses to be competitive and business savvy to capture the rapidly changing 4IR market share.

With these advancements in the way business is done these days, surely I can safely say disappearing are the days of our lives wherein CROs:

• Have a corner office waiting for a bell to ring to attend to problems;
• Compile risk reports and present them to Risk and Audit Committees and Boards;
• Are required to do anything and everything that could not be done elsewhere like Business Continuity Plans (BCPs), Fraud Prevention Plans, Investigations, Compliance, etc;
• Are called after strategic directions and plans have already been finalised and are expected to identify and analyse risks;
• Are carriers of jargon filled risk registers, reports, dashboards, etc;
• Are seen as “Mr know it all” and find themselves running around fixing anything and everything they have identified as risky; and
• Have the last item in an agenda that is ‘taken as read’ or ‘will be considered in the next meeting’.

Thus, the future relevance of CROs lie in the strategic partnering and value add to businesses.

Future CROs therefore need to position themselves to be business partners and advisers on business strategies, operations and decisions on the go; “Just In Time (JIT) Risk Management Advisory System and Processes”.

The CROs of the future should therefore possess the following traits:

• Be mind full of and align to the business vision, mission, direction, strategy and operations including but not limited to future advancements and complexities of doing business;
• Must be visible and embracing of the entire business vision, mission, direction, strategy and operations;
• Have sentiments around opportunities for growth and/or service delivery exploitations;
• Get involved and invested in the strategic projects from initiation to execution to legacy;
• Walk, talk, sleep, eat and live everything about risks and opportunities;
• Be the voices that are heard and supported by everyone;
• Inspire, nurture and bring along direct supports;
• Carry the best knowledge to advice the entire business’s current and future risks and opportunities;
• Be active participants in strategic decision making structures, meetings, etc;
• Act as Anti-Virus software to influence and protect the entire business systems and processes from disruptive technologies in this 4IR era; and
• Have the audacity and steadfast to point the hidden, speak the unspoken and address the most hard-felt truths about business lessons learned and failures, flaws, improprieties, etc.

Future CROs are those that will not wait for risk agenda items to be included in strategic and operational meetings but influence consideration of risks in all strategic decisions and operations.

The future CROs should be engaged in every discussions, planning, decisions, projects, etc. for growth in business and/or service delivery.

Future CROs should be future risk visionaries of businesses and be able to advice of the future fit business strategies, decisions and plans in the 4IR wave of doing business.

Although future CROs are not expected to be “Drs Of All Problems and Mr/Ms/Mrs Know It All”, future CROs should be able to know where the business is going and be able to advice throughout the business journey.

The future CROs should be the library of risks and opportunities required to build future proof strategies for successful, growing and service delivery savvy businesses.

Like Artificial Intelligence (AI) and 4th Industrial Revolution, future CROs should:

• Be the backbone of their organisations’ intelligence to predict the future and advice on the perfect alignment to future business directions;
• At least have answers for all key decisions;
• Position themselves to fit and thrive in the AI and 4IR era;
• Upgrade and update processes to be responsive to the rapidly changing and disruptive technologies
• Be the transformation their organisations need to meet future business needs;
• Be readily available and prepared to advice on new business ideas; and
• Be able to timely gauge circumstances and advice on solutions.

For businesses to be future business savvy, it will be critical that they place the right value and investment in the advancement of future risk management systems and processes and ensure that these systems and processes are driven by capable hands of future-programmed CROs.

This means that businesses should understand and put risk management as part and parcel of everything they do lest they fall on a double sharp-edged sword that cut the throats of big businesses such as Bearings Bank, Washington Mutual Bank, VBS Mutual Bank, WorldCom, Enron, Lehman Brothers, Arthur Andersen, etc.

A lot of businesses that are not fine-tuning to the new wave of doing business will suffer the consequences of business intelligence risks such as AI and 4IR in the next ten to fifty years.

These include mostly the labour intensive businesses, ICT businesses that have heavily invested in old ICT Infrastructure, Financial Institutions that are in denial of the arrival of the cryptocurrencies and other disruptive technologies, and so forth.

Likewise, to have future CROs that are equivalent to the old technology and are stuck in the old and safe way of doing business will not survive the use of rapidly evolving and competitive 4IR era of Robotics, AI, Big Data, IoT, etc.

This will be like running a financial institution wherein people queue for cash withdrawals and deposits in this era of EFTs, Banking Apps, Smart Banking, Cradles Transacting, cryptocurrency, virtual banking, etc.

​These kinds of future CROs will fall with their business ideas and may find it very difficult to fit anywhere in the future wave of doing business.

Another key question to be answered is “how prepared and advanced will our education system be to ensure that future CROs are relevant and fit into the rapidly changing business environment”.

How will the bridge between our education system and the future wave of doing business be closed in order to supply the business world with the bright minds for future fit CROs.

How prepared and adaptable is the education system to fit the future way of doing business and thus bridging the gap between the demand and the supply for future fit CROs, risk managers and assurance providers.

Let me leave you by saying “If we don’t take care of the future, the future will take care of us and we will suffer the consequences”.

ENDS

MEDIA CONTACT: Rosa-Mari, 060 995 6277, [email protected], www.atthatpoint.co.za 

For more information on IRMSA please visit:
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 Authored by: Andrew Pike, Fellow of the Institute of Risk Management South Africa (IRMSA)

In August 1991, excited holiday-makers boarded the Oceanos, a Greek-owned passenger vessel, at East London for the trip of a lifetime.

Despite a raging storm, the Captain ordered the ship to set sail for Durban. Hurricane force winds and giant rogue waves battered the ship.

About 4 hours after she had set sail and when she was a couple of miles off a remote stretch of the Transkei coast, the auxiliary engine room was breached and the ship started taking huge volumes of water.

Panicking senior crew members scrambled into lifeboats, leaving the ship’s evacuation to on-board entertainers and crew staff. Women and children clambered aboard life boats which were then launched into the monstrous seas, but eventually all operational or launch-able life boats had been used and 221 passengers were left stranded aboard the sinking ship.

The South African Air Force, in cooperation with the Navy, then launched its biggest rescue operation in history to airlift passengers off the stricken vessel, battling 70 knot winds and waves in excess of 20 meters.

Passengers who had been evacuated in life boats were eventually all picked up by merchant ships and fishing vessels in the area.

The airlifted passengers were removed from the ship and taken to a local hotel about 2 to 3 miles away from the ship. During the helicopter airlift, the Captain of the ship also deserted all of the passengers and remaining crew, thus leaving the ship completely in the hands of civilians and junior crew members.

Eventually, about an hour before the ship sank and 17 hours after the drama started, all passengers had been safely evacuated. It was against all odds that no one perished in the disaster. Stories abound of heroism, cowardice, commitment and the emergency response of all involved.

However, the reality is that the Department of Transport itself had never planned for a disaster on this scale and certainly no one in South Africa had ever given any thought to the possibility of a passenger ship sinking.

This was the materialization of a risk on such a grand scale in maritime terms that it was never in any one’s contemplation and, had risk management been the art form then that it is nowadays, a sinking passenger liner would probably not have been on any one’s risk register.

And yet, despite mountainous seas, a cowardly crew, a shortage of life boats and everything else, South Africa pulled together and effected what was arguably the most successful maritime rescue in history.

Nowadays, with a keener sense of risk identification, most major organizations have some level of preparation in respect of most risks.

But what do we do about the risks which were just never seen coming? Given the current accelerated pace of technological growth, climate change, uncertain financial markets and the like, it seems inevitable that at some stage most organizations are going to be faced with a risk they hadn’t thought about.

For me, the common thread running through the Oceanos rescue was a combination of the following factors which made the rescue the success that it was:

People and skills:

• There were people in all of the key response areas (Air Force, Maritime Rescue Co-ordination Centre and so on) who were capable of making sensible, but more importantly, bold decisions.
• Those people were all empowered to make those decisions i.e. they did not need to defer to some higher power before the decision could be made.
• It is one thing to have the right people in the right places, but unless they have sufficient skills and training, they will only be able to work within the realms of what they know. Where they have a depth of training which will enable them to extend their skills to any situation, no matter how unforeseen, the organization will have the necessary resilience.
• Even where they do not have specific skills, sufficient basic skills must be in place to enable people to work efficiently well outside of their comfort zones. In the Oceanos rescue, the helicopter crews which flew from the hinterland did not have maritime rescue training in place, but they were nonetheless able to perform admirably.

Resources:

• Remarkably, sufficient resources were available at the time. Somehow or other the Defence Force managed to mobilize sufficient helicopters, divers, air crew and naval vessels which were sufficient for the job.
• The maritime rescue systems in place were able to call on resources which were not on any asset list, but were available nonetheless. Those were the civilian merchant vessels which came to the rescue. By convention, ships at sea are required to come to the aid of ships which are in trouble. How much stronger might we as a country be if that sort of convention existed amongst companies and organizations, rather than the prevailing attitude of “there but for the grace of God go I” and watching our competitors sink?

Systems:

• Although there was no plan anywhere in the country for a sinking passenger ship, there were nonetheless systems of communication, response systems, support services like the NSRI, emergency services and so on.
• Provided there are systems in place which can speak to virtually any eventuality, they will in most instances prove sufficiently resilient, even for risks which weren’t expected or foreseen.

Commitment:

• There were on my reckoning over 50 different organizations involved at one level or another in the rescue operation. Every one of them was totally committed to rescuing the lives which were at risk, regardless of personal risk, safety or indeed legality.
• The hinterland helicopter crews in fact flew unlawfully to the site of the rescue and participated in the rescue unlawfully because they had neither the necessary rescue equipment nor training. Nonetheless, they were so committed to a bigger cause that they worked outside of their normal parameters.
• Looking at the operation in its entirety, that description can be given to most people who were involved: divers, entertainers, ships agents, air crew and the rest. Within any organization, unless the people in that organization are completely bought into the bigger vision of the organization and therefore willing to commit beyond the ordinary, the organization remains vulnerable to risks which are not on the register.

In conclusion, whilst Risk Registers and Risk Identification are becoming more sophisticated, it is likely that, as things change, organizations will not be able to anticipate and prepare for every risk.

However, if the basics and essentials are in place, what organizations will do is build sufficient resilience to address the disasters which may befall them.

ENDS

MEDIA CONTACT: Rosa-Mari, 060 995 6277, [email protected], www.atthatpoint.co.za 
​
For more information on IRMSA please visit:
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Twitter: https://twitter.com/IRMSAInsight
Facebook: https://www.facebook.com/IRMSAInsight/?ref=hl
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