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Businesses embracing digital acceleration face new risks

Published 10 August 2021

In order to survive challenging conditions many small to medium sized businesses have pivoted their delivery of products and services to greater dependence on digital technologies, but this also brings new risks to manage. Our insurance partner Chubb, with Accenture, has combined the results of two Consumer Pulse Surveys, one from data collected pre-pandemic and one afterwards, to identify key trends and their implications.

From depending on cloud data storage and the internet of things (IoT), using artificial intelligence in their business processes, enabling a remote workforce with company level connectivity to partnering more with e-commerce and digital companies, the shift has brought new challenges for businesses adopting more technology. 

Even before the pandemic, according to the survey of 1350 small to medium sized businesses around the world, results showed that those seeking growth were pursuing developing new products and expanding into new markets. The later survey confirmed that both consumer and employee expectations have changed since the onset of the pandemic. Comparing pre and post pandemic small to medium sized businesses survey findings confirmed that both consumer and employee expectations have changed since the onset of the pandemic.



4 key technology trends have emerged for businesses following experiences of the COVID-19 pandemic.

1.    Navigating digital customer demands 
The need to build digital experiences that fulfil customer expectations at any time, from any location, and enabling seamless delivery of products and services, tailored to customers’ wants and needs.

2.    Harnessing the power of data
Adopting cloud and other advanced technology, such as AI, to refine customer products and services and optimise business operations. 

3.    Supporting a transformed workforce
Addressing the accelerated shift to an increasingly digital workplace with flexible work solutions, career and skill development opportunities, and innovative benefits.

4.    Playing in the global market
Building opportunities for forming partnerships with other (offshore) companies to create new products or services and access commercial and social platforms to expand reach and capability.

Customer experience is critical to business success

Experience is now recognised as a top driver of how businesses build customer relationships. 
•    45% of respondents rated seamless delivery of products or services in their top 2 priorities. 
Source: Digital Business Accelerated - Chubb

To match consumer expectations based on their use of sites such as those of Amazon, Google and Alibaba businesses must adopt technologies that deliver a seamless customer experience, whatever their industry or company size. The challenge for small to medium sized businesses is to meet those standards by adapting quickly.

Customer data security guarantees are a must 

Businesses utilising customer information to guide services and strategic direction must come with assurance that their personal data is protected. 
•    32% of business owners and executives believe that offering customers greater benefits, such as more customised experiences in return for sharing personal data, is one of their greatest communications challenges. 
Source: Digital Business Accelerated - Chubb

Being able to provide assurance that sensitive details are safeguarded by recognised risk management precautions in accordance with the Privacy Act is essential. Achieving this isn’t simple. 

Business priorities for smarter technology adoption 

Business survey respondents cited adopting cloud technology and using big data as a priority for accessing consumer data insights but also aimed to use AI as their most important long-term goal. Practical uses of AI range across industries, covering everything from chatbot interfaces to route scheduling, to autonomous vehicles — but all of these applications begin with cloud technology and data. 

Only a fifth of businesses have in-house capabilities to achieve this, making these major technological hurdles. These technologies also present new business risk exposures to be managed in order to protect businesses and customer information. 

For businesses reliant on suppliers of any kind, including technology security services, these relationships need careful vetting and scrutiny around the rigour of their risk management protocols. Breach or breakdown of a third-party site or function can cause critical impacts to a business. It’s crucial for all businesses to understand your third-party risk exposures. 

Following on from this need for specialised expertise 84% of businesses recognise that to grow into new markets would require upskilling their workforce. 

To fill the gap businesses are turning to flexible work solutions and the gig economy to contract in talent and services. Providing flexible work solutions is one of their greatest challenges and their second-highest current workforce priority, but this employment model also introduces new types of risks, both in terms of cyber exposure and workplace conditions. 

Accessing new markets through established platforms and players

Smaller businesses need products, services, partners and collaborators to grow, help them enter new markets, deploy their data, and get access to scale-building technology. One solution is to partner with existing commercial social platform players. A recent Accenture study showed that more than 97% of major companies believe that future business models will be created within host ecosystems. 

•    41% are prioritising offering products or services internationally; larger platforms can provide opportunities for expansion.

•    44% of respondents say their biggest challenge is collaboration with large commercial and social platform players.

•    39% say their biggest challenge is collaboration with other organisations around data, technology products, or services.

Get whole of enterprise risk management advice

For a complete understanding of the risk exposures involved in expanding your business and accessing technology advantages through outsourcing and entering into partnerships, talk to one of our risk management specialists. We can provide a comprehensive risk analysis and advise on the protocols and protections you may need to position your business for future growth.

Further reading


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Gallagher provides insurance, risk management and benefits consulting services for clients in response to both known and unknown risk exposures. When providing analysis and recommendations regarding potential insurance coverage, potential claims and/or operational strategy in response to national emergencies (including health crises), we do so from an insurance and/or risk management perspective.
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