Thought Leadership
Up & Out: From Insight to Authority (Part I)
In this iteration, we reveal the strategic opportunity for intelligence teams as executive committee (ExCo) perceptions of geopolitical risk increase and how intelligence managers can manoeuvre towards earning authority and institutionalising their teams’ roles.
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The Time is Right – A Strategic Opportunity
Empirical evidence illustrates growing ExCo focus on geopolitical risk and the widening range of downstream business impacts that flow from it. PwC’s latest CEO survey is one such data point, showing concern about geopolitics as a driver of macroeconomic volatility, inflation, cyber risks, conflict, tech disruption, climate change, and social inequality. Research from The Conference Board also shows that CEOs are most worried about intensifying trade wars and associated macroeconomic risks due to geopolitical tensions between the US, China, and Europe.
And it’s not just CEOs. In the financial sector, for instance, the latest iteration of a long-running CRO survey by the Institute of International Finance and EY shows substantial rises in risk team focus on geopolitical issues. We also see plenty of anecdotal indications amongst the firms we support, with intelligence teams encountering growing ExCo and board interest in their work.
A key driver of this heightened focus on geopolitical risk is the Trump administration’s emphasis on tariffs, including those applied to close allies and trading partners. Many corporate management teams are now exploring options to minimize the financial impacts to their supply chains, which includes mitigations for investments, intellectual property, and manufacturing operations.
Essentials for ExCo Influence
Every business will govern geopolitical risk differently from its industry peers thanks to risk appetites largely informed by the board’s strategic objectives. As a result of the diverse nature of geopolitical risk management, integrating intelligence analysis into your organization’s operations will require bespoke solutions.
There are two areas where intelligence teams can expend more focus to position themselves effectively with their ExCo teams and deliver tailored intelligence to support geopolitical risk. The first is understanding your firm’s operating model to assess impacts coherently, complemented by strengthening your organizational awareness to understand the risk appetite of different business functions.
Mastery of Corporate Impacts is critical and best approached by understanding the wider business model of your organization. This entails researching growth strategy, key supply and demand-side market dependencies, different product/business lines, and footprint in the industry sectors in which your firm operates.
- This sounds daunting, but reading annual reports, the financial press, and investor analysis (if you operate in a listed firm) can help. Spending time to understand economic concepts and exploring market forces is also useful, as well as seeking opportunities to spend time with business teams and other control functions.
- When analysing how upstream risks may generate downstream impacts, you can use the FORBES model, looking at impacts to Financial performance, Operational Resilience, the Business model, Equities (including stakeholders and reputation), and overall Strategy.
- These impacts can also be indirect, intersect with other macro risks, and depend much more on your organisation’s market dependencies (e.g., commodity price stability on the supply side or GDP growth in key markets on the demand side) than on geographic footprint.
Organisational Awareness: Geopolitics generates differing impacts for different firms, even those operating in the same industry sector. But there are common themes, and building your understanding of how other functions track external developments will enable you to proactively identify areas you can support. We frequently find that these include:
- Compliance, regulatory affairs, and legal teams. They monitor laws and regulations, with changes increasingly driven by geopolitical factors.
- Finance and treasury functions. They deal with changing macroeconomic conditions and may have forward-looking planning processes that a geopolitical risk analyst can support.
- CROs and risk functions. Enterprise risk management (ERM) teams often maintain a risk register and/or identify, monitor, and mitigate recognised ‘principal risks’. This may explicitly include geopolitics or, if not, will certainly itemise risks exacerbated by geopolitical issues. Risk lists and risk management approaches are also typically addressed in corporate reporting and market statements, offering a potential hook for intelligence teams.
- Strategy, marketing and sales teams, who may be concerned with how global affairs influence consumer behaviour.
- Procurement and supply chain. Geopolitical events directly impact these functions, affecting the availability, cost, and reliability of materials and products.
- Human resources. As upended global norms restrict the ability of people to live, work, and operate across borders, those responsible for talent acquisition, employee support, and global mobility can expect stronger headwinds.
Levels of engagement with internal partners can be tiered based on their geopolitical expertise or the strategic importance of that function. It’s also worth noting that engagement with other over-arching functions can help, such as the governance/company secretary team supporting the board and masterminding market statements (e.g., annual reports), or the internal audit function, which may also have an overview of the organisation’s approach.
Reconceptualising “Intelligence Requirements”
While the term “intelligence requirements” (IRs) is well known among practitioners in our field, it fails to resonate among many corporate consumers, particularly outside of security teams. Instead, analysts should drive engagement by framing insights around business priorities and decision-making needs.
Rather than asking, “What are your intelligence requirements?”, consider questions such as:
- “What factors could disrupt your growth strategy in the next 12 months?”
- “Which market dependencies are most critical to your team’s success?”, or
- “What emerging risks could impact key business objectives?”
These are only a few of many questions that intelligence teams should be helping to answer. But to do so effectively, they need to understand business leaders’ decisions. We’ll share more thoughts on this in future articles.
Conclusion
The Up & Out way of thinking is not always easy for analysts operating in a ‘security first’ environment. Building an intelligence team’s interface with an organisation’s wider range of teams is generally a process, not an event. It also requires active effort to understand the work and speak the language of others in the business. But the rewards of doing so can be significant.
Sibylline provides tools, techniques, and methodologies to support analysts, intelligence managers, and CSOs in understanding their organizations beyond the realm of security, and we are always happy to share more guidance with those who wish to explore this area in more detail.
Next time, we’ll discuss how external stakeholder perceptions can feed into your approach, ideas on organisational models, and specific techniques to generate ExCo or board sponsorship for your activity.