In the wake of the international financial crisis that began in 2008, there has been a keen interest on the part of American-based organizations, large and small, in identifying and assessing key risks facing them and finding effective ways to navigate those risks. The stakes have rarely been higher.
At the height of the crisis there was serious concern that the world's economy would sink from recession into a serious depression. The accompanying uncertainty led organizations and individuals to stockpile cash, defer capital spending and shun many commitments.
Of course, each organization's array of important risks is unique to that organization. Microsoft Corp.'s set of key risks is certainly different from those of Comcast Corp. But it is an interesting pursuit to examine the top risks facing U.S. businesses--be they public or private; major or minor; volatile or stable.
This examination could lead to some revealing observations as the common risks bubble up. These risks could direct policymakers toward plans and actions that would benefit United States organizations as a whole.
The present is an ideal opportunity to identify these risks. Organizations have just begun emerging from some of the most trying times executives have faced in at least a generation. In addition, many organizations have been installing a comprehensive system to identify and manage risks--generally known as enterprise risk management, or ERM. Executives have risk "on their minds" these days and they are not shy about sharing their risk views. Those not shaken by the crisis were certainly stirred as they peered over the proverbial brink of disaster.
U.S. Business Risks
The authors assembled a panel of executives to query about important risks facing U.S. businesses today, and a discussion of the findings of top risks follows.
WORKFORCE COMPETITIVENESS (EDUCATION). Several participants shared concerns over competitiveness and pointed negatively at the educational system in the U.S. The risk is partially a concern that we are "not educating people for the right jobs." One participant noted that we educate the top tier quite well, but are failing the rest.
In comparing the number of outstanding students that the U.S. is producing to the number of outstanding students other countries are producing, he suggested this is bad news for the U.S. if the trend continues.
Similarly, a few high-technology executives expressed their concern over finding enough highly-qualified job candidates. In "The World 2013," published by The Economist, a similar point was made by Harvard Business School Professors Michael Porter and Jan Rivkin, who stated: "America faces pressing skill shortages in knowledge work." A solution some have suggested is to staple a green card to every diploma earned in the U.S. by an international student with a STEM degree (science, technology, engineering and math).
As it is now, companies tend to offshore low-level positions and...