Polycrisis and permacrisis: Trends in crisis management

Viktor Panchak, CPP and Julian Moro take a detailed look at polycrisis and permacrisis as a growing trend in crisis management.

It is an accepted fact that today’s world is a complex and volatile landscape full of evolving challenges and non-predicted uncertainties.

In this unpredictable business environment, effective crisis management has become more important than ever before.

Crisis management serves as a crucial and fundamental part for maintaining robust business continuity and achieving organisational resilience for any modern day enterprise.

When applied well, crisis management acts as the foundation of corporate risk treatment protocols and associated duty of care initiatives.

It ensures that an organisation is prepared, can identify and respond to an emerging crisis, has the right people/resources in place (both ahead of time, as well as authority to rapidly add) as well as uses reliable information to ensure timely decision-making.

Today’s threats have transformed the strategic crisis outlook, with its increased range and interconnectivity.

The terms ‘permacrisis’ and ‘polycrisis’ have emerged to capture the essence of the evolved operating environment which organisations must navigate, to thrive.

Whether due to external factors, such as the frequency and severity of climate-related disasters, cyber-attacks, insider threats, pandemics, epidemics, supply chain impacts, sanctions and conflicts, the barrage is impacting organisations’ ability to manage business-as-usual operations, directly and indirectly.

According to International SOS’ Risk Outlook Report 2024, the Global Permacrisis is set to continue to take its toll in 2024, as extreme weather events continue to impact organisations and global instability deepens.

According to the National Oceanic and Atmospheric Administration (NOAA), in 2023 there were 28 storms, wildfires or other climate related disasters in the US that each cost at least $1b, up from the previous record of 22.

In recent years, as the disruptions caused by the pandemic began to subside, the emergence of large scale regional conflicts has unleashed new waves of supply chain and service disruptions across various industries.

With these ongoing stressors accumulating without respite, the risk of employee burnout is becoming increasingly tangible.

This extends to managers and employees charged with managing polycrisis and permacrisis as globalisation raises their organisation’s exposure and the frequency, severity and longevity of crises.

Navigating numerous complexities requires robust crisis management strategies for organisations across all industries and related business verticals.

So, what should effective crisis management look like, especially in the context of evolving permacrisis and polycrisis? In this article, we will explore the top trends and best security industry practices to shape this pivotal field.

Top five trends

Cybersecurity: Growing risks of global cyber-attacks – cyber-crime has all essential attributes to become one of the biggest challenges for enterprises in 2024/2025, specifically in the framework of developments in the digital world. Convergence in security might become an instrumental tool to tolerate the crisis impact as a part of a company’s Enterprise Security Risk Management approach.

• According to Cybersecurity Ventures’ Cybercrime Report, by 2025, cyber-crime is projected to cost the global economy $10.5t dollars in damages, which itself makes a polycrisis with a worldwide reach.

Technological boost: AI and machine learning (ML) on pace – while both AI and ML offer wide capabilities in boosting sales, predictive analytics, real time monitoring and multifunctional automated response mechanisms, however this does not necessarily consider the Code of Ethics – thus creating valuable grounds for manipulations and potential misconduct. If implemented irresponsibly and beyond the vague regulatory norms, it has the probability to generate additional triggers that may lead to devastating crisis management failures.

• According to Goldman Sachs’ review, by 2025, artificial intelligence investment is forecast to approach $200b dollars globally.

Climate change and geopolitical shifts: Tectonic turn to multiply a crisis – climate change is reasonably the key driver in reshaping the global geopolitical and financial system as a whole. The impact of climate change and geopolitical shifts must be considered at multiple levels, beyond the immediate impacts of extreme weather events and global political changes. These factors multiplied by socio-economic challenges and increasing polarisation will bring an increased risk of disruption, supply chain issues and natural disasters, thus turning them into a polycrisis.

• According to the World Economic Forum’s study, the global cost of climate change damage is estimated between $1.7t and $3.1t per year by 2050, with $16m per hour.

Business and economic landscape transformation: New normal permacrisis – as geopolitics remains focused on maintaining unsustainable economic systems through incremental changes rather than promptly transforming them, enterprises are becoming increasingly vulnerable to polycrisis or permacrisis. In that way, business undergoes a continuous transition, re-organising itself to a point of stabilisation at a lower level of complexity to ensure higher levels of workforce protection and anti-crisis wellbeing within its corporate boundaries.

• According to EY research, the best strategy for business leaders to thrive in 2024 and mitigate a transformational permacrisis is to reimagine enterprise, accelerate investments into innovation, embrace agility and enhance profitability.

Crisis communication systems: Amplification of misinformation and disinformation – understanding the credibility of verified information and managing seamless communication during a crisis is vital, especially in the context of technological advancements. Therefore, the rise in crisis communication systems requires tools that would include wireless, satellite and 5G connectivity. Thus, renovated systems need to be instrumental, multifunctional and address concerns head-on.

• According to the economic study by the University of Baltimore, the estimated cost of misinformation and disinformation is $78b dollars each year.

Best practices to manage permacrisis and polycrisis

Managing any permacrisis and polycrisis begins with proper preparation. To remain efficient and productive, businesses must navigate a very complex network of risks.

The main idea here is to make sure enterprises are ready to “plan for unplannable” and run simulation exercises to test their response plans. So, how can business be best prepared for permacrisis and polycrisis?

Enable forward-thinking and proactive crisis management planning: It is essential to immediately review (preferably with third party professional service consultancy companies that provide “second opinion”) and update crisis management plans based on potential risks and emerging trends.

Remember, that one “universal” plan will not fit all situations, so do not underestimate any known and unknown threats to be properly reflected in your response protocols.

Consider permacrisis and polycrisis as an opportunity, not a hardship: The takeaways learned from a crisis shape the basis for future success and value proposition.

To frame a strategic roadmap in permacrisis, the business is recommended to duly analyse the new environment, thoroughly evaluate risks, adjust short and long term strategic goals, update the strengths and weakness profile, renew strategic planning and establish a dynamic process for continuous education.

Acknowledge wellbeing and mental health: A polycrisis transforms employee wellbeing and mental health through indicators such as distressed events, illness and more.

Medical and safety professionals should make suggestions to set a global anti-crisis foundation promoting mental health and wellbeing in the workplace, to help employees improve the business relationship and handle negativity during turbulent times.

This is a great idea to communicate across business lines.

Recognise engagement and empathy in decision-making: The way a company manages polycrisis or permacrisis can determine its immediate response maturity.

While counting on diverse perspectives of key stakeholders, always try to consider engagements from employees, customers and other associated communities impacted by the crisis, thus fostering a culture of empathy and inclusiveness as a part of your diverse but critical response protocols.

Promote a strong crisis management culture across all business verticals: The focus should be on empowerment and led-by-example leadership that embraces succession planning.

This requires strong stakeholder buy-in. Successful crisis management skills are well-developed through recurring exposure to the pressures and demands faced when severe disruptions occur.

Building mature resilience in a permacrisis and polycrisis world is a complicated and multifunctional task. Start with what matters most to your business and connect the dots, identifying gaps and blind spots.

Present and future risks will continue interacting with each other to form new trends in crisis management strategies.