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We’re calling the pandemic a “grey swan” because pandemics are not unknown risks. If you look at the 2019 World Economic Forum Global Risk report, the “risk of infectious disease” came in last on the top 10 list in terms of impact and didn’t make the list in terms of probability. But, it’s on the list, as the report states:
Each month the World Health Organization (WHO) tracks 7,000 new signals of potential outbreaks, generating 300 follow-ups, 30 investigations and 10 full risk assessments. In June 2018 there were — for the first time ever — outbreaks of six of the eight categories of disease in the WHO’s “priority diseases” list. If any had spread widely, it would have had the potential to kill thousands and create major global disruption.
And guess what was included in those eight categories: Middle East respiratory syndrome coronavirus (MERS-CoV) and severe acute respiratory syndrome (SARS).
And if you look at some of the nearest risk types on the risk map, you’ll find:
- Fiscal crisis
- Food crisis
- Unemployment and underemployment
- Failure of financial mechanism or institution
- Failure of national governance
- Critical information infrastructure breakdown
Do these sound familiar? The report also shows how many risks are highly interconnected, and there’s a thread that runs through most of them: supply chains. Supply chain folks’ ears perk up given how often the term “risk” is uttered these days, and unfortunately not in a good light (note the last three risks in the list above). And those supply chains are highly interconnected global flows of goods, humans and machines — and viruses that can jump along for the ride. When the information systems/silos and governing systems/silos fail, that’s when the swan kicks your butt (which is in character for a swan, actually).
When corporations and governments alike don’t learn from the past, then the pain of previous risk events fade, defenses drop, preparedness falters and supply chains lose their protections which is shown well here (courtesy of Resilinc)