1. Cloud Computing
The economics of cloud computing make adaption almost impossible to resist for many companies. A third party manages the system and holds all the data. The in-house business maintenance expenses for hardware and support staff drop to almost zero. Case closed. Or is it? Now comes a data breach, or worse yet, your vendor goes bankrupt and there's no way to get your data back. Professional liability lawsuits start flying in the door. Sure, you knew the risk of using outside contractors, but the massive liability for which your company is now on the hook has turned into an expensive and nasty surprise.
2. Population Shift
Global population migration from the countryside into the cities is creating cities of 20 million to 30 million people. Demographers predict that soon for the first time more people will be living in cities than in the countryside. The outcomes are uncertain. But already there are signs that this shift is putting a big strain on public services: schools, utilities and transportation. At the same time, natural resources, particularly water, are being depleted. And business and industry around the world is pushing the envelope to produce more and more for all these consumers, which is endangering the environment.
3. Childhood Obesity
The obesity epidemic among children is a vexing emerging risk, among the most dangerous. It is doubly worrisome because the risk is well known: large increases in Type II diabetes, more associated health problems, higher employer healthcare costs, higher insurance premiums and shorter life expectancy. It is an emerging risk for which there is no excuse. But childhood obesity is increasing and could be a game changer affecting public health and employer medical premiums now and for a long time.
4. Extracting Alternative
Fuels We need clean-burning fuels and we need them now. In other words, we need natural gas. But getting the stuff out of the ground is going to require water and chemicals being stored in ponds before they are released back into the watershed. Before long, the tainted water seeps into the water supply and now we're talking about cancer clusters among people living downstream. This isn't an outcome anybody saw coming. How did we go from gas to cancer? And who's to blame? The oil and gas companies? State licensing regulators? Private residents who lease their land to gas drillers? Consumers and industry that use fossil fuels? Unintended outcomes from the search for alternative fuels is a game changer. The first U.S. oil well was drilled in the mid-1800s. Who knew it would one day lead to Deepwater Horizon, global conflict and climate change?
5. Primary Doctor Shortage
A critical emerging risk in the U.S. is the acute shortage of primary care doctors. In medicine, the big money is in the specialties, but the research shows the primary care doctors deliver the preventative treatment. They are the doctors who make house calls and have tracked the same families for two or three generations. The potential unintended consequence is clear: Fewer family doctors to give people even the most basic care leads to higher medical costs for all and worse patient outcomes, because by the time ill patients reach a specialist it often takes longer to cure them. The outcome of having fewer primary doctors could be dire and reconfirms the maxim that "An ounce of prevention is worth a pound of cure."
The ability of viruses to mutate quickly and resist antibiotics is an emerging risk, with which the medical community is grappling as we move deeper into the 21st century. It was only the 20th century when antibiotics arrived and saved millions of lives. We've now come to see the limitation of older antibiotics and it's not clear how much longer we can rely on them to protect us without newer and stronger medicines. Without sophisticated prevention and containment plans for aggressive super viruses, nasty bugs such as influenza could cause regional, national and global epidemics that would have the cascading effect of many unanticipated events on the public and private sector.
7. Retirement Redefined
The risk is known: More than 20 years ago, companies began to ditch defined benefits pension plans in favor of defined contribution plans with the advent of 401(k) accounts. It was cheaper for employers and employees had more choices. The unintended consequence is that some employees are not good at managing their retirement funds. Many are too conservative, others too aggressive. Furthermore, many lost money or spent it to get by during the Great Recession. Now millions of Americans are retiring with meager funds and can't stop working. That dilemma combined with longer life expectancies poses a significant emerging risk: How does the workforce accommodate these older workers and who pays for their healthcare in retirement?
8. Ill-timed Rule Changes
It seems to happen every time. The stock markets get frothy as businesses prosper, build to a crescendo and then come crashing down as the economy overheats. Then comes the call for regulatory intervention and the new lawmakers in Washington and Brussels pass a blizzard of bills. In the United States, we have the Dodd-Frank Financial Reform Act. In Europe, we have Solvency II. Who pays? Corporations in America and globally and taxpayers. Dodd-Frank, by one estimate, will cost $2.9 billion. Solvency II will cost Lloyd's more than $500 million. Insurers have warned that the new regulations will eventually mean higher premiums. The intent is orderly capitalism, while the unintended consequences are confusing, costly and sometimes unenforceable regulations.
9. When Pesticide Becomes the Pest
Spraying pesticides and other chemicals on crops increases the yield on the farm as fewer crops fall to disease. But is it worth the risk? Powerful agribusiness interests are convinced of the value of pesticides. We've helped feed the world by making farmland more efficient. But the chemical runoff from farms can have disastrous consequences for watersheds. The potential unanticipated outcomes are the chemicals have seeped into the groundwater and sometimes into the public drinking water. These outcomes pose new risks for public health and the environment.
10. Distracted Equipment Operation
You can gab on the cellphone in traffic but when truckers are texting while hauling heavy cargo, and forklift operators have YouTube streaming through their hand-helds, it's a different and dangerous risk. The unintended consequences of these mobile communications devices can be deadly when distracted operators have accidents. Train, crane, and farm and heavy industrial equipment operators are particularly at risk of unanticipated events from using iPhones, two-radios and other devices while working.
May 1, 2011
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