The high-wire act that businesses in Asia must perform in their dealings with both China and the US will become even more precarious in 2025 as the strain of trade restrictions, sanctions and tariffs (now salted with the addition of Chinese countermeasures) grows in size and scope. To win in this environment and seize the opportunities it will throw up, businesses will need to bring the concept of resilience to the forefront of their thinking. The scale and pace of how businesses do this will vary, but a sense of urgency is advisable.
Early warning systems: a key component of resilience
With so much risk and noise swirling around, executives risk being blinded by the possible impacts of mega-events and blind to the more workaday localised issues that continue to trouble operations in much of Asia. For example, there is no point in modelling sabotage threats to underwater data cables if it takes focus from monitoring the potential for your facility to be overrun by a bogus extortive NGO or rendered useless by a rogue provincial policy on power consumption.
Precisely because both the uncertainty and the consequences of geopolitics are growing dramatically, companies operating in Asia must devote significant time and resources to developing early warning programmes. Many of the most resilient companies we work with in Asia are adopting some or all of the following as part of those programmes:
- Online threat and intelligence monitoring: Monitoring that covers threats to your brand, your people or your physical assets – with a focus on identifying and assessing issues before they manifest in the real world.
- In-house political risk teams and corporate ‘national security councils’: In-house teams that can triangulate what is happening externally and how it might impact your business.
- Scenario planning: Thinking through the likelihood and impacts of different scenarios to help you focus on the areas likely to matter most to your business.
- Crisis exercising: A variety of crisis exercises to help increase your early warning capabilities by preparing you for the predictable and what today might seem unimaginable but tomorrow could be reality.
These elements alone are not sufficient to ensure organizational resilience. For early warning systems to work, they must feed into a comprehensive set of strategies around crisis management, business continuity, supply chain resilience, cyber security and more.
The pandemic gives us some stark lessons. The firms that succeeded were not the ones with the most elegant pandemic scenarios; they were the ones prepared with training and resources when one of those scenarios manifested. The most resilient firms had planned and rehearsed a production ramp-up in one factory because another had been forcibly closed. The losers belatedly realised they needed that plan but could do little about it once supply chains fractured.
Uncertainty to-do list
The list of things you need to do to make your business resilient is exhaustive but simple: harden your systems, secure your people and assets, build redundancy in your supply chains, ensure compliance, practice dealing with crises, and keep your boss away from saying things on X! It can be daunting to consider and tedious to execute. However, if your organisation takes these steps now, dealing with uncertainty throughout the remainder of 2025 will be much more manageable.
Learn more about how we are helping businesses enhance resilience.