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From Fragile to Robust: How to build operational resilience in your business

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From Fragile to Robust: How to build operational resilience in your business

Operational resilience is an organisation’s ability to continue to deliver critical business services after facing one or more disruptive events. It also covers the ability to predict and prevent disruptive events and better control and recover from them, should they occur.

The pandemic, for example, became a real-world test for many organisations globally. With lockdowns, border closures, and working from home, businesses had to rapidly adapt to new working methods, which normally would have taken a couple of years to implement.

The newly drafted Australian Prudential Regulatory Authority (APRA) Standard CPS 230 on Operational Risk has stated that regulated organisations will need to tighten up several areas of their risk management to meet the new requirements. The focus includes preventing disruption to critical operations, adapting processes and systems to continue operations in the event of a disruption, and returning to normal operations promptly after a disruption is over. APRA does not see operational resilience as something new or separate from operational risk management. It is the outcome and an extension of business continuity management. 

Protecht recently surveyed risk professionals to determine their organisations’ operational resilience understanding and requirements, and it was clear from the results that most respondents value the idea but implementation remains limited. Nearly all surveyed (96 per cent) believe operational resilience should be an important priority for their organisation, but only under half (46 per cent) currently rates their organisation’s operational resilience capacity as “high/very high”.

So, with a high probability of major disruptive events expected in the future, operational resilience is the key to an organisation’s ability to survive and even thrive during such incidents. If there was ever a time to focus on building operational resilience within an organisation, it is now, and here is how to get started.

Identify the core components of operational resilience

An operational resilience framework will require an understanding of:

  • Your important or critical business services.
  • The sub-processes that deliver those services.
  • The resources (hardware, software, teams, infrastructure) connected to the service.

Once identified, it becomes easier to model the risk scenarios that would disrupt that service and think about any preventative controls that will mitigate the likelihood of those scenarios occurring.   Should the scenario occur, we also are in a better position by having planned, documented and tested the recovery strategy. 

Integrate it into your overall Enterprise Risk Management (ERM) systems and framework of your organisation 

Integrating operational resilience as part of your ERM systems ensures that the maximum leverage is obtained from your existing risk and control libraries and processes are not reinvented. This reduces overall costs and the effort it would take to implement the strategy. Instead of starting from scratch, the efforts can be focused on extending current capabilities.

Ensure that the key elements are in place

It is important to have a robust framework to build a sustainable and effective operational resilience Capability. Some key focus areas in this regard are:

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  • Who will govern the implementation and management of the project?
  •  Is the project adequately budgeted for both in terms of people and dollars?
  • A clear plan that doesn’t just rebrand current systems but improves and evolves them to create true enterprise-wide resilience. 
  • Provide adequate training and upskilling to the staff in operational resilience principles that align with the project plan.

Get the leadership buy-in

Since cost and effort are minimised in building operational resilience into the current systems and overall ERM framework, board, and management buy-in is easier as it is not delivered as some new major project but as an additional part of what already exists. The survey found that in over 34 per cent of organisations, operational resilience is a concept that uses much of their existing risk management capability, consolidating existing practices. With the leadership team invested, implementation of the resilience framework would be smoother thereby further reducing effort and time.

Monitor results and use them to your advantage

An important step in any new systems implementation is to analyse its performance, learn from it, modify plans, and communicate the results to all key stakeholders. Resilience can assure critical processes continue under a range of potentially disruptive events.  but must be continually monitored to help identify areas of improvement, single points of failure and redundancy. Resilience considerations can also be used in decision making, whether regarding the location of office premises or a decision to take on a new supplier.

Ultimately, operational resilience is important for any organisation – not just regulated financial institutions.

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Amazon won’t have to pay hundreds of millions in back taxes after winning EU case

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Amazon won’t have to pay hundreds of millions in back taxes after winning EU case

LONDON (AP) — Amazon won’t have to pay about 250 million euros ($273 million) in back taxes after European Union judges ruled in favor of the U.S. e-commerce giant Thursday, dealing a defeat to the 27-nation bloc in its efforts to tackle corporate tax avoidance.

The ruling by the EU’s top court is final, ending the long-running legal battle over tax arrangements between Amazon and Luxembourg’s government and marking a further setback for a crackdown by antitrust chief Margrethe Vestager.

The Court of Justice backed a 2021 decision by judges in a lower court who sided with Amazon, saying the European Commission, the EU’s executive branch, had not proved its case that Amazon received illegal state support.

“The Court of Justice confirms that the Commission has not established that the tax ruling given to Amazon by Luxembourg was a State aid that was incompatible with the internal market” of the EU, the court said in a press release.

Amazon welcomed the ruling, saying it confirms that the company “followed all applicable laws and received no special treatment.”

“We look forward to continuing to focus on delivering for our customers across Europe,” the company said in a statement.

The commission said it “will carefully study the judgment and assess its implications.”

The case dates back to 2017, when Vestager charged Amazon with unfairly profiting from special low tax conditions since 2003 in tiny Luxembourg, where its European headquarters are based. As a result, almost three-quarters of Amazon’s profits in the EU were not taxed, she said.

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The EU has taken aim at deals between individual countries and companies used to lure foreign multinationals in search of a place to establish their EU headquarters. The practice led to EU states competing with each other and multinationals playing them off one another.

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Tesla autopilot recalls: 2 million vehicles need to have their defective systems fixed

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Tesla autopilot recalls: 2 million vehicles need to have their defective systems fixed

DETROIT (AP) — Tesla is recalling nearly all vehicles sold in the U.S., more than 2 million, to update software and fix a defective system that’s supposed to ensure drivers are paying attention when using Autopilot.

Documents posted Wednesday by U.S. safety regulators say the update will increase warnings and alerts to drivers and even limit the areas where basic versions of Autopilot can operate.

The recall comes after a two-year investigation by the National Highway Traffic Safety Administration into a series of crashes that happened while the Autopilot partially automated driving system was in use. Some were deadly.

The agency says its investigation found Autopilot’s method of making sure that drivers are paying attention can be inadequate and can lead to “foreseeable misuse of the system.”

The added controls and alerts will “further encourage the driver to adhere to their continuous driving responsibility,” the documents said.

But safety experts said that, while the recall is a good step, it still makes the driver responsible and doesn’t fix the underlying problem that Tesla’s automated systems have with spotting and stopping for obstacles in their path.

The recall covers models Y, S, 3 and X produced between Oct. 5, 2012, and Dec. 7 of this year. The update was to be sent to certain affected vehicles on Tuesday, with the rest getting it later.

Shares of Tesla slid more than 3% in earlier trading Wednesday but recovered amid a broad stock market rally to end the day up 1%.

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The attempt to address the flaws in Autopilot seemed like a case of too little, too late to Dillon Angulo, who was seriously injured in 2019 crash involving a Tesla that was using the technology along a rural stretch of Florida highway where the software isn’t supposed to be deployed.

“This technology is not safe, we have to get it off the road,” said Angulo, who is suing Tesla as he recovers from injuries that included brain trauma and broken bones. “The government has to do something about it. We can’t be experimenting like this.”

Autopilot includes features called Autosteer and Traffic Aware Cruise Control, with Autosteer intended for use on limited access freeways when it’s not operating with a more sophisticated feature called Autosteer on City Streets.

The software update will limit where Autosteer can be used. “If the driver attempts to engage Autosteer when conditions are not met for engagement, the feature will alert the driver it is unavailable through visual and audible alerts, and Autosteer will not engage,” the recall documents said.

Depending on a Tesla’s hardware, the added controls include “increasing prominence” of visual alerts, simplifying how Autosteer is turned on and off, and additional checks on whether Autosteer is being used outside of controlled access roads and when approaching traffic control devices. A driver could be suspended from using Autosteer if they repeatedly fail “to demonstrate continuous and sustained driving responsibility,” the documents say.

According to recall documents, agency investigators met with Tesla starting in October to explain “tentative conclusions” about the fixing the monitoring system. Tesla did not concur with NHTSA’s analysis but agreed to the recall on Dec. 5 in an effort to resolve the investigation.

Auto safety advocates for years have been calling for stronger regulation of the driver monitoring system, which mainly detects whether a driver’s hands are on the steering wheel. They have called for cameras to make sure a driver is paying attention, which are used by other automakers with similar systems.

Philip Koopman, a professor of electrical and computer engineering at Carnegie Mellon University who studies autonomous vehicle safety, called the software update a compromise that doesn’t address a lack of night vision cameras to watch drivers’ eyes, as well as Teslas failing to spot and stop for obstacles.

“The compromise is disappointing because it does not fix the problem that the older cars do not have adequate hardware for driver monitoring,” Koopman said.

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Koopman and Michael Brooks, executive director of the nonprofit Center for Auto Safety, contend that crashing into emergency vehicles is a safety defect that isn’t addressed. “It’s not digging at the root of what the investigation is looking at,” Brooks said. “It’s not answering the question of why are Teslas on Autopilot not detecting and responding to emergency activity?”

Koopman said NHTSA apparently decided that the software change was the most it could get from the company, “and the benefits of doing this now outweigh the costs of spending another year wrangling with Tesla.”

In its statement Wednesday, NHTSA said the investigation remains open “as we monitor the efficacy of Tesla’s remedies and continue to work with the automaker to ensure the highest level of safety.”

Autopilot can steer, accelerate and brake automatically in its lane, but is a driver-assist system and cannot drive itself, despite its name. Independent tests have found that the monitoring system is easy to fool, so much that drivers have been caught while driving drunk or even sitting in the back seat.

In its defect report filed with the safety agency, Tesla said Autopilot’s controls “may not be sufficient to prevent driver misuse.”

A message was left early Wednesday seeking further comment from the Austin, Texas, company.

Tesla says on its website that Autopilot and a more sophisticated Full Self Driving system are meant to help drivers who have to be ready to intervene at all times. Full Self Driving is being tested by Tesla owners on public roads.

In a statement posted Monday on X, formerly Twitter, Tesla said safety is stronger when Autopilot is engaged.

NHTSA has dispatched investigators to 35 Tesla crashes since 2016 in which the agency suspects the vehicles were running on an automated system. At least 17 people have been killed.

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The investigations are part of a larger probe by the NHTSA into multiple instances of Teslas using Autopilot crashing into emergency vehicles. NHTSA has become more aggressive in pursuing safety problems with Teslas, including a recall of Full Self Driving software.

In May, Transportation Secretary Pete Buttigieg, whose department includes NHTSA, said Tesla shouldn’t be calling the system Autopilot because it can’t drive itself.

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AP Technology Writer Michael Liedtke contributed to this story.

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Why Was Sam Altman Fired? Possible Ties to China D2 (Double Dragon) Data from Hackers

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Theories are going around the internet why Sam Altman was fired. On an insider tech forum (Blind) – one person claims to know by third-hand account and how this news will trickle into the media over the next couple of weeks.

It’s said OpenAI had been using data from D2 to train its AI models, which includes GPT-4. This data was obtained through a hidden business contract with a D2 shell company called Whitefly, which was based in Singapore. This D2 group has the largest and biggest crawling/indexing/scanning capacity in the world 10x more than Alphabet Inc (Google), hence the deal so Open AI could get their hands on vast quantities of data for training after exhausting their other options.

The Chinese government became aware of this arrangement and raised concerns with the Biden administration. As a result, the NSA launched an investigation, which confirmed that OpenAI had been using data from D2. Satya Nadella, the CEO of Microsoft, which is a major investor in OpenAI, was informed of the findings and ordered Altman’s removal.

There was also suggestion that Altman refused to disclose this information to the OpenAI board. This lack of candor ultimately led to his dismissal and is what the board publicly alluded to when they said “not consistently candid in his communications with the board.”

To summarize what happened with Sam Altman’s firing:

1. Sam Altman was removed from OpenAI due to his ties to a Chinese cyber army group.

2.OpenAI had been using data from D2 to train its AI models.

3. The Chinese government raised concerns about this arrangement with the Biden administration.

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4. The NSA launched an investigation, which confirmed OpenAI’s use of D2 data.

5. Satya Nadella ordered Altman’s removal after being informed of the findings.

6. Altman refused to disclose this information to the OpenAI board.

 

We’ll see in the next couple of weeks if this story holds up or not.

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