2011 was a far quieter year on the Korean Peninsula than many analysts, myself included, predicted. A year ago, South Korea had suffered its second brutal attack from the North, adding four more casualties on Yeonpyeong Island to the 46 that had perished on the Cheonan. Tensions were high and the two Koreas appeared on the brink of escalating hostilities. North Korea vowed war if South Korea carried out plans for military exercises in December.

Pyongyang had clearly demonstrated its willingness to engage in high-risk, deadly actions while Seoul pledged that next time it would retaliate. Similar South Korean vows had never been carried out, but this time Seoul had altered its rules of engagement, augmented sensors and military forces, and received tacit approval from Washington for an asymmetric retaliatory response.

Seoul faced down North Korean threats, conducted the military exercises, and the crisis fizzled. Nor did Pyongyang conduct more nuclear or missile tests or trigger another tactical military clash during the year. Diplomacy also remained stagnant throughout the year except for a few desultory bilateral meetings that failed to produce even a glimmer of optimism.

2011 ended, however, with two shocking events. The first was credible rumors that U.S. and North Korean diplomats had secretly achieved a breakthrough portending a resumption of Six-Party Talks. Pyongyang had reportedly acquiesced to three U.S. and South Korean preconditions in return for 240,000 tons of food.

If true, North Korea had abandoned its demands for unconditional return to the nuclear negotiations. Yet this was only a tactical victory since Washington had merely gained North Korean agreement to pledge again to accept its previous commitments, at the cost of hundreds of thousands of tons of food aid.

But even this minor success was eclipsed by news of Kim Jong Il's death. A flurry of articles and analyses were scribed during the following week prognosticating on Kim Jong Eun's character, likelihood of retaining the crown of power, and policy objectives. Yet, the reality is that there is even greater uncertainty now than ever when gazing northward. And it is these uncertainties that trigger concerns in the corridors of power in Washington and Seoul.

Predictions of imminent regime collapse or lashing out are overblown and unhelpful, as are vague calls for regime change bereft of detailed recommendations. But even more reasoned analysis provides plenty to be worried about.

Of immediate concern is whether this new inexperienced, untested leader can consolidate his power or whether North Korea will deteriorate into competing or even warring factions. The likelihood for a sustained regime, and therefore stability, is greater than had Kim Jong Il died in August 2008 when he suffered a massive stroke. At that time, there were no provisions in the North Korean constitution for succession or any formal succession plan. Had Kim died then, the potential for regime collapse would have been far greater.

During the ensuing three years, Pyongyang has implemented a succession strategy to elevate and unveil Kim Jong Eun. The leadership succession appears to be on track with recent reports suggesting North Korea's military has pledged its fealty to Jong Eun in return for a collective leadership. Whether such a power-sharing arrangement can be established and sustained remains to be seen.

The North Korean elite has a vested interest in maintaining the system and will assess Jong Eun’s ability to protect its interests. The elite will balance a shared sense of external threat against fear of domestic instability from an inexperienced leader. The senior government leadership may conclude Jong Eun’s shortcomings are sufficient justification for contesting his succession. Elite resistance to Jong Eun’s rule could manifest itself in outright opposition or in usurping his power and leaving him a mere figurehead.

Even if Kim Jong Eun overcomes immediate challenges to his leadership, he would then be confronted with North Korea's abysmal economic conditions, near total isolation, international sanctions, and an international community far less susceptible to Pyongyang's threats and charm offensives.

Fault lines could appear within the elite over time. Jong Eun would endeavor to maintain regime cohesion, domestic stability, and influence over foreign nations, but even an initially successful succession could deteriorate into a power struggle and leadership vacuum.

Low-probability but high-impact scenarios would be a power vacuum; civil war among warring factions; or internal unrest extensive enough that it leads Beijing or Seoul to intervene, particularly if concern over control of North Korea's nuclear weapons arises. North Korea's neighbors might fear that the instability could create an "explosion" (aggressive actions toward South Korea or Japan) or an "implosion" (regime collapse).

If the situation became so dire as to bring about the collapse of the regime, it could lead to North Korea's loss of control over its nuclear weapons, greater risk of rogue elements selling weapons of mass destruction to other rogue governments and terrorist groups, fighting among competing factions, economic turmoil, and humanitarian disaster. Under such circumstances, China or South Korea might feel compelled to send troops into North Korea to stabilize the country, raising the potential for miscalculation and armed confrontation.

The North Korean regime has shown remarkable resilience over the past 15 years, belying repeated predictions of its imminent demise. However, there is now a growing sense that a combination of stresses is pushing Pyongyang closer to the tipping point. Like storm clouds on the horizon, the implications of leadership transition are significant and unpredictable.