Building resilience is more important than long-term planning—we all know that plans inevitably are overtaken by change, now more than ever.
By Kabir Singh, Senior Manager: Advisory Services, ContinuitySA
Resilience is one of the new business buzzwords, but for very good reason. Planning, the old corporate mainstay, is becoming less reliable: things change more quickly than in the past, for one, and new risks seem to come out the left field.
In short, developing the ability to respond to, and recover from, any eventuality—resilience—makes excellent business sense.
However, resilience is hard to achieve. At the most profound level, resilient organisations are built on a culture of shared values, and display a stronger sense of team unity than usual. But there are some concrete actions that organisations can take to build resilience:
- Work on more than one time cycle. A company without a Plan B puts itself at grave risk of failure. Instead, work on more than one time cycle at a time, thus creating value for both the very short term and long term.
- Embrace cognitive diversity. The best companies display cognitive diversity; that is, people with the same values, but with different thinking styles. The ideal is for employees to aim toward the same goal but bring unique insights and ways of looking at problems.
- Actively weave accountability into the fabric of the culture. Accountability, like other elements of corporate culture, is driven from the top.
- Delegate leadership responsibility and authority down the chain of command, right to the frontline—and then provide the tools and resources for rapid execution.
- Exist in a constant state of transformation and reset goals every few years. Resilient organisations accept that plans must change, and so they set a clear time-bound vision and communicate it regularly. Information is disseminated quickly, and they involve as many people as possible in planning.
- Manage performance and risk across different horizons. Resilient organisations protect their base or core business and are quite cautious about disturbing the success formula and established processes.
- Leverage a wide array of information to make decisions. Resilient organisations have several established processes for information-gathering, but they almost always supplement these by seeking out alternative sources.
- Maintain a broad portfolio of strategic options. While all organisations have established core businesses, resilient organisations also seem to have a broad portfolio of future opportunities.
- Establish effective governance structures and processes. Organisations that have good governance structures have three things in common. They pay particular attention to board selection, training and performance—with a focus on the board’s ability to engage and challenge management. They provide good-quality information to board members timeously. And, finally, they take a realistic view of the total corporate risk the organisation faces, including non-traditional risks such as compliance, natural hazards.
- Close alignment with the operating environment. Resilient organisations recognise that different parts of the environment pose different challenges, and they know the organisation needs to respond with a specific offering or strategy in each of these segments.
- Separate resource allocation and deployment. Resilient organisations derive great benefit from separating the processes of deciding what opportunities to pursue from deciding how to undertake that pursuit operationally.
- Strong sense of purpose and values. While almost all organisations have statements of purpose and values, resilient ones link purpose to the overall client value proposition.