In an increasingly volatile business environment, the organisations that succeed are those that are resilient - but what is organisational resilience and is there a way to build your company's adaptive capacity?
Welcome to the 'age of turbulence', where change and unpredictability constitute the new normal. It's where fast-paced innovation and market shifts can upset successful business models seemingly overnight.
It's also where computerised systems increasingly put company and customer information at risk, and where cascading failures across infrastructures can bring down complex systems in an instance.
This is a world where your organisation needs core resilience capabilities to survive - but what is it that creates resilience in an organisation? Does it happen by chance, or can resilience be developed with intention?
Within the research community, excitement is building. We are unlocking the mysteries of what enables some organisations to thrive in the face of adversity, whilst others wilt and fail.
So often when thinking about resilience, we think of the moment of crisis, but resilience comes from deeper within an organisation’s culture.
It depends on the style of an organisation's leadership and culture, the networks and relationships that can be drawn on during times of adversity, and how it strategically positions itself to be ready for change.
Indicators of resilience
Over the past decade, a team of 35 New Zealand researchers have been seeking to understand what creates resilience in an organisation.
We have identified a suite of 13 leading indicators that can help reveal how resilient an organisation is likely to be in the face of future crises.
- Leadership: strong crisis leadership to provide good management and decision making during times of crisis, as well as continuous evaluation of strategies and work programmes against organisational goals.
- Staff engagement: the engagement and involvement of staff who understand the link between their own work, the organisation's resilience, and its long term success. Staff are empowered and use their skills to solve problems.
- Situation awareness: staff are encouraged to be vigilant about the organisation, its performance and potential problems. Staff are rewarded for sharing good and bad news about the organisation including early warning signals and these are quickly reported to organisational leaders.
- Decision making: staff have the appropriate authority to make decisions related to their work and authority is clearly delegated to enable a crisis response. Highly skilled staff are involved, or are able to make, decisions where their specific knowledge adds significant value, or where their involvement will aid implementation.
- Innovation and creativity: staff are encouraged and rewarded for using their knowledge in novel ways to solve new and existing problems, and for utilising innovative and creative approaches to developing solutions.
- Effective partnerships: an understanding of the relationships and resources the organisation might need to access from other organisations during a crisis, and planning and management to ensure this access.
- Leveraging knowledge: critical information is stored in a number of formats and locations and staff have access to expert opinions when needed. Roles are shared and staff are trained so that someone will always be able to fill key roles.
- Breaking silos: minimisation of divisive social, cultural and behavioural barriers, which are most often manifested as communication barriers creating disjointed, disconnected and detrimental ways of working.
- Internal resources: the management and mobilisation of the organisation's resources to ensure its ability to operate during business as usual, as well as being able to provide the extra capacity required during a crisis.
- Unity of purpose: an organisation-wide awareness of what the organisation's priorities would be following a crisis, clearly defined at the organisation level, as well as an understanding of the organisation's minimum operating requirements.
- Proactive posture: a strategic and behavioural readiness to respond to early warning signals of change in the organisation's internal and external environment before they escalate into crisis.
- Planning strategies: the development and evaluation of plans and strategies to manage vulnerabilities in relation to the business environment and its stakeholders.
- Stress testing plans: The participation of staff in simulations or scenarios designed to practice response arrangements and validate plans.
Resilience integrates the concepts of risk, crisis management, business continuity planning and organisational leadership and learning to provide a platform for developing more robust and agile organisations.
Resilient organisations are able to detect, respond and adapt to both slow and rapid onset forms of adversity.
In order to improve resilience, we need to know how an organisation’s resilience is currently tracking and where gains could be made.
Why monitor resilience?
Monitoring an organisation’s resilience over time is important. As an organisation goes through normal changes its level of resilience will fluctuate.
It is important to identify these changes, putting in place strategies to maintain to and grow resilience over time. Researchers have developed tools for measuring and monitoring levels of resilience over time.
There is still a way to go to build a complete picture of what drives an organisation’s resilience, but the good news for organisations is that we already know that any organisation can become more resilient if it wants to.
With the pace and intensity of change unlikely to slow down, it’s more important than ever to build organisational resilience skills to effectively navigate the future.
Interested in this topic? Read How resilience underpins employee wellbeing.