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Building sustainable organisational resilience

By Professor David Denyer
To say the business world was unprepared for the coronavirus pandemic is an understatement. Some had considered it possible, were somewhat prepared, and managed to turn the threat into an opportunity, but research suggests most companies – at best – muddled through.

 



We have seen businesses reinvent themselves in ways few would have thought possible. Some have thrived as a result, but most have struggled to adapt – and many have not survived.


The pandemic has put future-proofing and business resilience at the top of the boardroom agenda, as organisations seek to learn lessons and ensure they are better prepared to face future disruption, whatever its form.

The threat landscape is more complex and volatile now than it has ever been. Slowly emerging challenges like climate change, aging populations and rising levels of obesity are ever-present, and must be considered alongside the possibility of future crises such as terrorist attacks, extreme weather events and pandemics.

COVID-19 has exposed how interdependent our society and systems have become. Increased globalisation and the rise of interactive and interrelated technology have created ideal conditions for the so-called ‘butterfly effect’, where a small change in one part of the world cascades throughout the system causing catastrophic problems down the line.

The complexity of the threat landscape means organisations cannot look to cover off threats in a siloed way. Instead of fixating on the individual threats they might face – which could be something no one has yet anticipated – they need to be unafraid to discuss what future failure looks like, and focus on how they develop the agility to cope with the unimaginable and remain within impact thresholds that are acceptable to their consumers.

Research shows businesses that prove to be resilient share four common characteristics, termed the four Rs.

Readiness involves anticipating what may lie ahead, acknowledging your business’s connections and bearing in mind the potential for the butterfly effect.

Responsiveness is a realisation that you cannot control or prepare for every threat you face. Organisations that do this well proactively plan for failure, using ‘pre-mortems’ to put themselves in the future and stress test how quickly their business can adapt.

Recovery is a plan for you how get back on track, and requires businesses to focus on outcomes, rather than assets. What options and alternatives do you have to deliver service to your customers if one of your sites cannot operate, for example?

Regeneration is about what can be done now to reinvent your organisation for potential future threats, recognising that winning at resilience is often about changing before the cost of not changing becomes too great .

Businesses may hope never again to see the likes of the disruption caused by COVID-19 but, only by developing their capabilities across these four areas, will they be prepared to face whatever their future holds.

 

Adapted from the full article in Economic Focus.

 


Author

David Denyer is a highly cited author, engaging keynote speaker, and an inspiring educator. He is a Professor of Leadership and Organizational Change, as well as a Commercial Director at Cranfield School of Management. He runs the Organizational Resilience and Change Leadership Group. David is a trusted advisor to the leaders of some of the world's most renowned companies and government organizations. He helps them to understand issues, identifies their specific needs, and then works with them to produce solutions that bring immediate improvement to their business. David also runs the Leadership in Disruptive Times: a Strategic Approach to Building and Strengthening Organizational Resilience at Cranfield, which is consistently rated as one of the world's top providers of executive development.

 

Tags: organisational resilience, article, CEO Summit 2021

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