What Is Organizational Resilience?
2021 has been reclassified as the age of organizational resilience as enterprises across sectors struggle to recover from the worst crisis in generations. Make sure that you’re able to keep up with the trend by considering what organizational resilience is, how it can benefit your enterprise, and the building blocks you need to get resilient foundations right for a long and prosperous business future.
As businesses emerge from the pandemic rubble, a PwC survey has revealed that around 70% are experiencing significant negative impacts that could take years to recover from. On the flip side of this, the same survey saw 20% of respondents reporting that the pandemic had actually had a positive impact on business overall.
In reality, there’s no clear answer as to what separates these two extremes, with some business models simply flourishing more effectively under remote shifts and online sales. However, preparedness and, more importantly, organizational resilience, is a recurring theme among the pandemic’s business stories, and is a pressing priority for 95% of businesses looking to survive a ‘real’ new normal.
Ezra considers what exactly the term ‘organizational resilience’ means, and how it could set your organization up for a future where unforeseen setbacks aren’t enough to unravel processes entirely.
What is organizational resilience?
Organizational resilience refers to an organization’s ability to stay above the seas of significant business disruption, be those in the form of storms, business disasters (fire/flood/etc.), or even global pandemics. David Denyer’s 2017 definition especially positions organizational resilience as ‘the ability to prepare for, respond, and adapt to incremental change and sudden disruptions.’ Denyer also outlines that organizational resilience can be defined into two narrower subcategories, that include –
- Defensive: The ability to stop bad things from happening
- Progressive: The ability to make good things happen through adversity
A hybrid approach to both focuses has, in large part, been evident among businesses that have best been able to overcome pandemic challenges, especially when implemented as part of a flexible resilience focus including –
- Preventative control: Risk management, backups, and standardized procedures that protect from threats and enhance recovery
- Mindful action: Oversight of threats and the knowledge necessary to respond accordingly
- Performance optimization: Continual improvements that refine and extend competencies based on market needs/technology/etc. both during and after crisis
- Adaptive innovation: The ability to reach new markets, adopt new technologies, and generally implement change quickly in cases of business disruption
In short, flexible organizational resilience with a well-planned and proactive backing is the best way for businesses to prepare for the seamless integration of challenges into operational benefits, shifts, and adaptations.
Why modern workplaces must rest on organizational resilience
Resilience itself is the most pressing and immediate benefit of implementing this pre-planned disaster process in modern business. However, for workforces that have faced significant operational setbacks and job uncertainty in the past year, well-implemented organizational resilience is also essential for rebuilding trust, increasing retention, and generally helping employees to once again foresee a business future. For industries on the brink like hospitality and travel, organizational resilience especially offers particular value in the form of benefits that include –
- An action plan for disaster: By ensuring an effective plan to adapt and grow across disaster-led market changes, organizational resilience ensures both a long and short-term plan that’s easily adjustable to even unforeseen business setbacks.
- The ability to turn trouble around: Flexible resilience plans also make it possible to adapt to market changes instead of against them, leading to success even in times of industry-wide trouble. This is especially evidenced by the New York pizza scene, which enjoyed profit increases of around 43% some weeks at a time when general restaurant sales were dropping by as much as 64.5%
- Increased ability to recognize risks: Offsetting the pandemic was never a possibility, but as can be seen from resilient security organizations that are 6.9% more likely to recognize arising and potential risks as they happen, resilience at least helps to quickly and efficiently understand new risk landscapes and the actions necessary to limit their damage.
- The ability to prioritize crisis investment: Resilient organizations with budgets and business plans that account for a crisis are also far better poised to invest in the innovations that, according to McKinsey, are more essential in the face of these challenges than ever before. This means that resilient organizations were at the helm of tech spending surges that, at points during the pandemic, reached global heights as much as an extra $15bn.
The building blocks of organizational resilience
Building organizational resilience across your enterprise is most generally reliant on preparation, flexibility, and appreciation, but more specifically depends on your ability to lay the right foundations by –
- Defining your values
Values typically expressed through focuses such as KPIs, brand guidelines, and beyond, form the backbone of any enterprise, guiding employees as to how to act in any given situation. For moments of crisis, especially, businesses with clearly defined values and priorities will be far better poised to recognize, recover, and rejuvenate from any eventuality.
- Prioritizing reliable processes
External crises and setbacks are out of your control, but reliable internal processes that rest on pre-laid protocols, responses, and the values mentioned above, should enable the weathering of most storms. Communicating these reliable go-tos across an enterprise is especially fundamental to success.
- Strengthening leadership
A resilient organization relies on a leader who can stay calm and get the job done. A strong leadership style that revolves around decisive outcomes and extensive industry understanding is especially going to act as a guiding hand in any worst-case scenario.
- Training employees
Well-trained employees who understand everything from the intricacies of their job roles through to the smallest scraps of your brand guideline rulebook are best positioned to stay professional and efficient, regardless of industry changes or significant setbacks.
- Acknowledging risk
Companies that blindly ignore risk factors are unlikely to implement disaster recovery plans or any actionable resilience oversights. By acknowledging that risk factors from pandemics to security breaches exist, you’ll be far better able to approach even unexpectedly arising issues with an informed understanding and outcome-driven outlook.
Training focuses ultimately merge with awareness and enterprise efficiency to ensure the inclusive and flexible resilience necessary to weather every storm. And, with the worst storm that businesses have seen in generations still very much hot on our tails, there’s never been a more important time to get on top of these priorities.
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