Develop strategic objectives for increasing your organization’s adaptive capacity and your ability to manage uncertainty and constant change.
After surviving 2020 – the year of change – and in the midst of 2021 – another year of even more change, it is clear that resilience is a strategy that will help us to not only survive change, but to view it as a larger opportunity to reexamine the organization’s identity, how it works, and how it grows.
Organizational resilience is a strategic priority that rises to the level of being an enterprise level goal. Organization leaders must be committed to a sustained focus on organizational resilience. Building resilience must be intentional.
What do we mean by “organizational resilience”?
ISO 22316, Organizational Resilience – Principals and Attributes, defines organizational resilience as the “ability of an organization to absorb and adapt in a changing environment to enable it to deliver its objectives and to survive and prosper.
More resilient organizations can anticipate and respond to threats and opportunities, arising from sudden or gradual changes in their internal and external context.”
The behavior of leadership is a key contributor to how an organization implements its organizational resilience strategies and is rooted in its understanding of itself and its relationship with others. Top management must demonstrate responsibility for the governance and accountability of the organization’s resilience capability.
Planning for a Post-pandemic Future
As shared in McKinsey’s, “Organizing-for-the-future-nine-keys-to-becoming-a-future-ready-company”, the pressure to change has been building for years. Well before the COVID-19 pandemic, senior executives routinely worried their organizations were too slow, too siloed, too bogged down in complicated matrix structures, too bureaucratic.
What many leaders feared, and the pandemic confirms, is that their companies are organized for a world that is disappearing—a world where standardization and predictability is being overwritten by four big trends:
- A Combination of Heightened Connectivity
- Lower Transaction Costs
- Unprecedented Automation
- Shifting Demographics
The pandemic offers a once-in-a-generation opportunity for change. The transition from today’s COVID-19 crisis mode to the next normal offers executives a unique opportunity. By seizing the initiative, companies can create new systems that are antifragile, more flexible, more organic, more interconnected, more purposeful—and simply more human.
Future-ready companies share 3 characteristics:
- They know who they are and what they stand for.
- They operate with a fixation on speed and simplicity.
- They grow by scaling up their ability to learn, innovate, and seek good ideas regardless of their origin.
6 Strategic Objectives to Build a More Resilient Organization
Strategic Objective 1: Strengthen Identity
People long to belong, and they want to be part of something bigger than themselves. Organizations that create a strong identity that meets employees’ needs for affiliation, social cohesion, purpose, and meaning will be more resilient.
- Take a Stance on Purpose. Purpose helps attract people to join an organization, remain there, and thrive. They know who they are and what they stand for. The organization’s vision, purpose, and core values are clearly understood and provide coherence and clarity in all decision-making.
- Sharpen Your Value Agenda. Articulate where value is created, what sets the company apart from the pack, and what might propel its success in the future. An understanding of the organization’s context and relationships allows it to make more effective strategic decisions about priorities for resilience.
More resilient organizations know who they are and what they stand for. They have a comprehensive understanding of who they are and their relationship with others both internally and externally.
The ability to strengthen your organization’s identity, is dependent upon having certain capabilities in place:
- The organization’s behavior is aligned with a shared vision and purpose.
- The organization’s strategic and operational goals and objectives are supported by individual goals and objectives that are aligned the organization’s purpose, vision, and values.
- The organization recognizes the need to reflect on and, if necessary, revise the organization’s purpose, vision, and core values in response to external and internal changes.
- The organization’s understanding of itself and its partners allows for the ability to think beyond current activities, strategy, and organizational boundaries.
- The organization maintains strong relationships with its interested parties and fosters collaboration and cooperation at all levels.
- The organization seeks partnerships when needed to deliver on its strategy and support the achievement of its purpose and objectives.
Strategic Objective 2: Improve Culture
As McKinsey states, use culture as your “secret sauce”. Its main ingredients are specific and observable behaviors that employees at all levels adhere to. The organization’s culture provides a sense of identity to its people. It promotes a sense of commitment and reinforces the values of the organization.
- Engage Your People at all Levels. Leverage your culture as a tool to build and strengthen trust. Embrace change and, in the process, become more flexible and adaptable.
- Foster Learning, Creativity, and Innovation. Value error-reporting and learning over blame. Encourage your people to communicate their ideas both vertically and horizontally in the organization. Knowledge and information are widely shared while learning from others is encouraged.
More resilient organizations demonstrate a commitment to a healthy culture where there is a commitment to, and existence of shared beliefs, values, positive attitudes, and behavior. A healthy organizational culture serves as a control mechanism for shaping behavior.
The behavior of an organization’s leadership is a key contributor to how an organization implements its organizational resilience strategic objectives and is rooted in its understanding of itself and its relationship with others.
Leadership is responsible for creating a culture that fosters creativity and innovation and where leaders are effective, trusted, respected, and who act with integrity. Improving culture is dependent upon leveraging the following capabilities:
- The organization’s leaders develop and encourage others to lead under a range of conditions and circumstances, including during periods of uncertainty and disruption.
- The organization develops leaders to improve their emotional intelligence and how they adapt to changing circumstances.
- Leadership is distributed throughout the organization. Leaders at all levels are empowered to make decisions that protect and enhance the resilience of the organization.
- Leaders of the organization demonstrate responsibility for the governance and accountability of its resilience capability.
Strategic Objective 3: Build for Speed and Agility
Operating models need to be fast, nimble, and frictionless to create ways of working that foster agility and simplicity. They need to enable a network of empowered, dynamic teams to find pockets of value, including at the company’s “edges” where employees are closest to customers.
- Structure for High Performance and Managing Change. Adopt models that are designed, nurtured, and grown around people and activities. Flatten your structure as much as possible. Design a workplace that is both flexible and productive. Design networks of local cross-functional teams with clear, accountable roles. Ensure a clear understanding of how work occurs – the links between work, place, and workers are understood.
- Agile Change Management. Businesses must be prepared for nimble and constant adaptation if they hope to grow with any consistency. Doing so entails constant interaction with stakeholders, technology, and employees. Harness a vibrant ecosystem of partners outside the company’s traditional boundaries.
More resilient organizations demonstrate a commitment to managing change using an agile change management process throughout the organization and including all personnel.
Building for speed and agility is dependent upon the following capabilities:
- The organization understands how its structure and design impacts its agility.
- The organization’s structure and design allow people to collaborate and communicate both horizontally and vertically throughout the organization.
- The organization’s structure and design allow those responsible for responding to and managing an incident to switch from one design to another if needed to work in a more agile and flexible manner.
- The organization is designed to have shorter chains of command / lines of authority allowing for more delegation and empowerment and operating in as flat a structure as possible.
- The organization’s workplaces are comfortable places to work and allow for employee engagement and collaboration.
- The physical design of the workplace is aligned with the type of work being conducted to ensure maximum productivity.
- The facility is a safe place to work and practices environmental stewardship and sustainability.
- The organization is aware of circumstances that are likely to influence change and demonstrates the ability to anticipate and manage change.
- The organization can adapt itself when needed and without significant impact to the delivery of its products and services.
Strategic Objective 4: Build a More Resilient Workforce
Organizational resilience is enhanced when knowledge is widely shared as appropriate and applied and is recognized as a critical resource of the organization. Treat talent as scarcer than capital – nurturing and retaining talent whenever possible.
- Nurture and Retain Talent. Select and develop leaders with a diversity of skills, capabilities, knowledge, and experience. Foster an inclusive employee experience. Reward and recognize performance to increase engagement. Deploy wellness and mentoring programs.
- Accelerate Learning as an Organization. Promote a mindset of continuous learning that encourages and supports people to adapt and reinvent themselves to meet shifting needs. Share knowledge and information in a timely manner to enable effective decision-making.
More resilient organizations demonstrate a commitment to its workforce ensuring that its people are engaged, can handle stress, make decisions, and manage continuous change.
A resilient workforce requires a commitment to strengthening the following capabilities:
- The organization values information, knowledge, and learning. It is accessible, understandable, and adequate to support the organization’s objectives.
- Knowledge and information are created, retained, and applied through established systems and processes.
- The organization provides opportunities for learning and professional development and creates a positive work environment. It is committed to investing in its people.
- The organization understands how work occurs ensuring that the links between work, place, and workers are understood.
- Learning is drawn from all available sources, uses what it has, and learns from experience and from others.
- The organization encourages the creation and sharing of lessons learned about success and failure and promotes the adoption of better practice.
Strategic Objective 5: Use Data to Empower Decisions
The organization understands that data IS the business. Data should continually empower decisions and the value agenda. The organization uses predictive analytics and performance management to operate agilely.
- Build Data-Rich Systems for Managing Change. Design systems to anticipate, plan, and respond to changing circumstances. Leverage IT operations data to provide insights, discovery, and capacity planning.
- Transform to Agile Finance Management. The finance function is the go-to source for decision-support, delivering analytic insight to drive strategy and provide real-time insight into the state of the business.
More resilient organizations use data to inform all decisions, forecasting, and managing change. Data-driven organizations automate processes to increase agility and flexibility.
The following capabilities are required to enable using data to empower decisions:
- Utilize artificial intelligence, intelligent automation, machine learning – using technology as a tool for managing change and informing decisions.
- The organization automates transactional processes to provide a high degree of scalability and agility.
- Talent management / human resources hires people who will improve the finance function’s strategic influence and management guidance.
- The organization uses centers for financial planning and analysis – centralizing finance-related subject-matter expertise. The organization relies on the finance function to help them understand what is and what is not generating value.
Strategic Objective 6: Increase Preparedness & Manage Risk
The organization implements systems to anticipate, plan, and respond to changing circumstances. It develops and allocates resources such as people, premises, processes, technology, finance, and information to address vulnerabilities, providing the ability to adapt to changing circumstances.
- Resources are Available, Assigned, and Competent. The organization develops and allocates resources such as people, premises, processes, technology, finance, and information to address vulnerabilities and providing the ability to adapt to changing circumstances.
- Risk is Effectively and Efficiently Managed. The organization anticipates and responds to threats and opportunities arising from sudden or gradual changes to its internal and external context.
Organizational resilience is enhanced when the organization intentionally manages risk and prepares for the unexpected. The alignment and collaboration of risk-based systems is essential and is based upon having the following capabilities in place:
- Roles, responsibilities, and authorities are assigned to competent personnel who collaborate and communicate effectively.
- All areas of the organization that manage risk are coordinated and collaborate to eliminate silos and to operate effectively and efficiently.
- The organization manages its resources in an agile manner ensuring that the right people are on the right teams at the right time – ensuring they are adequate and available when needed.
- The organization ensures that its methods of managing risk are robust and effective and respond to change and uncertainty.
- The organization empowers its people to identify and communicate threats and opportunities and to take action that will benefit the organization.
- The organization identifies which methods of managing risk will meets its needs.
The organization anticipates and responds to threats and opportunities, arising from sudden or gradual changes in its internal and external context. The ability to effectively and efficiently manage risk throughout the organization is dependent upon implementing risk-based “systems” as one risk management framework. Below are examples of systems to consider:
- Asset management system
- Quality management system
- Incident response structure
- Crisis management and communication system
- Business continuity management system
- Safety and security system
- Supply chain risk, continuity, and security system
- Information and communication technology continuity system
- Critical environment system
- Information and cyber security system
- Storage and availability system
Required Behaviors to Support an Organizational Resilience Strategic Capability
In addition to strategic objectives supported by capabilities, the organization must also behave in a manner that drives a more resilient culture – “how” the organization does its work and creates value.
These 6 behaviors should be intentionally sought and demonstrate how the organization and its people interact with itself and with others. They are the metrics used to measure an organization’s resilience behavior capability. These behaviors are important in preventing breakdown or failure; or enabling an appropriate and timely response to be taken.
- Adaptive and Flexible: The organization is accepting of ever-increasing uncertainty and change. The organization and its people share an ability to change, evolve, and adapt in response to changing circumstances and the ability to apply existing resources to new purposes. Mechanisms exist to continuously evolve and, recognizing this, the organization is able to modify activities rather than seeking solutions based on the status quo.
- Resourceful, Creative, and Innovative: The organization and its people rapidly find different ways to achieve their goals or meet their needs under changing circumstances. They transcend traditional ideas, roles, and patterns to create something new by using originality of thought and demonstrating imagination. The organization fosters creativity and innovation by seeking out and promoting new and innovative ideas to achieve its objectives.
- Inclusive and Collaborative: The organization seeks collaboration with and engagement of its interested parties to enable working together towards a common purpose or goal. The inclusion of its people in the collaboration results in a sense of shared ownership or a joint vision to build resilience.
- Prepared, Robust, and Redundant: Intentional actions exist to work out the details of a plan of action in advance of it being needed. Robust systems are well-conceived, constructed, and managed so they can withstand significant impacts without damage or loss of function. Spare capacity is purposely created within systems so that they can withstand disruption, extreme pressures, or surges in demand.
- Aware and Reflective: The organization has the capacity to anticipate future conditions through situational-awareness, horizon-scanning, and information-gathering. The organization and its people learn from past experiences and leverage this learning to inform future decision-making. Collective awareness and reflective nature increase the organization’s ability to think beyond its current activities, strategy, and organizational boundaries.
- Diverse and Integrated: The organization recognizes the importance of the diverse nature and characteristics of its people. This includes a range of capabilities, information sources, and technical elements. Diversity is best implemented when there exists the opportunity to bring together disparate thoughts and strategies into cohesive solutions and actions. This includes the intentional horizontal and vertical integration of the working environment.
ICOR’s Organizational Resilience Capability Assessment
Wondering where your organization falls on the resilience continuum? Need to understand your strengths and weaknesses in order to determine where to focus for future growth?
It is impossible to implement strategic objectives effectively without having the ability to measure your where you are and where you need to strengthen your capabilities.
Learn more: https://www.build-resilience.org/OR-Capability-Assessment.php
About the Author
As President of ICOR, Lynnda Nelson manages the day to day operations of ICOR University. ICOR University offers education and certification in business continuity management, crisis management & communications, data center management, emergency management, organizational resilience, social resilience, and supply chain risk management globally.
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